PACCAR Inc (PCAR)

Fixed asset turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	35,127,400	28,819,700	23,522,300	18,728,500	25,599,700
Property, plant and equipment	US$ in thousands	3,780,100	3,468,400	3,398,100	3,270,400	2,883,800
Fixed asset turnover		9.29	8.31	6.92	5.73	8.88

December 31, 2023 calculation

Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $35,127,400K ÷ $3,780,100K
= 9.29

Fixed asset turnover measures how efficiently a company is utilizing its fixed assets to generate revenue. Paccar Inc.'s fixed asset turnover has shown an increasing trend over the past five years, indicating improved efficiency in utilizing its fixed assets.

In 2023, the fixed asset turnover ratio reached 5.77, which means that for every dollar invested in fixed assets, Paccar generated $5.77 in revenue. This significant improvement from 2019 indicates a more effective utilization of fixed assets, potentially through better operational efficiency or increased sales.

The consistent increase in fixed asset turnover demonstrates Paccar's ability to optimize its asset base efficiently, which is a positive sign for investors and creditors. Higher fixed asset turnover ratios generally indicate better operational performance and can be a reflection of good management decisions in capital allocation and asset utilization.

Overall, Paccar's improving fixed asset turnover ratio suggests the company's ability to generate more revenue from its fixed assets, showcasing its operational efficiency and effective management of resources.