Volkswagen's truck division Traton's shares surge following strong Q3 results

Shares in Traton, Volkswagen's truck division, jumped as much as 10.4 percent on Tuesday after Volkswagen trumpeted its third-quarter results, which beat forecasts, riding high on sales from its US brand, International, and Swedish unit Scania. By 0728 GMT, Traton's stock rose 4% to a high not seen in three months. Meanwhile, shares of peers Daimler Truck and Volvo also climbed 1.7 percent and 1 percent respectively.

Traton, which will keep the name Truckizon as part of the new business, also announced in its July-September report a 19 percent increase in operating profit to EURO 1.14 billion (USD 1.23 billion). Analysts had projected a 8.7% return on sales and the actual return on sales was 9.6%. Traton's performance has been impressive but it decided to stick with its annual guidance, which has led to some skepticism from investors.

"A fly in the ointment" was a lack of an upgraded forecast and the absence of quarterly order intake figures, a local trader noted, cautioning that this could dampen positive reactions to the results.

However, Traton's performance is also timely given that its parent company Volkswagen is battling plummeting sales in its core models and growing Chinese competition. Discussions within Volkswagen over plant closures in Germany have been sparked by the challenges.

Traton's robust quarterly results, which come as its parent company faces broader pressures in the truck industry, signal resilience in the turbulent world of commercial vehicle. Looking ahead, Traton will continue to attract the focus of investors as they look to monitor ongoing developments relating to Traton's order intake and guidance adjustment.