AB Volvo (publ) ($VOLVB)

Welcome to the Volvo Group Capital Markets Day 2026. It is 18 months since last time. And yet again, we are in a special location. This time, the headquarters of Volvo Construction Equipment in Eskilstuna, Sweden. And this month, something extraordinary is taking place here. We have 4,000 customers experiencing our products and services. But that's for later. Now let's go inside where the live audience is waiting. Again, most welcome and especially to you in the live audience. It is great to see so many familiar faces in the crowd. We have an intense couple of hours together where we are going to share our view on how we are thinking strategically and what we are doing proactively to capitalize on our strengths in a very dynamic market. So let's get into gear and welcome to the stage, the Volvo Group President and CEO. Martin?

It feels really great, Kina. And also from my side, of course, welcome to this Capital Markets Day 2026, Eskilstuna. The sun is shining. And we have a fantastic program this afternoon also because we have the setup, as you alluded to, with the Volvo Days with all the lineup of products, and you will be able to test and feel and get the emotions of the Volvo products and solutions. So welcome, everyone here in the room and, of course, also everyone online. It will be great.

And Martin, we met 18 months ago in this setting. We were in new River Valley. And the theme at that time was gearing up for growth, which reflects an organization building capacity and momentum. This year, the theme is built for resilience and growth. Slight shift in language. Why is that?

But first I mean, obviously, we have been on a journey for quite some time now and with the objective of continuously building resilience that is important in a business that is cyclical and in a world with many moving parameters. And at the same time, of course, taking the growth opportunities that lies ahead of us. And 18 months is a long period now, a long period. So a lot of things have happened since. And it has been really about continuing to building that position of resilience and accelerated growth. And that is what we will both see the achievements, but also what is about to come. So very exciting.

Very exciting. So resilience and growth, you will recognize will be a major part of our agenda today. We're going to start with geopolitics and how the current situation impacts our markets and our position in it. And then instead of giving you presentations business area by business area, we are going to look at growth opportunities from a segment point of view. And then towards the back end, how we are investing for our future. Should we get going?

We get going.

We get going. And Martin, I know that many in the audience would like to hear your view on the world around us. So why don't you join me over here?

Absolutely.

So we are going to look at many different aspects of our business today. But I know, Martin, that you wanted to start with something which is really close to our hearts every day, our customers.

Yes. And that is always a tough start because I get most thinking about customers. But I think it is like this that, I mean, of course, the Capital Markets Day is tempting to start with the strategies and the big picture and the big bets what we want to do. But at the end of the day, and often, 95% of our time we spent, of course, on focusing on how to make our customers competitive, successful. And we often say that the revenues and cash flow and earnings and building a stronger balance sheet, the are outcomes. They are not falling down from heaven. They are coming from customers that want to and they don't have to work with the Volvo Group. And that's the reason why we are taking that very seriously and spending a lot of time in all parts of the organization, in our business areas, in our different parts of the value chain to really make that successful. That is very important. And we say that we live with our customers. And I mean, it's very common that companies talk about customer focus, but you talk about customer obsession rather. We are B2B, and that means that for every customer, the solution, not a solution. And the solution that is really tailor-made for him or her, meaning that you need to understand the job to be done, and we will come back to that because that is one of the key factors of success in our industry, never compromise the optimized solution for the customer. Then it's our job to make scale and scope and technology to happen. Customers couldn't care less about that. They want to have an optimized solution for their mission.

And here comes the first tricky question today. Since we met in New River Valley 18 months ago, how many customers have you met?

You asked me this question 1.5 weeks ago. So it's not that tricky anymore. But I ask Helen now to backtrack that also. And we came up to -- I mean, of course, I met thousands of customers since, but with meaningful conversations, more than like 20 minutes where we have had feedback, 915. So yes, 2, 3 per day the year around. And that is super important for us because at the end of the day, we have millions of -- millions and millions and tens of millions of data points and important feedback, obviously. But that conversation about what is happening, what is the feeling and the different type of stories here. One example a couple of weeks ago was about this -- a big customer, by the way, in Europe talking about that, and we had a good conversation on both what we need to improve. It's always about that, obviously. But also I ended that conversation by saying thank you, Martin and the team for bringing my drivers safely home. And I mean that is a fleet owner that has more than 2,000 trucks, and that really matters, of course, the driver attractiveness. -- just as one example.

And just to back up a little bit, 2 every day, 365 days a year, including weekends. That's quite a schedule, I must say.

But I mean, I'm just representing the rest of us. If you ask Stephen or Roger or Anna or everyone here, I mean, that is how we live together with our customers because if we don't understand the job to be done together and build that trust, it will never fly.

Martin, let's change the topic a little bit and talk about geopolitics. I mean I don't think anyone could have guessed where we are as a world today 18 months ago.

No. And I think that is always the case. I mean some wise guy did say that it is difficult to make forecast especially about the future. And I think that is more valid than ever, obviously. We have a lot of moving parameters. We know that, and we need to live with that. But it has been so during a long period of time. Now it's intensifying. Obviously, we have a number of cycles coming together. We have -- I mean, the normal economic cycle, what will happen. We have the geopolitical cycle that is intensifying. We have demographics. We have technology, we have climate and energy transition, et cetera. So there are quite a number of parameters to take into account. But that's the reason why it's so important with the team that we have today because you can look upon that from a challenging point of view, but I think we have a good opportunity to look from an opportunity perspective.

And more in detail, how is this uncertainty impacting the Volvo Group?

No, it's a lot about obviously continuing to build -- that's the reason why resilience matters. because, obviously, if you have the ability in the group to react if that is necessary, but more important to act and be ahead of the curve and to do that with flexibility and speed because that is important, that you continue also to have the right mix in your portfolio, both when it comes to the customer base, but also when it comes to the mix between, so to speak, equipment revenues and recurring revenues such as service. So a lot of these topics we have been working with, and that is a platform for continuous growth, obviously.

And just a couple of weeks ago, you were hosting a visit from Narendra Modi, the Head of State of India. In times of regionalization, how important is such a relationship?

Of course, it was an honor to have the PM Modi, I mean, one of the fastest-growing big economies in the world coming to Gothenburg.

Center of the Universe.

Yes. I think, yes, if we should have been humble, we should have been perfect, right. No, seriously, PM Modi together with Von L and our Prime Minister, talking about the bilateral opportunities between Europe and India, but also for us, obviously, an opportunity to talk about a very important region, India for India, obviously, we have a very strong footprint there when it comes to sales and when it comes to customer base, but also when it comes to India for the world, carry back a lot of great opportunities that we have there. We are now stepping up apart from technology digital, also the fourth global industrial hub. We have Volvo ICE commercial vehicles that is a hidden diamond, I think for everyone here included last year that ended last of March for VSE, they surpassed 100,000 vehicles for the first time. And with a growth rate that is double digit and with margins that actually are quickly approaching the group's margins. So this is an asset that we are very proud of, both when it comes to that development, but again, how they are taking care about the customers and the whole Indian ecosystem.

There is obviously a lot happening in our industry. And I think a talking point during the spring has been increased competition. You mentioned India, but there is obviously also China. What is your take on that?

Yes, there's India, there is China. There are new entrants. There are technology shifts, et cetera. And I think the first -- I mean, where there is growth opportunities, competition will continuously, of course, intensify. That's natural because there are opportunities for everyone. Having said that, we also see that the competition is not only there, but they are good. They are speedy, they are innovative. And in a world like that, you need to continue to both maintain your strength, but also accelerate a number of areas, so you are ahead of the curve. But as I said, I think we have, I mean, capabilities, assets, we have people, we have customer base. We have the financial position, but we have the innovation power to get the job done together with our customers. But as in all competitions, and I like that, -- you need to always get better. And that is why market economy really works, right?

So being the best, that is what it will take to win.

I mean being not the best is not an option if you want to compete in a global market, but still being very local.

Talking about innovation and technology, Martin, the last couple of years has been a technology race. We have been investing heavily in traditional technology, in more sustainable solutions. Going forward, how do you foresee that this will develop?

We see that it is plateauing now. But I think it's more the important reason behind that rather than the figures as such because I think we have been very consistent in our capital allocation. strong financial position, bring really the innovation to the table and also, of course, good returns to our shareholders. But if you take that innovation, one thing is that we always will provide what the customers want, meaning that now with the prolongation and we see a clear prolongation of -- and actually a further acceleration of our combustion technologies, both with the traditional but also renewables. We continue to invest in that. And we have created a number of platforms for the future that has brought us to a rather high level. Now we see that, that is plateauing and decreasing. You can take the BEV, the battery electric long range now, 700 kilometers, best payload and so to speak, the maintenance schemes, charging times, what have you. And now that platform is there through our modular system, and we can really start to optimize. Then you don't have the same level of investments, but you have the platform to really build from. Same when it comes to certain capacity build-outs in North America, we will come back to, for example. So plateauing and a slight decrease. That is not the same that we are stopping our innovation, not at all.

And that brings us to the transition to a fossil fuel-free future. That's the tongue twister.

Well done.

Thank you very much. I've been practicing. So how will the journey towards zero emission play out?

What we see clearly is, of course, that the overarching theme, including, I think, quite a lot in this audience 4, 5 years ago, has slightly shifted, if I put like that. So decarbonization as a theme for regions and governments is still there. But alongside decarbonization as such for the energy transition, it is also about resilience, it is national security and its competitiveness. And you need to act with these 4 factors in focus. But if you do that, and that's the reason why we still committed to Paris, for example, because, I mean, if you want to drive the energy transitions from these 4 angles, regional or national security, meaning regional value chains, competitiveness, resilience and decarbonization. That will be a winning formula. So we need to be there. We want to be there and customers want to be there. But we will come back and talk about that later.

There is an expression that you use quite frequently in our internal events, and that is excelling on the basics will still make you unique. With that as a platform, what differentiates us as a company that will enable us to win?

No. But I think, especially, and we have talked about it, Kina this morning, when you have a lot of moving parameters that you need to, of course, incorporate and integrate not only your strategy, but in your execution plans. You need to do that from an angle where it matters for real, regardless if that is new propulsion technology or AI or digital capabilities. And that is really get the job done, build trust with our customers. And we have an extremely strong platform when it comes to the customer trust. That is an asset and a pride that we can never underestimate. But that is coming, of course, over time to deliver that TCO, to deliver that uptime, to deliver that fuel efficiency, to deliver that safety, to deliver that comfort, not from time to time, but every day. I mean -- and you do that thanks to great people. And we believe in the decentralized organization with the ownership mentality to make it happen. And if you do that really well, it will still make you unique, I promise you.

Martin, you wanted to start this conversation emphasizing our customers. How would you like to close?

No. I mean, closing that is, of course, about the first part here, you see how do we build customer trust. And when -- I mean, I can take these 915 great customers that we have really talked about, but also the feedback we are getting in other channels and all the colleagues here. Of course, it's about product and solutions, but it's so much about our people and how they are supporting our customers in all parts of the value chain and how our customers feel that, the drivers feel that their fleet managers feel that, that we are really working closely together. And that feedback is super important. And often, actually, we had Roger and myself, we talked about that a couple of days ago when we had an issue with -- I think it was '16, '17, we were in Eastern Europe and talked to a specific customer. And Martin is his name as well, by the way. And he said, Martin and Roger, -- we need to fix this now. I didn't say you have to fix it now, but we need to fix this now, and that is the spirit. Thanks to our people.

And there truly is power in our people and bearing in mind that we have 100,000 colleagues all over the world that is a lot of energy devoted to winning the game. Take a look at this. [Presentation]

I love this movie.

Yes, I love this movie, but I love our people even more.

Okay. I love the people and I love the movie. So Martin, we're going to build on what you were saying about being a resilient organization and the fact that we, over the last decade has built a platform that enables us to lead from a position of strength. And to talk more about how we have created performance resilience, let's welcome to the stage our CFO, Mats. You got more cheerful I don't know how resilience and growth. Why is that important?

The short answer is value creation. I mean it's essential for value creation, looking at resilience and growth. And I think resilience that really shows the kind of core capabilities that we have in our operations, but also our ability to execute. I think that is, to some extent, prerequisite when it comes to growth then. So resilience and growth goes a little bit hand in hand, I would say.

Why don't we take a look at our performance journey? And why don't you share your comments?

Yes, it is a good journey. So looking at margin expansion over time. But even more importantly, coming back to resilience that we have less volatility and it shows that we have been better in order to manage the business cycle as well. And I think it clearly shows that in terms of the margin development. Martin?

No, just to add to what Mats is saying, of course, very proud of the journey together with the team here. And I think there are a number of key factors. We talked about flexibility and agility that we have a very clear toolkit, the decentralized decision-making, but also a clear toolkit of doing that. We have been bringing a lot of innovation and technology to the table where we have been successful also actually to driving commercial conditions and value creation, both for our customers and ourselves. Service development has been very important. And again, then the recipe for success that we talked about. And I'm very proud to see that this is a journey where all business areas and also truck brands have really make a contribution. So we don't have any clear pockets of drag anymore, I should say, and that is super important, obviously, both resilience and growth opportunities.

And you mentioned services, which is, of course, a core pillar. Why don't we look at our services journey? And maybe, Martin, you can share a few words.

Yes. I mean, also here, a very good journey, as you can see, over then many years, still opportunities ahead. The most important is actually maybe not the figures. It is really what we see when we have a higher penetration of service content together with our customers. We have a higher retention. We have a higher satisfaction and loyalty. So from a customer perspective, super important. And then obviously, as a very positive byproduct, it is also the recurring revenues for us. So very proud of this that is happening across business areas and geographies.

You can see the smile. As a CFO, I love service. Coming back to resilience and growth. I mean, the service business being less cyclical than the new vehicle sales, meaning that, that brings the kind of the stability and resilience. And on top of that growth, I mean, what you can see over this time period, close to 5% CAGR. And if we're looking at the recent data points where we are today in fourth quarter and first quarter between 5% and 6%, so providing growth as well. And on top of that high profitability, so contributing to margin expansion. So service is great.

That explains your happy face. So finally, Mats, let's compare with our peers.

Yes, a little bit the same story over time. But if you're looking at that in relative terms, you can see also a relative kind of improvements when it comes to resilience over time and less cyclicality. And if you're looking at the latest data points here, representing them for truck, buses and engines, we are actually best-in-class when it comes to the adjusted operating margin. So a good development relatively as well.

Martin?

Of course, again, proud of that, Kina, but I mean, this is a relative, but more importantly, it's an absolute game also to continue to build our story with the potential we have. I would also like to comment Volvo Construction Equipment, I mean, starting on the lowest point then a little bit more than 10 years ago and have really built also a very strong foundation. amongst the best now when it comes to margin, the margin expansion. But I think it's time now, Melti, for some growth also, right? So maybe you can come back to that.

He will come back to that, I can assure you. So I think it's fair to say we are very proud of this journey. We are happy, but not satisfied. There is lots to do still. Mats, take the stage.

Yes. And I will elaborate more when it comes to the resilience and growth. But before that, just spending a couple of minutes when it comes to the current situation now in the second quarter in terms of the trading update. And it's very much the same message as we gave when we reported the first quarter earnings then in -- I think it was April 24. Looking at the different regions, we continue to see a solid customer demand in Europe for April and May. So no big impacts when it comes to the Middle East crisis on the demand side in Europe. Looking at North America, we continue to see a strong customer demand, and we are now taking orders for the third quarter and fourth quarter in U.S. And we are gradually also increasing the capacity in U.S. then. We have a general cost inflation that is gradually increasing, and this is the area where you can start to see impacts from the Middle East crisis then, most pronounced when it comes to increases on the freight cost, but also on raw material side. So that will have an impact on the cost side in the second quarter. And then last but not least, we continue to see high utilizations when it comes to the trucks and machines, meaning that, that is driving service revenue as well. So all in all, a very similar message to what we gave when we reported the first quarter earnings. Turning back then to the more kind of long-term development and to the resilience and growth seen then. You already saw this slide. good margin expansion, high -- being resilient as well and less volatile. But there are also still room for improvements when we're looking at the financial development. Many of you probably recognize this slide from the previous Capital Markets Day. So this shows the adjusted operating income for Group Trucks for 2025. And in 2 dimensions, basically then looking at the different truck trends and looking at the different geographical regions. And as -- you can see there are big differences between the different geographical regions in 2025. But overall, a pretty good adjusted operating margin given the environment, close to 10%. But the difference then, looking at the positives then in terms of performance, starting with Europe, very good financial performance in Europe in 2025 and especially looking at Volvo Trucks then that has been combining the market share leadership with a good performance. But also, we can see Renault continue to develop in a good way, being close to the group target of 10%. I would also like to highlight South America or as you know, then being mainly Brazil then with the footprint for trucks, where we have had a good financial performance despite very, very challenging external environment in Brazil. But this is also reflecting our end-to-end way of working when we have an integrated model in Brazil, meaning that we are swift when it comes to adjusting capacity to demand. Looking then on areas with room for improvements. North America sticks out in that respect, as you can see here, mainly due to the external environment looking at North America with low demand, mainly driven by a very tough financial situation for our customers with yet another year of freight recession in U.S., but also in combination with tariffs and general cost inflation. So room for improvements, but also in our own operational system in North America. The other one that sticks out being significantly below the target that the transformational ventures. And you probably remember that I was quite granular last time talking about the transformation ventures and also guided that we will likely see an impact on the trucks margin of about 150 to 200 basis points. And that is what you see on this performance there. But going forward, we have done quite a lot on the joint ventures. So what we can see now is between 100 and 150 basis points going forward in impact. So to summarize, a fairly good development looking at overall profitability, but with rooms for improvement. Moving into the drivers or how we are driving performance overall in the Volvo Group with a couple of priorities. Martin already talked about the decentralized decision-making that we have. We are working in a decentralized setup, meaning that we have P&L responsibility, accountability far out in the organization. But that is also combined with decentralized decision. So we're utilizing the flexibility tools to adjust to the external environment using the flexibility tools we have in the system. We have price discipline. You have heard this before. We are adjusting capacity when not using pricing in order to drive volumes. We are increasing the service business. We have already talked about that, and my colleagues will talk much more about the service business, but also how we are driving the total offer being very, very important. And last but not least, cost control. We have a culture of being cost conscious in everything we do, and that is something we are proud of. Moving in then to the portfolio, and this is also a slide that probably many of you recognize from previous Capital Markets Day as well. We have actually done quite a lot when it comes to the portfolio since the last Capital Markets Day. We have addressed some of the low performers. We have divested SDLG for CE. We have made a decision to exit the Rokbak business, but we are also adjusting a little bit when it comes to the ventures with a new business model for Flexis. And we are also welcoming Toyota into the Cellcentric joint venture, which is important. But we are also making more forward-leaning growth-oriented changes in the portfolio. We have the Mexico footprint to facilitate growth. And this is something that Roger, Steve and I believe Jens will talk a lot about later on. We have also made acquisitions and especially looking at the retail and service side, acquiring Sweton for construction equipment and the deal of Western Australia for Volvo Trucks. So very growth-oriented investments. And Nils will talk a little bit more about autonomous later on today, which is also a really exciting growth area that we see. So to summarize from a financial point of view, we have built resilience and we are ready to accelerate the growth. And I think this chart really shows that our strategy has been serving us, customers and the owners really well.

Thank you very much, Mats. We will see much more of you later. So please take a seat. And Martin, looking at this slide, it happens to coincide with the same time period that you have been the CEO of this company. What would you say has been paramount to the creation of resilience under your leadership?

No, it is a teamwork. We are 150, 160 countries around the globe, and it needs to happen every minute, every second out there and to give the opportunities for our teams to succeed has been super important for me, for the executive team, and I think we have been successful in that. And also in a good way then combining this customer obsession with the scale needed and a number of other factors that we have been alluded to, but it's teamwork really that is driving that. And that we are long term and consistent in our way of thinking here. Customers must win. That is good for the company. And if that is good for the company, it's good for the owners of the company. So it's -- that's the logic.

But this is not the end of the journey.

It's not the end of the journey. The day you think that's the end of the journey, you should do something else probably.

So still lots to do. Great to hear, Martin. We're going to drive into the next part of the program and look at the key value levers driving resilience and growth. And now the stage is yours.

Thank you, Kina. And what we would like to do in a couple of minutes is to pull together a little bit the introduction here with a number of main conclusions about what has happened, but more importantly, what is the journey that is about to come for us and what are the key levers, as Kina said here. The starting point, obviously, is this one that the global demand for transport and infrastructure solutions, logistics and also compounded by a number of factors that we come back to will continue to grow across markets and the underlying trends of that it's very strong, obviously. So the commercial opportunities there. But each job to be done for different reasons, and I will come back to that needs to be more efficient, more safe and eventually more sustainable to stay competitive. So that is the starting point, and we take it from that. Then obviously, there are a number of very important transformative elements happening now. little bit busy slide. Bear with me, I've done it myself. That's the reason why it's not that professional. But it's an important one because we are super excited, and that's the reason why we love our business is that we are participating in a wealth creation for nations, societies. It's such a clear relation between advanced logistic transport infrastructure systems and the GDP per capita development on absolute level. The more advanced, the higher drive for GDP. So that's a great starting point, right? But we also know that both logistics and transportation and infrastructure development also comes with a number of side effects. We are constantly improving these side effects, but they are there to some extent. It is about climate, but also pollution. in cities. That I should argue for some of the big regions, especially the pollution topic in big cities is one of the key drivers of doing things, right? Noise congestion, talent acquisition is super important. The driver attractiveness. So there are 2 sides of that coin, either autonomous solutions for certain applications, but also constantly evolving when it comes to the driver attractiveness. And then obviously, energy resilience, energy transition. To move that into green will be the winning formula. But of course, there are parameters that we need to take into account in order to make that happen. The regulatory push is obvious in many different markets and regions, and that is important without some of these regulations, things will not happen if they don't have natural links to the market mechanics. Market mechanics also, of course, very important and customer pool combined with the market mechanics to create the right type of TCO, but also other incentives, market incentives, enablers, I will come back to in order to make transformative developments happening. And then, of course, the technology development that is also further than accelerating now. There are, of course, different priorities for different stakeholders here. But at the end of the day, we need to relate to it together with our customers to be successful. That is how we drive business forward here. And in order to do so, it starts with a job to be done. It's easy to aggregate this to high levels. It's easy to talk about the bigger picture, which we eventually need to do in order to pull together scale, technology bets, industrial footprint investments, et cetera. But at starting point, it starts with this. It starts with the solution for the customer. And here, I've just taken one example, and I've taken an example that is pretty well known in order to make the point here. And that is typical long-haulage application in Europe, probably 120,000, 125,000 kilometers, quite many more -- many customers doing a lot more there, but we took that for the point. A 4x2 tractor, in this case, diesel ICE operation. And what you don't see in this P&L because every equipment is a profit and loss statement with the heart, but I will come back to the heart a little bit later, is the revenue generation. The revenue generation for the customer is, of course, the starting point if you make a P&L and there, payload, uptime and availability and durability is, of course, super important. And here, we are talking about the cost elements of the P&L. And where you see in this specific application, the vehicle, including trailer, so the equipment as such stands probably for depending a little bit on country, 12% to 14%, 15%. I would make it clear for you that we are not the cheapest here by far on this diesel execution, if you take a Volvo truck or a Renault truck. But we are pretty competitive when it comes to the vehicle here since we have such a great residual value. So price minus residual value is, so to speak, the component what we look at here, the 12% to 15%. The more important piece of this is how this -- how does that affect the rest here. Energy efficiency, uptime, driver attractiveness, safety comfort, availability, both for top line and cost. That logic prevails regardless of region, application segment. And it will always be the competitive set, the solution for the customer. How do we produce that? We produce that through the total offer. And the total offer is a combination of products and solutions that are eventually opted to be tailored for every application, customer segment and geography. I will not go into detail here because my colleagues will touch on how we really execute on this in today's landscape. But it is important to continuously build a modular platform around this to be successful. If we then take another example now, one of the transformative elements because in my -- when I described the transformation, that could be seen as, for example, propulsion technology, moving from a diesel or an internal combustion engine, even from diesel to a renewable or from an ICE or internal combustion engine to a battery electric or what have you. Then if you take the battery electric here, what has happened since we last met 18 months ago. Some good news and some a little bit more challenging news. I will start with the good news, guys. The good news is that the logic here is exactly the same as for whatever, the cost elements might be a little bit different. But the logic starts with the same that you need to specify this to the exact need of the customer for long haul or for construction or for an excavator or for a bus summer, right? What we have seen then is obviously, number one, that uptime, availability, safety, but also the infrastructure around will be even more important, right? And we have been early out. We have learned a lot around that, even if it's not scaling yet in Europe and North America, at least, Global South as well. We have also seen that some of the critical cost components are coming down quicker than we anticipated, but also that the global access of that for companies like us, both when it comes to internal innovation and of course, also when it comes to our global supply partner ecosystem is there to a higher extent. And that makes us possible also to continue to develop that. And in particular, of course, battery technology from cell all the way up to pack. But the ability to still tailor-made the solution is there to drive the same type of outcome. What is a little bit more disencouraging about this is that the equation in order to make this happen is going to slow in some of our key markets. Because when we look to this now here, we see that in quite many -- yes, segment by segment and application by application, we are actually getting to a TCO parity or even better in certain cases if you are factoring in the different parameters, city distribution, city buses again there, very [indiscernible]. I mean, we see it very clearly there. We see it in some of the segments also for you melt, et cetera. So that part of the equation is there. But what we see is going too slow for certain other enabling conditions. That's the reason why I talked about enablers before in order to make this happen and in particular, in Europe and North America, but also in Global South, as I said. And I would like to pinpoint infrastructure built out in particular for the public, and that's the reason why the depot type of solutions are going quicker. The energy and the grid network, but also uncertainties about the TCO parameters when it comes to -- and I will give you an example of that here. Here, you see how it looks like now when it comes to the adoption of heavy duty. Zero in North America, 2% so far in Europe and 28% in China. And as you can see, it is pretty closely related to some other factors here. Here, you have the number of charging stations in the relevant areas. And there you have the biggest on the public side and then also how you have decided to drive, so to speak, the pricing on public stations. And when you see these differences, you will not be surprised that you don't have the same adoption level. The trick for us is obviously that we continue to drive that through our modular car system and that we are continuing to refine the products, as I alluded to, with our new BEV and the access to the key technologies here. The other angle of this, if you leave for one second the transformative elements that will be incorporated is, of course, that every -- and this is illustrative, of course. But at the end of the day, it's hundreds of thousands of different applications. And every spot here represent just, I mean, Mac refuse or an excavator customer in Hungary or whatever it can be. And there are no shortcuts. We see some short -- not shortcuts, but we actually see -- that is one of our most interesting, not trials and pilots, but use cases of how we apply digital intelligence and artificial intelligence is we have so much of data so we actually can drive the specification and support our sales force to even better refine that for every customer here. Because at the end of the day, obviously, it will turn out to be all these different type of pie charts. And one pie chart here with different constitutions when it comes to the vehicle or the machine, when it comes to the fuel, when it comes to a lot of different things needs to be really understood in order to make the high performance. And the assets we have to make that happen are, of course, quite a lot. But it starts with that we have a very clear view on how we are operating our brands around the globe. Volvo the Volvo brand, Volvo Buses, Volvo Construction Equipment, Volvo Penta, Volvo Trucks, Volvo Financial Service operating globally. But of course, also that we have our strong regional brands also to further unleash the full potential. Of course, this is not exactly true. We have Renault Trucks in other parts of the world, et cetera, but where we really have the inertia. And that we have very strong retail presence, global reach, yes, but extremely local, being there every day. Segment and application excellence enabled by our common architecture and shared technology. That is the essence how we can incorporate and combine the tailor-making with the scale and the technology leadership, innovation leadership and speed to market. And then, of course, in a world with all these moving parameters, regional value chains. And this is produced based on our recipe for success that we talked about. That customer trust that has been built up for years, a customer base, a growing customer base that is truly trusting that we will do this together, that are living together with us. driving that TCU uptime productivity, safety comfort, all the different aspects of the winning formula for our customers through a decentralized organization with speed and execution, Kina.

Thank you so much, Martin, for giving us a strategic look at how we are going to grow. Maybe we can end by showing the different dimensions of growth.

Yes. I mean you can combine the different dimensions of growth in many different ways, obviously. But we have decided now to talk about it in these dimensions, the growing global demand we have been into. Also and that you will see more about today, how we are targeting specific regions and growth segments with even higher growth opportunities, still combining our capabilities and assets. and how we, through that also can outgrow both the market, the specific strategically selected segments through our total offer and how that finally also will drive content per unit, thanks to the optimization of the solution basically.

And coming to your point, Martin, that part of the resilience that we have created comes from the fact that we are present in so many different segments. And these are segments that we have chosen carefully and strategically and that simply put gives us many legs to stand on. And as I said in my introduction, we are going to focus on the segments today rather than business area by business area, Martin.

Absolutely. And the reason for that is, of course, also that we see a number of these segments coming together where we can combine on one side, our global capabilities, assets, global network with what they need, but also because some of these segments contain enormous opportunity when we are pulling together the capabilities from different business areas. And that is important. And if you look at it, how it looks now, here, as you see then, the growth segments fitting our core capabilities and common assets. The risk is otherwise that we -- and we love that as well, obviously, that we will talk about our on-road freight, we will talk about the construction, maybe we'll touch on some of these others. But when we look at opportunities now, of course, they will continue here, and you will hear more about that, our core segments, on-road, both long and regional haul as well as construction, enormous opportunities. But the compounded opportunity that we see in urban logistics, public transportation and obviously, mining and quarry where we have we are punching under our weight today when we look at our core capabilities and what we can achieve for sure, and we are now focusing on that as well as defense, same here, logistics, autonomous, last mile will play a super important role. Scale will matter with service capabilities. And of course, power generation, it looks 5% here. But now we'll talk about something that I know that you will like how we are growing quickly now when it comes to the AI and data center infrastructure. So exciting times, Kina.

We have a very exciting hour in front of us. I think you have deserved a break now, Martin. So please have a seat, and we will obviously see a lot of you during the day.

Thank you, Kina.

Thank you. So we are going to accelerate straight into our first segment, which is On-Road. So welcome to the stage, Roger. So Roger, let me introduce you like with being the man with probably the highest truck margin in the world. How does that feel?

Certain pressure, but of course, we are very humble for the situation, but also then extremely proud of what we are achieving together with our people and our customers, of course.

And you are present in a number of different segments and is the largest. I would like to leave the stage to you to present how you're going from best to even better.

Thank you, Kina, and good morning to all of you. So at Volvo Trucks, we have a very solid track record of profitable growth regardless of business climate. We have gone through very turbulent times, as you know, but we have continued to drive high profitability. And here you can see on the graph, our strong improvements of net sales and operating margin since 2017. And if you are going back to 2023, we have the strongest record year in 2023 with a margin close to 20%. We are operating from a position of strength. We have taken significant steps as well of improving our market share, but it's not only to improve the market share. We are improving profitable market share. In Europe, we are the market leader for 2 years in a row with a market share of 19.3%. In Brazil, we have grown our market share with more than 8%, and we are the market leader for the fourth year in a row. In Australia, we are keeping up a very strong and solid position. We have a proven track record to grow our market share. Therefore, are we extremely confident that we can do the same journey in North America? Our vehicle population, our truck populations is building resilience into our business. We have a vehicle population of 10 years that is 1.1 million trucks running on the roads every day. The majority of the trucks are between 3 to 6 years old. That is the sweet spot of the highest service potential. If you look at the operating income from Volvo Trucks, we have a high profitability of new trucks driven by strong price realization. But we also then have a very good profitability of the service business, creating a strong resilience into our business, but also that we are extremely profitable in high markets. We will manage high profitability throughout business cycles. Martin was into this, our customers, our fantastic customers. And our business is such an emotional part of our business, and we are emotional as well. But we are working very tight with our customers. We have strong relations with our customers, and we know our customers and their business. We are constantly working on improving customer satisfaction. Today, we have a leading position, and we are winning together with our customers. I will move over to our growth opportunities for Volvo Trucks. And I will go into 4 areas. I will talk about segments. I will talk about the total offer. I will talk about the services and then also then growth in key markets. So let's start with segments in electromobility. We started electromobility in 2019. We have today modules in all segments, and we have 8 modules in production. We have delivered close to 7,000 electrical trucks to 50 countries around the world. These trucks have been driven in commercial operations, more than 400 million kilometers. We have built a lot of competence regarding electrical trucks. We recently launched our next generation of electrical products. improved payload, reduced charging time and then a range up to 700 kilometers. This is a new benchmark regarding the electrical trucks in the industry. Moving over to our fantastic long-haul trucks. This is a new era of trucks into the industry, setting a completely new standard regarding design. They look completely beautiful. Fuel consumption severely improved safety, a lot higher safety system and also then driver comfort. The all new BNL, 10% fuel reduction. The FH Aero, 7% fuel reduction. You can imagine that impact on the bottom line from our customers. We have strong deliveries of both models in production start. And we have an amazing growth opportunities with these fantastic products to gain further profitable market shares. Another growth area is mining, construction and quarries. And here, we are working together with Volvo Construction Equipment. We have a broad range of trucks available into these segments. One is the FMX. That product is proven to handle the toughest jobs in the industry. Here, you can see on the stage, the electrical version. It's a powerful truck that runs up to 470 kilometers. Now I will move over to our second growth opportunities, total offer. I will explain how we are working and the potential with the total offer. We have a customer that operate in a segment. We will provide a truck model and specify that truck and add all the needed features, then we will get a very profitable truck price, but also a product with a high service potential. Then we will add parts, workshops, digital services and uptime and connect that with a service contract, preferable a gold service contract during a long duration period. Next step, we will add financing and insurance from Volvo Financial Services. Now we have maximized the revenue potential of the product, but we have also given our customer a very profitable product with high residual value and uptime. But we have also then a lot of further potential to drive the total offer and gain further revenues into our business. Total offer is a win-win for us and for our customers. The third growth opportunity is services in a growing truck population. We have a truck population of 1.1 million trucks, 10 years old. Every time we sell a truck, we are increasing then the truck population and then the service potential. Total offer. It's enabled us to grow then the service potential and secure them the revenues. And we have grown our service contract portfolio with 180% since 2017 to a value of SEK 70 billion. This is secured revenues for the future. But to manage our service growth, we need a very strong distribution network. And now we are going to build an even stronger distribution network. Today, we have a distribution network of 2,500 service locations around the world. We own 330 ourselves. Our distribution network is a competitive advantage. We have built this distribution network for over 100 years. You don't do this very fast. And now we will build an even stronger distribution network. And we will do that by focusing on strengthening the private dealers. We will then grow organically in selected white spots, and we will do that as well with selected M&As. Moving over to growth in key markets. We have a very solid track record of profitable growth in Europe, South America and in Australia. Now we will take this proven success and scale that to other regions around the world. And let's look into Europe as a benchmark. Europe is an excellent example of very strong profitable growth. We have increased revenues, we have increased margins. We have increased resilience and market shares. We have done that by focusing on profitable market shares, total offer and then growing our service business. We have grown our market share to 19.3%, and we are the market leader for the second year in a row. Our European business is very, very profitable. Now we will do similar journeys in other regions around the world, like in North America. But we can still grow even further in Europe, like in Germany and other countries and also then with services. Another key region for growth is, of course, North America. We will grow in North America now with our new product range, with new capacity in Mexico with services and then investments by our dealers. We are focusing on segment, very focused, and we are conquesting a lot of new customers. And now we are increasing capacity in North America due to a very, very strong order intake. India is also another potential for growth. With the industrial hub in India, we will create opportunities to grow in India and the rest of Asia. To sum up, at Volvo Trucks, we have a solid track record of driving profitable growth. We are acting from a position of strength. We have a proven record to grow our business. We have the strategy in place. We have the products, we have the network, and we have our fantastic people. Now we will take the opportunities in the areas to grow our business even further to be even stronger. Over to you, Kina.

Thank you so much, Roger. Crystal clear, as always. Why don't you join me over here because we are going to dig a little deeper into some of the key areas that Roger presented, and I would also like to ask Stephen to join us. So we are going to focus specifically on North America. And it was pretty clear during our last Capital Markets Day, the market share ambition that we have in North America, 25% combined Mack Trucks and Volvo Trucks. And as Martin said, it has been a fairly challenging market out there. So with a finger on the pulse, where are we, Stephen?

Well, again, if I go back 18 months ago, when we looked at our heavy-duty market share for Mack Trucks, we were running about 6.5%, 6.7% share for about 3 years in a row, really driven by constraints in the supply channel and also some capacity issues. I'm glad to say we've worked extremely hard as an organization to solve those issues. And if I look at 2025 results, we ended up at 8.7% heavy-duty market share. And more importantly, if you look at the last half of the year, we ended up at 9.3% market share. So 6.7% last half of the year in '25, 9.3%, and we continue to see good momentum for market share. And this is driven primarily from just recapturing our business on the vocational side.

That's a good start, Roger.

We see where we are, where we are after May 2026, and we are taking the steps in the right direction. And it's important that we take steps and then growing shares and then profitability at the same time. And as Stephen more into then that we are doing it together in a good way. We are building ourselves stronger. We are rolling out now the products. We are building the network and then capabilities of people as well to handle the higher volume that we are planning for.

And if we go a tiny bit deeper, can you share what we're doing specifically to gain more market share?

No, as I said in my speech here as well, it's important that we are conquesting new customers. We need more customers to gain market share. We need -- we cannot build this with the customers that we have today because we need to swim in a bigger leg, so to say. Conquesting customers, it's super important and that we have the whole network with us to do that. To do that, we need to have more feet on the street, more salespeople to do it. And then when a weaker population is growing, we need to have more technicians. We need to build out the network to cope with and to cope with the higher weaker population and to grow our volumes and the market share.

Yes. I think I said we've got the core business going in the right direction, but there's this long-haul segment that represents 43% of the heavy-duty industry in the U.S. Canadian market, and we've not tapped that yet. The good news is with the launch of our Pioneer and our all-new Anthem last year, we now have the truck to do this. This is a leading technology, 11% fuel economy, ride and drive and comfort are incredible. And the feedback we have from our customers shows that this is a truck that's going to help us recapture our fair share of that long-haul business. So super excited about where we're going with the long-haul truck.

So when we were in River Valley, we showed a photograph of a piece of land in Monterrey, Mexico, where we plan to build a new plant for both MA and Volvo trucks. Stephen, 18 months later, what does it look like today?

Well, I was there 18 months ago with Jens and the team and wow, what a change. I mean, the fact that we've been able to greenfield a brand-new plant, building trucks as we speak and do this on time, on budget, just remarkable. And it just shows the dedication and the passion for our team of delivering this project, which will lead to higher truck sales for both brands in North America.

So as Stephen said and complement to that one, but it's not only the building. You see the building looks just amazing. And here, we will build a lot of trucks then for Mack and Volvo. But it's also then to connect the whole supply chain with suppliers building up that strength and then growing the business and growing then the volume. Jens will come back to that later. But we need to then work end-to-end from our suppliers out all the way to the customers and our dealers. And that is what we are covering now to really make it happen to take the next step.

And Stephen, Roger, you said it in your speech, -- another key area is obviously distribution.

Yes, super important in North America. We've seen a reduction of the ownership, which is important because we have big, strong dealers. We're now about 85 dealers, about 485 locations. These dealers have invested. They continue to invest not only in facilities, but in people, in technology, in inventory, and they are passionate about growing the business.

No. What we are doing is well, we are having a detailed way of working with the dealers, how we are following up the dealers, how we are then tracking them the performance, how we are tracking them that they are doing the investments and then taking the capabilities because it's not enough that we are building a factory. We need to get it out into the distribution, and we need to then get the support of the...

So the building blocks are in place. It's all about execution. Thank you for now, Roger. You will be joining us for the Q&A later. And for you, Stephen, it is time to go a little deeper, looking at how MA Trucks is driving forward to reach our targets, please.

Super. Thank you. Good morning, everyone. Super happy to be here in Eskilstuna, just 6 years, I had the opportunity to be part of Volvo Construction Equipment. So it's good to come back to the headquarters here. But today, I want to talk about Mack Trucks. And I'm really excited to kind of give a direction on where we're going, what's happening and what outcomes are we starting to expect. So in North America, we really have 4 areas or for Mack Trucks, we have 4 areas we're focused on. U.S. and Canada, that is our biggest opportunity. We also have our export market, which I'll deep dive a little bit here in a few moments. We have an Australian business, which is our commercial sales organization, leveraging the Canadian -- or leveraging the Australian dealers that we have access to. And we also have our production in Brisbane. So a really good opportunity for MA to continue to grow in Australia. And then our last opportunity is MA Defense. Today, it's a fairly small operation, but we've been building up because the Department of Defense now has 3 major projects that they'll be bidding on and we'll have a high potential to win some of these business -- our prototypes have gone extremely well. The feedback from the Department of Defense is that we're doing what we need to, to have the right product, and we're looking to bid these out in the next couple of years. These could be 2,000 trucks a year over a 5-year period up to a 10-year period. So lots of opportunity for MA to take advantage of our commercial granite and build out a military product. I would also say that we see -- starting to see an improvement, and I think Roger talked about this in our order intake. The first quarter was very soft on an annualized basis. It's about 170,000 truck heavy-duty market. That's extremely soft. But we are seeing improvement in order intake. We are seeing a small prebuy. And what I'm happy to see is that a large percentage of our orders are sold orders, meaning that we actually have names tied to those accounts. Our dealers are also stocking up for those customers who have not made their lineup to purchase in anticipation of, again, stronger sales. Great feedback from our Pioneer, as I said earlier. One bit of note, 45% of our sales are coming from Conquest customers. So for me, that's a really good indication that we're going to hit it out of the park with our Pioneer and our Anthem. As I said, the feedback has been super good, 11% better fuel economy, much better ride and drive and a much more comfortable cab leading to what we think is the standard in the industry. Also, we launched in Motor Speedway in Las Vegas a couple of months back, our vocational lineup, a renewal of our Granite, which is a key core product for us and also the launch of our Keystone product, which is both an on- and off-highway tractor added to our existing portfolio. So again, more to come, but we're very excited about where we are in the U.S. and Canada for that market. And now I'd like to kind of move over to another slide and talk about where we are from a total market. So if we look here, you can see 28% of our market is the vocational side, 29% is the regional haul side and the largest being the long-haul segment at 43%. You'll see some good growth already in our vocational segment as we've recovered lost sales. And you can see '25 moving from 11.5% to 13.7%. We continue to see good progress here. And again, quite a good order board going into next year. On the regional haul side, again, also improvement as we started to improve our supply base going from 7% to 8% to 11% last year. And again, good momentum going into this year and into next year. And then extremely important for us is the long-haul segment. You can see even in the best of times, a 2.5% market share, this is our opportunity to expand, again, 43% of the market, 2 new products that we feel will help us reach this in the matter of a couple of years. And then lastly, we'll move to the export market. This is an area that we're really excited to return to. We used to have a very strong presence when it came to the export market. We've selected about 18 countries that we're really focused on. But if we were to pinpoint, there's 3 markets for MA that are super critical. The first is Mexico. This is about a 25,000 truck market. We now have Mexican trucks built for Mexican customers, and this will be a game changer for MA. Instead of exporting from the U.S., we'll now have local trucks for local customers. And then, of course, we'll also be able to export those products from Mexico into Latin America. And when I look at the other 2 countries that we're really focused on, it's Colombia and Chile. These are really good mature markets where you have strong fleets that are investing heavily in new technologies, sustainable technologies, -- and so again, we feel like we're now at the right point in time to launch our product going into EU -- sorry, into Mexico that will have both EU5 and EU7 technology to meet the emissions level. So again, super excited. And with that, Kina, I'll turn it back over to you. And again, thanks for your time.

Thank you very much, Stephen. A lot is done, but still much to achieve. Listen, we communicated some time ago that you will actually be joining the next CMD either from your port or maybe the beach. You're picking the beach. I was going to say the golf course, but you're picking the beach.

The beach. Yes. No, again, after 30 years with the group, super successful and be a part of this amazing organization. I think Martin and the team have just done incredible jobs, and I couldn't be more proud. We have an excellent leader coming on board. Wilson Lehman, I've known Wilson for a number of years. He's led the Brazilian market for a number of years, run one of the largest distributors. I'm super excited to work with him in the transition, and I know he will continue to drive the MA portfolio even further down the road. So thank you very much.

Thank you, Stephen. So I have a question for you in the audience. Has anyone been in San Francisco lately, hands up? Malca, you're not -- there we go. Did you try a driverless taxi? You did. In San Francisco or in the other 15 cities in the world where you can find autonomous taxi drives. Autonomous solutions are really happening. And we are now going to spend some time looking at how autonomous is exploding in our business and to help us with that is, of course, Nils. My friend, so since we last met, a lot has happened in the autonomous space. And I was listening to the Uber CEO some time ago, and he was saying that in 15, 20 years, the vast majority of Uber rides will be driverless.

Yes, absolutely. And I think the robotaxis are actually paving the way. They're paving the way for autonomous trucking. But I believe actually that deployment curve for autonomous trucking will be steeper and it will go faster. BCG recently said that by 2035, 30% of all truck sales will be autonomous trucks. So we have something ahead of us.

And we -- that's a great opportunity, and I'll leave the stage to you to explain how we are going to lead the market.

Thanks a lot. Martin has said it already. The global economy really relies on transportation. Transportation, in essence, is the backbone of our economy, but it's also the backbone of our modern society. And putting physical AI on the road through autonomous transport solutions, we are creating new growth potentials for our economies. By that, physical AI turns into an AI, which has a pulse and a purpose. It is the bridge between digital innovation and the physical movement of goods in our society. is about sensing, thinking, acting with a level of precision that never gets tired, that never loses focus. It's about making split-second decisions, safety critical decisions in a world which can be messy in a world which can be unpredictable. We are putting physical AI to work right now, and we are at the brink of making it happen. We will start introducing autonomous transport solutions to the U.S. market. It is a large addressable market. 70% of all goods are already today transported by trucks in the U.S. Last year alone, the market accounted for USD 900 billion in revenues, and it is a growing market. mass customization, urbanization, online purchase pattern that are driving the growth, and it is structural growth. But it is a growth, which is meeting a market which already today suffers from legacy problems, from bottlenecks. It's a market which is set for disruption. We all know about driver shortage. Already 80,000 driver positions are not filled today. It's forecast to double by the end of the decade. The shortage of drivers, of course, that leads to high driver costs. But the human truck driver can only operate 10 to 11 hours a day. Our autonomous truck is always available. We will add significant transport capacity. Delivery reliability is an other well-known industry problem. Our autonomous truck doesn't need a coffee break, doesn't need a lunch break. Our autonomous truck is always available. Our autonomous truck is not limited by legal maximum driving hours. We're enabling predictability of delivery time, and we are enabling constant life tracking of the goods. Road safety, today, very much impacted by driver fatigue, by the reaction time of the driver and the overall human error. Our autonomous truck is never tired. It's always awake. It sees with modern sensors much further than the human eye can see, and it has a constant 360-degree awareness of its environment at any second of the day. That contributes to road safety, and it also supports fuel efficiency, and it will help driving insurance costs down. But we do more than just addressing the pain points. It's about creating new value. That's what Mats Backman said. With our autonomous trucks, we will double the asset utilization. I said it already. A truck today can operate 10 to 11 hours. We can double that with our autonomous truck, 100% more productive. That step changes the economics of trucking. It's a paradigm shift, and you cannot afford not to be part. We're also enabling fleets to grow. If you're in the U.S. today and you run a large fleet, you basically have 2 core competencies, the transportation business and hiring of truck drivers because the turnover ratio of truck drivers in the U.S. is 90% annually. We're fixing that problem with autonomous trucking. Now we have faster deliveries. Our trucks can go further. They can drive longer. And by that, we're taking down delivery time. We do longer distances in less time. The result then is a scalable, capital-efficient, higher-margin transport model with a structural long-term demand from shippers, from carriers, from 3PLs and from transport platforms. The industry forecasts that by the end of this decade, by end of 2030, the installed base of autonomous trucks will be 25,000. But only 5 years later, that number goes up to 220,000. In other words, in less than 10 years, 1 out of 10 trucks you will see on a U.S. highway will be driverless. And that is a consequence of the step change in trucking economics. You cannot afford not to be part. But autonomous trucking is more than just replacing the human driver with a virtual driver. Autonomous trucking is a new transport system, and each transport system has its own ecosystem. And we've built exactly that, and we call it Otona Freight, because the business model, the business model matters. It is a key question. Transport as a Service, our way to go to market will unlock the large-scale adoption of autonomous trucking because we remove the main barriers for market entry. By offering autonomy as a fully managed service, we lower the upfront capital requirement, and we will shift the operational, the safety, the regulatory responsibility away from the customer. We simplify the adoption through a single partner model, a single partner model. If you are a customer, you don't deal with an OEM, you don't deal with a virtual driver company. You don't deal with a dealer. You don't try to find a terminal operator. You don't need to hire operators. You don't try to chase insurance for an autonomous truck. You have one solution. This will drive adoption. And with our approach, we are unique and what we've built, our solution, -- we call it Otona Freight. It is difficult to replicate, and it gives us a competitive advantage. We have invested in this for a couple of years. We know what we're doing. We know this industry. Important is, we're good to go. Next year, Q1 2027, we will start operating. This is our driverless launch. In Q1 next year, we will have trucks on open roads without a human in the cap. And then we will introduce during the year, autonomous trucking to more and more customers. And by the end of Q4 next year, we'll have more than 300 trucks out on the road on the U.S. highway operating autonomously. 2028 and the years above, we will then utilize our strong position, and we will scale, and we will scale at industrial level. Let me summarize. We have a very large addressable market. We have a very strong value proposition. With our solution, we will be 100% more productive. We will double the asset utilization. We have built a ton of Freight, our unique ecosystem, which is difficult to replicate, which gives us a competitive advantage. We are in this business almost 100 years. We know how to manufacture. We know how to industrialize. That enables me to say now that we are approaching our ambition to generate USD 3 billion revenues within 5 years, USD 3 billion revenues, which are having margins, which are accretive to the group. Our agenda, our time line, our value creation is clear. As a brand, we have very solid customer relations, which we can nurture. As an OEM, we know how to industrial, we know how to scale. Volvo, we are a first mover, and we are here to scale this business. And this is what we've planned for from the very beginning.

Thank you so much, Nils. That's very exciting. I have been standing behind my desk there listening, and I'm kind of wondering what's in it for me as a consumer.

What's in it for you? Yes. we were not long ago, we were together in New York, right? -- you remember. And if we would be today in New York and as it's season for strawberries, we actually come back to your enter question, San Francisco, California, that's where the majority of the strawberries in the U.S. are actually grown. But there's a problem with the strawberries in the U.S. in the sense of that it takes 4 days to move them from California by truck to New York. But if you pick a strawberry, the average lifetime is then 5 to 7 days. So whatever you have on your plate then is not really, really fresh. Now the autonomous truck does it in 2 days. So Kina, if I would offer you an autonomous strawberry, would you prefer that over a normal strawberry?

I would prefer going to New York and eat an autonomous strawberry Hills if I could choose.

Thank you. Like...

No, no, no. Thank you so much, Nils. Thank you. He thought he could leave with the strawberries. I think actually I share them with the audience to get some energy. I give them to you. We can pass them around. Thank you. So it is clear that the On-Road segment is looking extremely strong with great potential for resilience and growth. And now we're going to continue with another segment, adding a lot of value to society that is Urban Logistics and People Transport. And I'm sure that all of you have heard the term urbanization. And it is estimated by the year 2050 that 70% of the world's population will be living in cities. And that basically means that all population growth going forward will be urban, adding approximately 2.5 billion people to cities over the 3 coming decades. So with this comes a lot of challenges, of course, but also for a company like us, a lot of opportunities. So to discuss this segment, let me welcome [ Anna Westerberg ]. So Anna, let me start with you. What are the drivers that makes this segment so special?

I mean as more people live and work in cities, there is this increasing demand for efficient and reliable and safe public transport to make this environment function. So here, our solution really matters. And it's also very exciting in this segment because the transition to electromobility is really happening now. Today, 40% of the buses that we sell to the city segment is electric. And by 2030, this will be 80% if we are successful. So a lot of transformation happening here as we speak. And as Martin also shared earlier, in addition to the positive climate impact and reduction of bad air pollution, these vehicles are quiet. So it opens up for new ways of city planning and also make cities more pleasant and attractive to live in.

Do you see the same, Antoine?

No, Kina. I see the same I would say that this mega trend of harmonization is calling for an improved logistic system, primarily on efficiency side, but as well on the electrification side, we see more and more electric vehicles running around the cities. And that's a faster-growing market. And you said it, given the density of those urban agglomerations. And if I take 1 example, as the light commercial vehicle business, which is where [indiscernible] is operating for medium and heavy vans, which is the market size today at around 1.5 million units, sizable in 2025 with an expected growth of about 10% by 2030. And that's a fantastic opportunity we expect to grab.

And I know that urban logistics is very exciting for you at renal that? .

Because a contra really urban logistics has been in the DNA of the company for more than 130 years. When you look at our product range, [indiscernible] has the widest product range in the company and 1 of the widest in the industry in Europe, we are going from 2.8 tons with a small traffic and to more than 50 tons with a heavy-duty truck. And we are offering heavy duty kind of service to our B2B customers. And I would say our customers love it. Our dealers love as well because that's a good complement to our offer. And that's why we believe that [indiscernible] is very well prepared to address this growth market.

And turning to you, I mean, you have been on a fantastic journey during the last [indiscernible], improving and creating resilience in our margins moving from minus now almost 10%. Very briefly, how did you achieve this?

I mean, we've been on this journey. As I said, we call it our performance journey, where we are focused on developing our business and setting a structure where we can deliver sustainable profit over time. And I believe the past years now, we have really proven that our strategy is serving us well and that we have built resilient. We have built flexibility to maneuver various external headwinds while protecting and also improving our profitability. And today, the buses, we have a very solid coach business, representing 70% of our total sales. We have a selective approach in the city bus segment. And in both segments, we are truly driving solution sales. The sale of products and services combined to support our customers with productivity, uptime and safety. And 2 years ago, we completed a structural change to our setup in Europe, where we moved from producing complete buses to focusing on sassy production and working with partners for the bus or the production. And this change of the model have resulted in lower breakeven points and also increased volume capability. And now you have created this position of strength for yourself.

How will you leverage it going forward? And where do you see growth opportunities?

We will continue to focus on profitable growth. We will continue to leverage on our existing structure that is very much set to adjust profit and growth, and we are now operating from a position of strength. We have ambitions to grow, both in the city and in the coats segment. In Europe, we are preparing for substantial growth coming into our focus markets from low levels, but now with new product introductions set by step growing back. In North America, we have leading positions in the coach segment with more than 40% market share, both in Canada, in U.S. and in Mexico. So here, the primary focus is to keep those positions and continue to drive our service business. Then in addition to that, we also have ambitions to grow our business together with our joint venture partner Bovis commercial vehicles, and we will start this year with selected markets in Africa coming in with new product offerings. So a lot of things happening in our company. Coming back to the city bus segment that we were into here in the beginning, the shift to electric buses is happening as we speak. And here we meet fierce competition. So our focus is to continually -- continuously improve our product offers. We can provide the best focal solution to customers so that they in turn can enable sustainable and resilient public transport citizens.

That was a very long list of growth opportunities that you enter. Antoine, you have also made an impressive journey when it comes to improving margins.

No, indeed, the 1 track of today is very different from the 1 price 10 years ago. And Matt mentioned it earlier this morning, then we are -- we have been in strong back figures for a number of here now close to the company target. And how did we do it? And primarily along 3 main dimensions: the first 1 was to leverage our medium and heavy-duty range, which is a strength of the robo group or being part of develop, where we recovered the trust of our customers not only our customers, but we manage as well to expand our market share to 9.5% today in Europe, quite a significant move. And we as well applied a very strong pricing discipline -- pricing, pricing, pricing every day. And as a fact, today, when we discuss residual value, which is really, I would say, the pace of where the brand stays in Europe. Now on trucks in many markets of #3 and in some markets, #4, right? Then that's an outstanding result. The second dimension we've been focusing on is similarly to what Roger Spain is to have a far better service delivery, more consistent delivery to our customers across the network in Europe primarily, but as well in some international markets. We have 1,500 service points, and we want them to offer the same service a total of concepts across the globe. And last but not least, this is what we've been talking about business, which is a bit peculiar in the Volvo Group. We are the only one with this range, and we made it a profitable business with our partnership and co-investment with Renault cars, and now we are cruising at a decent pace and only creaming the market, right? We are not competing with the commodity players. We are more creaming the market with B2B customers which are happy with B2B services, right, uptime, and I would say, on-time delivery.

So you have also created a position of strength for yourselves. Going forward, how will you gain market share and grab those growth opportunities?

Today, we have established a dedicated organization on LCV, right? We are as well developing new solutions, and you see it on that slide. again, applying a similar formula as the heavy-duty trucks. We are now moving to what we call customer adaptation or tailored solutions for our customers. uptime, granting of time. And you need to know that this LCV segment is adopting electrification much faster than the heavy-duty side. we are at 12% to 15% in Europe and with the recent developments in the fuel price, it's moving up. And we are launching with Renault cars in H1 2027, the first software-defined vehicle platform. which was part of Lexis and now it's going to be called Renault, I would say, on traffic etc. And that's coming up soon, very successful expectations since the project is outstanding.

And very briefly, what will this lead to?

This will lead to doubling the business. That's our expectation, doubling the business for in trucks at the horizon profitable today even more profitable tomorrow.

And you know that we will come back on that when you're given number-like...

I'm sure.

And now you talked about competition and competition changing. And the 2 of you are probably the 2 in the group that meet this competition in your -- in the market every day to the most. Still, customers work with you?

Of course. I mean, first and foremost, I think our customers trust us -- when we go into a market, we were there for the long run. We invest in local resources, we build competence, we build local partnerships, facilities we are there to support our customers. And this way of working over many years have built very long-standing relationships and also knowledge of our customers' business. So to meet this competition. Of course, we need to continue to improve our competitiveness, but also to build on these strengths with the local regional presence and the strong global backbone.

Antoine?

I agree with Ana's arguments. I believe as well that the strong network we have, dealer network is definitely a strong asset or said it, 2,500 for Volvo Trucks, 1,500 for Renault Trucks. I mean when you look at France, we have more than 330 service points, that's a clear barrier to entry, I would say, and a clear strength of our footprint. .

Thank you so much for now. Please take a seat. We're going to move into our third segment, which is construction and mining. And we are going to welcome to the stage, the Head of Volvo Construction Equipment, Melker. Where's Melker.

Wow, that was great. sort of being late, but we are in the midst of our [indiscernible] days that we have here in June, 4,000 customers and other partners, talking about our fantastic new products, on new services, i.e., the solutions that we are able to provide our customers with. And Susan here also just can tell you just over there, we are right now building our new excavator plant here in [indiscernible]. [Presentation]

Actually, it was me. I don't I can tell you that yesterday, we had the opportunity with the team here to be out on the playground. And I must say that I was quite impressed by the skills of the team also. So you say close to our customers and by that close our product.

We know how to operate the big machines. So [indiscernible], we have been speaking about the Volvo days. What are the highlights?

Obviously, a big number of customers. Being here for weeks, you were part of a -- little bit of part of that seeing and it will be a bigger part of that today. Of course, we are demonstrating our products, machines, services. But even more, actually, we are demonstrating our hospitality, how we treat our customers, how we take care of our customers, and how we care about the customers' business. And one thing that makes me really proud and happy is the feedback from the customers when we meet our people because we have more than 600 employees engaged in these days during June. And when they meet the product exports, the business experts, they just run it. That is what is it is.

Now we just saw some happy states on the screen. [indiscernible], you have also built a resilient organization during turbulent times?

Yes. I agree.

Agree. And by that, I'll leave it to you to dig even deeper.

Thank you, Kina. I think Martin was quite clear earlier here about the expectations on growth, right? But I would like to start with this slide. We have proven ourselves now when it comes to margins, when it comes to resilience, when it comes to profitability. And as you know, that has been done during a period with a lot of external challenges, external headwinds. On the other hand, that's a lot of things that you cannot in sense. So instead, do what you can influence what you can. So we're taking a lot of actions, exiting paving business. We are discontinuing the [indiscernible] business. And during the autumn last year, we divested our ownership in the JV in China, SDLG. And the combination of this with actions and the earnings and profitability gives us the possibility to invest, to invest in the future, to invest in growth and even more important to invest in the Volvo brand. There are, of course, a lot of different things, people behind the improved performance. But there are also structural reasons. One is our global geographical spread, which is, of course, helpful during many times. Secondly, we are present in all industry segments. Being in all segments is, of course, helpful for us to maintain stability over the cycles. But when it comes to growth, we have decided to have an extra focus on 3 segments: construction, mining and core. And we take them one by one and look at construction. That is today 50% of the Volvo CE revenue. It's Is big, it's growing. Demand, of course, coming from big infrastructure investments, urbanization, population growth. This is actually a very good fit with our investments we are doing in the excavator range and the excavator footprint. Moving into mining. Everyone loves mining, right? We also have mining, big, growing. Of course, energy transition, supply chain security questions, et cetera. In mining, uptime productivity is key. And when I think about it, our products, our portfolio, our capabilities fits very well into mining. And here, I see a big opportunity for expansion and growth, not at least within services. And then we are core in mining, very diversified business, very local business, fits Volvo Sea and the Volvo Group very well with the way of working and our broad network, so to say. And here, I must say [indiscernible] was into it, but the lineup we have in the Volvo Group now, if we take all the BAs, everything we can provide, then we cover a big, big part of the customer needs in these segments. And on top of all of this, all these 3 segments also see or have an increased need of sustainable solutions. I'm quite sure that you all have your projections of these different segments. We have, of course, with the construction equipment plans and some external research, we have our view. And we believe that these segments will have a yearly growth of some 5% to 6%. And of course, our clear ambition is that we should grow quicker than the market here. Then I guess the obvious question is how are we going to do this? And thanks to our heavy investments we have been doing, start with the products. We have renewed more than or around, I should say, 50% of our portfolio. Today, it's bed, it's ice, it's grid connected. And we see now that we have up to 10% productivity gain, productivities done in tonnes per hour. We have up to 13% on the efficiency fuel consumption or energy consumption power, which gives significant better keys for our customers, 20%, that's a lot. We have also invested a lot in new services. Services that help our customers to improve the bottom line, uptime productivity services, site solutions, parts, pay per, we call it equipment acers growing, rental. And I think we can say that we're a little bit proud because we have had a good and profitable growth here the last years. And the combination of this now -- the combination of this is that we have the capabilities now to provide the solution for the customer. The solution for the customer, that is what is the perfect complete customer offer. Another very important parameter for us in the growth journey is our decision to move more into retail. And with the acquisition of recon in the beginning of this year, we now have the direct customer interface in key markets like Sweden and Germany, very important. Of course, this will help us to drive long-term transformation of construction business. But even more important now, maybe this will help us to drive penetration of service contracts, penetration of parts, penetration works of ours. And if you take [indiscernible] now, revenue from own retail moving from 30% up to 65%, of course, give a very, very good position for us to continue to drive the growth together with our customers. We have also taken some decision to invest globally to make sure that our industrial footprint is matching our commercial footprint. Most important now is excavator expansion, excavator capacity. And we are investing SEK 2.5 billion into our main site in South Korea, [indiscernible]. We are investing in shipment store in U.S. Actually, the first excavator was coming out from that plant just a couple of weeks ago, very good for the situation in the U.S. And last but not least, as we speak, we are building our plant here in [ Eskistuna ] in Sweden. And being a Swedish company, being in Sweden today to have the opportunity to prove that we can be competitive building a vehicle plant in Sweden, 2026 is just great. And the regional value chains with shorter lead times will be very important for us in the growth journey. So to summarize, we have created profitability and resilience. We are investing in products, services, retail footprint. We are close to our customers. We are focusing on segments that we know will grow, and we have better possibilities than ever to grow quicker in the market. That's my answer.

Thank you, [indiscernible]. Have a seat. Stay in your chair I'm going to ask you to come up in a little while time. So [indiscernible]. So when working in a diverse company like the Volvo you get lots of different questions from you in the analyst and investor community, from [indiscernible] and from others. And lately, our last 2 segments have gained a lot of attention. It's power generation and in its defense, and we're going to start with for generation. So let me welcome. So Anna. I think it's fair to say that everything about Volvo Penta is power generation. I mean, you are, of course, well known for your marine business, but you have been part of the industrial brand since the very start.

Absolutely. I mean, we love, live and breathe power generation in Volvo Penta. And of course, we are at sea. You all know that. But we are also on land, and we have been that since we as Penta can deliver the first end to the first Volvo car, and that was 99 years ago, so it's not a new thing for us.

And you are an incredibly innovative company.

Yes, we are. Innovation is very integral and important part of the Volvo Penta culture. And we have launched many groundbreaking innovations over the years. And I would say that we have redefined marine propulsion and boating again and again, and now we are also pushing the boundaries with our industrial products with the latest addition, our G17 that is specifically targeted then to power generation and data centers in the U.S.

We are curious to hear your growth story, please. Thank you.

Thank you, Kina. And thank you, and welcome all of you here. So Volvo Penta then, we have grown our revenue -- we have doubled our revenue over the last 10 years. So that's a CAGR of 8%. And that is done with both marine and industrial. Today, Marine & Industrial represents 50-50 of our revenue. And as you can see here, we have done that but increasing significantly the revenue per unit sold. When it comes to the Marine business, that growth is very much coming from that we have increased our scope of supply. So we have from the propeller to the help station on the vessels. We have also grown into larger vessels. And I would say that this is based on our innovation, the IPS system and the features that we have built on the are fundamental drivers for that growth that you see here. When it comes to our industrial business, we have grown volumes and we have, in particular, grown volumes when it comes to our off-road business. We have been successful in growing into heavier application, heavier usage applications being very positive for our part sales, and today, the service business represents 30% of the Volvo Penta revenue and, I would say, still a further growth potential for us as we move forward. And as you can see here to my right, we have accomplished this profitable growth with a very asset-light operating model. So what is then the secret source of Volvo Penta, you can wonder. First of all, the synergies in production and in technology with the Volvo Group are absolutely fundamental for the business model of Volvo Penta. That gives us access to high-volume automotive parts that we can bring to new segments that you can see here to the right and this represents some of our most important segment that we are addressing. Here in the middle, you see Volvo Penta, and we are not only adding innovation we're adding deep application engineering excellence. And we are adding a very close cooperation with our OEM customers. We are investing heavily in R&D on a yearly basis, 7% to 8% over the last couple of years. And we are doing that to develop our solutions to fit all of these segments and the various applications in those segments, all having different drive cycles, different requirements and different emission regulations. So if you pair this with a global commercial presence, a strong dealer network and 2,624 very passionated and very skilled colleagues you actually get the recipe and the ingredients for a successful profitable growth journey. If you look behind me now, you see a couple of applications that are powered by Volvo Penta. We have widened our scope of supply, including everything from the propeller to the stabilization to the operation of the vessel to the services. And this is meaning that we are becoming an integral part of the design of the boat. So we are a true system supplier for our marine OEMs and a true partner. We are bringing those learnings from Marine into our industrial business. And here, we are now launching and we have launched connectivity services, productivity services on top of our traditional services. So this is from this space that we are now taking the next step. And the next step ladies and gentlemen will also be based on the Volvo Group common technologies on innovation and deep application knowledge and of course, a great team. On the on- and off-road side, we are now adding more Volvo Group components to our engine offer to include, for instance, access and gearboxes and again, bringing the Volvo Group component into new adjacent segments. On the genset side, we call our next step, the power of plant. What does that mean? In particular, for data centers, we make now modular solutions to compete with big block power generators: multiple engines matching large engines by competitive by competitive footprint by a competitive deployment cost and maybe even more important availability. On the Marine side, we have been working with multiple installations for many, many years, triple, quadruple. But last 2 years ago, we launched the Power of Plenty concept with our IPS professional system attaching 2 engines to 1 dry. That is also then making us compete with larger engines, bringing us up into larger vessels. It is again Volvo Penta redefining marine propulsion because this is providing our customers with more power, less fuel consumption, more space better maneuverability and flexibility because in the same engine room in the same package, you can select 2 diesel engines, in this case, [indiscernible] on electric engine and on ICE engine or in the very near future to electric engines, so fully electric solution without rebuilding or redesigning the engine group. So what does this mean in practice? That means that the power of [indiscernible] has already opened up high potential profit post for Volvo Penta and for the Volvo Group, like the data center business. And if you look here, you see a perfect example of a Power of Plenty concept. This is a switch data center in outside Las Vegas. I would say it's a midsized co-location. And here, you see 300 G16 packaged in a Power of Plenty concept, providing the backup power for this data center. And the whole integration and the packaging is done by our customer than central power. We believe that the power and the cooling business of data centers will grow with a CAGR of 14% in the next coming 10 years. Today, the data center business represents 15% of the Volvo Penta order book, and I can tell you today that it is growing rapidly. If you look at the marine side, the Power of Plant is making us move into larger assets like super yachts and heavy-duty marine commercial applications. So our ambition is to double our revenue, but not only in the industrial business, also in our marine business, where we see also more potential. And we will double the revenue, the ambitions to do that within the next 5 to 10 years, sustaining a strong profitability and a strong return on capital. So with that, and if you look very, very carefully on the picture here, you see down to the right-hand side, you see a defense vessel. And I believe that is a perfect segue to what we are going to talk about now, Kina.

Okay. Thank you so much. I love it. We are going to segue into the last segment, which is defense. So why don't you do [ Joe ] make it here, and I'll ask [ Antoine ] and [indiscernible] to go. So we opened this Capital Markets Day talking about geopolitics, and I don't think that anyone has missed the need for Europe to build a deterrent defense. And we know a few things. We know that logistics and infrastructure capabilities, they will be key. So we also know by that, that many of the significant investments will be put in our sector. And here, the Volvo Group has a unique position because we can offer a wide range of applications, product services that the defense industry needs. Starting with you [ Antoine ], can you describe the buzz around defense?

Yes. As you said, Kina, we have a number of conflicts, open conflicts in the world, then all the armed forces are observing these conflicts and coming to the conclusion that everyone will have to invest. We have to invest in different equipment, but primarily in the logistic equipment, which are key for those conflicts, right, to bring all the different goods to the front or a few kilometers far from the phone. And that's a clear trend we are seeing that every country starts to have a plan. And I can tell you that I've been visiting many more generals, 4 stars, 5 stars generals in the last few weeks than ever in the past. And they're all talking about investing and need to know as well that they have not invested in logistic trucks for many decades. What we see as well that we see a parting shift in Europe, mostly where they are moving away from tenders of big equipments, I would say, a very specified equipment only for military applications to more trucks coming from the civilian world, lifted up to their needs and ongoing purchases. That's what we see across the world. Entering forward and backward integration as well technologically, that's a paramount for them.

Would you like to fill in Melker.

Just can give a hint or a data point, so you understand what's going on here. And today, we have ongoing business with some countries in the Volvo Group. And the number of countries that we are discussing future business with is double the size of the countries we are doing business with today. So just a flavor of what is going on here.

I guess you recognize this as well. Ana, what are you doing to grasp this opportunity.

No. But I mean we see warfare changing, and I think everybody recognizes that it's more units and autonomous units is what the military is looking for right now. And we see that very clearly, that the navies around the world of Marine is looking for volume and autonomous. And our -- the fact that we are controlling from the propeller to the hand station makes it very easy to integrate an autonomous solution on top of our electronic system. So we are already delivering, and we are gearing up to deliver more and a lot of the dialogues ongoing.

And looking at Antoinne, what are you doing within Renault this opportunity?

For Renault and Group Trucks cloud, I would say that we are -- as I said, we are adding some capabilities on our platforms to really develop military ready platform for their needs. And we are thinking of autonomous, of course, vehicles, but as well unmanned vehicles, which can be cheaper and faster to deploy.

[indiscernible], we said that 1 of the strengths we have is diversity. I mean we can offer trucks, holders, boats, engines power generators, how do we synergize this and go to market as a group?

I mean you're partly input here. But I mean, we have learned all of us, the defense is a lot of logistics. It's on sea, it's on road, it's off road. And if you think about that versus our portfolio, it's a good fit. Then we come to the scale and Defense will not only be extensive specialized equipment. And then we have our system, our production facilities, our volumes, and that will put this in a total different perspective because we also know -- I mean, the drones, you can also think about what does that mean on land. And that in combination with, you said, unmanned, I mean, remote operated and autonomous, all the skills and the capabilities we have will make a lot of defense organizations much more help in the future when they realize what they can buy.

Anna, finally, we also know that the ability to provide services that will actually decide who will be the supplier of the vehicles. What is your take on services?

No, but it's clear, and I think that goes for the group. I mean we have a global, very dense professional service network, and that is required by military, navy around the world to have that. We can also, of course, train them to do certain service themselves, which we do today.

[indiscernible]

The definition of uptime is really in this segment. And I mean, everyone will be talking about that, but the dense network and our service capabilities will, of course, be a super good fit for uptime for a while, at least you don't know how long. But when they're up and running, you need to have uptime.

I believe have time and TCO because as well as the arms need to maximize the use of their budget.

All right. Thank you so much for now to giving your view on the growth opportunities within defense. Please take a seat. We will probably see more of you during the Q&A later. So this brings us to the end of our look of our strategically selected segment. Martin, you have been sitting listening to your colleagues would you like to come up and share your reflections?

Absolutely, Kina. And first, I just would like to say, wow, of the deal. I think it all voice down to people. We say that and it's 100,000 colleagues around the world, but the team here representing all of them is just amazing. The second part I would like to say, and I put note of that today, actually, with Anna saying that scaling Volvo technology by innovation and application excellence through people, that is what it's all about when we take this segment lens onto it because growing underlying markets, obviously, are strategically selected segments, important, where can we really drive growth. And here, core segments, we know that we have the capabilities, we have demonstrated history. And we see now also with the increased focus on certain growth segments such as defense, mining, power generation, power solutions, et cetera. That will also require a part from the capabilities that we have already in terms of our total offer compounded by our technology, the network of people, also partly concentrated commercial organizations that we are combining the strength in order to drive that opportunity. So underlying growth even further in selected segments and then outperforming in these segments. That is the recipe. And I think the team here has truly demonstrated the opportunities.

Thank you for that, Martin. We will see you soon again. And I hope that there is no doubt now that there are a number of growth segments in our markets and in how we also select our segments strategically, this to build resilience and growth. But if we are to capitalize on this, we need one more thing, and that is application excellence to drive technological advancements and to ensure that all our value chains are effective. And to share how we are achieving this. I will present a well known face but with a slightly enhanced scope. Jens? So my friend, you have set into bigger shoes since the last CMD leading purchasing -- well, they look the same purchasing operations and technology how are you planning?

It's still exciting. And of course, great responsibility, and we're living in unprecedented times with moving faster than ever before, but that's also the time to show what this organization is capable of. So...

And what is your comment on those capabilities? -- but we are in the midst of our

It's all about people, and it starts and end there. And whether that is to set up a new plant in Mexico within time, budget, now producing trucks or launching a completely new [ D13 ] platform that we're doing right now or the 700-kilometer range battery electric vehicles. I mean it's done by people every day doing the extra mile.

That's really true. So we are super curious about application excellence. So I'll leave the floor to you to describe how we are ensuring that we have the right product at the right time, at the right place and at the right cost.

Thank you. Starting with application excellence. Again, we said it before, it starts with the customer. And applications excellence and tailor-made equipment at scale is what makes us a little bit unique. I would like to take the opportunity to actually distance ourselves a bit from automotive. We are not automotive. We are producing highly specialized industrial machines every day at stick. And application excellence, we mentioned many times today, what does that really mean? I'll give you some small examples. For instance, we have a customer here in Europe transporting glass, glass sheets from a glass mill. And the glass sheets, they have a certain size and you cannot change that. That means your trailer needs to be bigger. That means also when the trailer is bigger and higher, you need to lower the chassis to have profitability and competition creating a very competitive product and that's what we deliver. Or, for instance, our 38-tonne axle in a quarry or in a construction site, where you add on load in the rear and we measure every axle exactly what the weight is, not to load too much to be illegal and not load too little to not be competitive. That is what we are talking about being application excellence. And these are only 2 points. I can tell you another 10,000 points where we do this in every segment, in every product, everywhere, and we do it at scale. So ultimately, for us, it's about creating [ TCO ] for our customer, uptime, but also productivity. And I would like to highlight also trust, trust we build by consistent performance, but also standing with our customers in good times and in bad times. We do that by servicing our customers. And we are at the point right now where we are delivering 99% of our order lines or spare parts within 24 hours in 180 countries, serving 1.9 million trucks. If you add on the complete group, then we are talking about 3.2 million pieces of equipment. That we can service, we are at the level still at 99% within 24 hours in 180 countries. How do we make this happen? It's by balancing, balancing having scale where scale matters, having speed where speed matters, starting with where scale matters. That is in our tech stack. How do we create the best possible technology solutions? Common architecture shared technology, starting with powertrain solution, software-defined vehicle, vehicle applications or platforms, connectivity and as [ Nils ] alluded to earlier, also autonomous coming into our complete global tech stack. So of course, having that global tech stack is enormously important to have the critical mass to have the speed, the capacity to invest enough in the right areas. But of course, having a big global organization also can make you slow. That needs to be balanced with a regional setup. We are super clear in our regional strategy. We are having application R&D close to our customer, understanding what the customer need, whether that is in a mine in Peru or in train -- a road train in Australia, we need to understand what the customer needs. That means you need to have application R&D on local level. Adding on then local sourcing, but also local production, truly creating an end-to-end system supporting our customer every day. The regional setup is also a way of dealing with resilience. I look at resilience from 3 aspects: financially, technology, geopolitically. Starting with financially, I think we have shown in the last few years, we have created a truly flexible industrial system that can adapt to volumes wherever they are in the world in the 3 -- 4 distinct regions: North America, Latin America, Europe and internationally. Geopolitically, by having this setup where we source locally, produce locally, we are mitigating a big risk that we have with either tariffs or sudden impacts like transport issues or disturbances that we have seen over the last couple of years, shocks to the system, setting up a resilient system. Finally, from a technology perspective, we have set up the system so we can balance up the system, both from an R&D, but also from an industrial perspective, ramping up whatever technology will be needed in different parts of the world, whether that is the combustion engine on different fuels, the battery electric vehicle or in the future, hydrogen. We can ramp up wherever it's needed, dependent most likely on this infrastructure, depending where we are in the world. We are a growing company and starting with our service network. This is -- the points you see here are actually our distribution centers that are supporting the map that Roger showed earlier with our different service centers. This is how we distribute our parts globally. We have invested over a number of years. We are in a good position right now, and that's why we achieved the 99%. Going into our industrial system. Starting with North America. You know we have invested in capacity here. I think we are finalizing. We are in place. Going into Latin America, we are in place. Europe, very strong. We have a very strong backbone in Europe in place. And we are ramping up now our fourth industrial hump India. We have some investments left, but we see that will be handled with more of a normalized capital expenditure. So I would say, very soon in place as well. Looking at R&D. We have invested also here and we have had elevated levels of R&D spend over the last few years. We see now that, that has been peaked, but we have also invested in platforms in the combustion engine, in our long-range BEV, in our software-defined vehicle, but also in the autonomous area. We see now that our R&D expenditures are flattening out. So Kina, we have resilience, we have the discipline to balance between technologies, and we definitely have the capabilities to grow.

Thank you so much, Jens. So I have been standing on many stages with you, and there is one word that keeps coming back, execution, execution, execution. What do you see now in your big organization that gives you a lot of confidence?

Execution gives trust. But it starts and ends with people, and I need to acknowledge that. I'm a true believer in people and what can happen when you have the right people on board. And I would like to take a story about [indiscernible] here. You see on the slide here. She works in our [ shopping ] factory where we produce our gearboxes for Europe. A while back, I met her on the shop floor. We were about to ramp up from a big rebuild that we did. I mean, on the AMT gearbox, that's a sensitive thing. That's where you support the complete European market with gearboxes. And we were rebuilding that to have both our electrical drivelines with our AMT gearboxes on that line. And it's a bit tense, ramping up vertically after a shutdown. It is tense, and she was standing there looking me in the eye, simply saying, failure is not an option. And off she went. And it was a success, by the way. But that is the type of attitude I see everywhere in the organization. I see it everywhere, wherever I go, whether that is to set up a new plant in Mexico, delivering our D13 engine or a service center or our long-range battery electric vehicle. I see that everywhere. And it's hard to beat a winning team.

And I see it in you, my friend. Thank you so much for now. Please take a seat. We will see more of you later. So Jens is speaking about our R&D budget normalizing and us having done major investments in our future. So with such a strong balance sheet, how do we leverage our position? Mats, may I look at you? Maybe you can put some figures to it. You're back.

Yes, you're right. And as you all have heard, I mean, we have been forward leaning when it comes to investments over the recent year, and we are well invested. If we are putting numbers on that and looking at the development we have had since 2019 on this short term. So as you can see, we have increased the R&D gross spending, and we peaked in 2024. And as Jens said, I mean, from the peak 2024, what we're looking on is rather a slightly kind of decline from there or more of a plateau. And R&D is also a big driver when it comes to capital expenditures. We can see a similar development when it comes to capital expenditures, but with somewhat of a delay. So we have been ramping up on the CapEx side as well, and we had [ SEK 18 ] billion in 2025 which is similar to the R&D side and at a peak level and where we see a slight decline in the same way as we have seen for the R&D growth side.

And how does this impact our way of thinking around capital allocation?

We are very consistent when it comes to the thinking around our capital allocation. And the most important part is that we are investing and we are investing being forward leaning in our operations as well. And this has been yielding over time, and we are on a return on capital employed of around 25%. So good returns on the investments we are doing. But in the same time, and this is also you have heard from all my colleagues today, we are forward leaning when it comes to investing in new technologies. But we are, in the same time, sharing this success with the shareholders, and we have been consistent when it comes to dividends as well. Looking at the ordinary dividend where we have been increasing the ordinary dividend with 0.5 over the recent years. And consequent, we will continue to be. And then on the extraordinary side, depending on where we are in the business cycle and depending on the cash flow, we have also been generous when it comes to the extraordinary dividend. And with that, I love to return to this slide. I really love it when we're talking the total shareholder return. And we talked about the positive impact coming from the resilience and the growth, but capital allocation also being extremely important when it comes to the total shareholder return and the dividends we are paying, which is also driving the total returns.

Thank you so much, Mats. I'm sure that we have many happy shareholders. Why don't you join me behind the desk? We are soon going to open up for our Q&A session. We are done with presentations. But first, I would like to ask Martin to wrap things up.

Thank you, Kina. What a great opportunity to present the story. And I mean, maybe 2 messages also if we start with what we have discussed today. Number one, demonstrated demonstration of my colleagues throughout the group about built for resilience and growth. As you have seen here, both when it comes to the reinforced resilience over different type of cycles, but also how we are continuously also tapping into the growth opportunities. And now with the 4 dimensions that we have been presenting through the segment lens, it's time to take the next step for the group. So friends, a day like this, exciting times, right? We are living in uncertain conditions. We know that. But the demand in our strategically selected segments will continue to accelerate. This growth is driven, as we have been talking about today, by the underlying economic activities, obviously, driven by macro trends, but also a number of dynamic factors such as e-commerce, defense, mining, digital infrastructure and beyond. And also, we are coming to the point where we will see the enablement by autonomous solutions and energy transition that provide further growth opportunities. And when growth prospects are good, competition is intensifying, and we like that. In these exciting times, the Volvo Group's capabilities and assets to move ahead have never been stronger because it all boils down to where we started this morning, that every customer will get what they need to stay competitive and successful in their specific segment, application and geography. In other words, in their business, the solution for the customer, a truly competitive TCU, including uptime, payload, energy efficiency, safety, driver attractiveness, productivity and more. This is customer obsession in real life. But it's one thing to have an obsession for customers. It's another to have what is required to deliver what they need. With our global system of own innovation, technology and industrial capabilities, combined with the best and greatest, most reliable supply and commercial partners, we are either developing or getting access to the latest and greatest competitive key components and systems. Competitive both, yes, in terms of cost. But when it comes to the solution, in many cases, even more important when it comes to durability, reliability and performance. Our modular product and solution system, cost, common architecture and shared technology is both fast and flexible and combine scale where it matters with the diversity needed for the customer. And our application excellence leverages our strong regional value chains in both core and evolving markets. And they are, what you say, Jens, these regional value chains, they are ready for more growth, right?

Yes.

So [ Melk ], don't worry, we are ready. Growth driven by a world-class sales and service network that is global when it comes to reach. But on the other hand, and at the end of the day for the customer, it is very local or to put it even more precise, exactly where and when the customer needs us and wants us every day, 365 days per year, always. This approach has led us to a growing customer base that has a huge trust in our solutions and in our people, reflected in our high customer retention and new customer acquisitions. And it's not just trust in the products. By leveraging the total offer, that has led to an increased share of service and solution content, another important signal of trust from our customers. We are working in an industry where the market is growing. We are focusing on segments that will outperform the growing market, and we are confident that with everything we talked about today and much, much more, obviously, we will outperform in these segments, growth, on growth, on growth. And based on these growth levers, our capital allocation strategy has been consistent in providing performance for our customers in reducing volatility and increasing earnings for the group and solid investor returns. This is what we at Volvo call resilient and profitable growth. And it will be done by the most precious asset that we have at Volvo, our people and our partners. You have seen their team, I would like to call it my team on stage today, and I'm very proud of all of you. Thank you, guys, for what you're doing. And I know that -- but we are representing 100,000 colleagues around the world. And I know that many of them are watching online. So I hope that you excuse me if I turn and talk to them for one moment here. Dear colleagues, it doesn't matter where in the world I am. I meet dedicated, dynamic, business savvy. Men, women, colleagues, you. You are living our brands and values. And I know that you're always ready for the extra mile every day in every situation globally, but still extremely locally and all for the customer. I couldn't be more proud of you and what you are doing. Thank you for your great commitment. At the end of the day, it is exactly that. It's all about people, our teams, our customers' teams, our suppliers' teams working together to drive society forward. So everyone online, everyone in the room, thanks for your attention. Thanks for your trust and interest in us. And we are -- we -- that have been on stage today, we are extremely proud of representing all the colleagues around the world. And we are the Volvo Group. Thank you.

It makes me cry. I think we need to catch on a little bit, Martin.

I definitely need to.

It's time for the Q&A.

We are in an emotional business.

Hold on. I see that there are many -- this is good. We have a lot of questions in the room already.

Very good.

So we're going to finish off with a Q&A, and we have a well-known face in the audience, [ Anders ] from Investor Relations. He will help us with the questions online. And we have Mats and Martin by the table. But of course, feel free to ask any questions to anyone in the management team. And we're going to start in the room, and you know the drill, you present yourself and then what? One question each. And I mean it this time because it is respect to the rest of the people in the room. So the question is who would like to begin?

Kina, can I just get my glasses?

Yes, you can get glosses. We have a microphone already here on the first row. Please introduce yourself first question. You made it challenging to just select one.

Daniela Costa from Goldman Sachs. But given it is just one, maybe I'll follow up in the conversation at the very end regarding capital allocation. So R&D is not going up. CapEx is not going up. You're growing more given all these initiatives, hopefully. And I guess there's still some room on the margins, at least in Construction Equipment when we looked at the first chart with the top of the industry and where you are. Is there any room for large size inorganic moves to accelerate all of that? Or what are you going to do further with the cash beyond all that you already do?

Should I start?

Yes.

Thank you for the question. And I think we have been pretty clear in our different type of, if I may say so, inorganic moves over the last couple of years. And when Mats, for example, talked a little bit about the transformative ventures. On one side, you can say, okay, it's profitability, and we want to be transparent. On the other side, you can also say that quite a lot of those are, of course, add-on technology investments that are still about to come on board. We talked about autonomous, obviously. You heard about Nils, we are getting closer to this. We see that in a number of others. The other big part that we see is that it has been good for us to take further steps when it comes to the sales and service network distribution coming even closer to the customer. It is building further growth opportunities for us. both when it comes to the penetration of market shares in these segments, we can do even more. Truck Center Western Australia was a great performing dealer. But with now the integration into the group Volvo Group Australia, we see an accelerated penetration of core segments up in [ Port Hedland ] and Pilbara, et cetera, for example, because we need to combine different things and also the service opportunities. So we are working structurally or very structured around the funnel of opportunities, but with the right balance, that is how I look upon it.

No, totally agree. And I think that if you're looking at the last 12 months and what we have done and especially when we're talking about the dealership and the service focus with [ Swecon ] and Western Australia, I mean, that's the path we are on. So I think that's reflecting the priorities going forward in a good way as well.

And when you look at, I mean, other inorganic opportunities, you need really to see where it can add to your competitive -- I mean, just add units, we don't need because there we have the organic capability of driving that. So the 1 plus 1 adding just to gain size, it must create value for Reel and not being dilutive in any sense, so to speak, because then we are just losing focus.

All right. Thank you very much. Hampus, you have been waiting, so I'll leave the microphone to you.

Hampus Engellau, Handelsbanken. One question. Maybe coming back to the market shares. It seems like [ Mack ] having good momentum on the market share. while Volvo has a tougher task, if I look historically, it's been very segmented in the long haulage with [ Freightliner ] absorbing international market share when they went into trouble. How do you aim to like break into this and capture like clients that never have considered the Volvo brand?

Maybe, Roger, if you would like to take that.

Thank you for the question. And I was into it before. And we need to also then be aware about that the long-haul segment in North America has been down more than the construction segment, so to say. But as I said, we are now building our capabilities. We're widening then the product range which make us more possibilities to grow then the shares in segments that we have not been out in before. But the #1 thing is, of course, conquesting new customers. We are then working with a lot with more sales force, with more conquest from a customer point of view. And the number of customers that we are taking on now that is new one is massive. So we see now a good increase in terms of order intake. So we are pretty confident that this will come in the market share as well.

And I think also, I mean, what Roger said, I mean, you showed it so well, and you have been into it. But when we look at North America, Hampus, as you know, I mean, it's a continent. And we really demonstrate also that we are able to do that. We have, I mean, dealers and markets, as you say, with this. So it's all about granularity and driving that. But I think the platform is there. So we feel confident about that.

Thank you. We will take one more from first row, Mattias. Mattias from Carnegie.

As you probably are aware, there's been a lot of discussions and speculations regarding the structure and if there's potential to make construction equipment into a separate entity. I think you've shown a pretty strong proposition with the cost and service network, et cetera, why it makes sense to have that as a group. But I still think it would be interesting for us to hear your perspective on the structure, if you want to put the discussion to rest, so to speak, or if there might be merit to this discussion, but perhaps a few years too early.

I mean I think -- and Mattias, I think this is, of course, always a very important discussion when it comes to a group like ours to have, I mean, a reflection on how does the portfolio look like? Do you have enough, so to speak, common capabilities, assets to defend the structure that looks like Volvo. I think both when it comes to how we have been developing the group, the different business areas, development, both in resilience and growth opportunities, but also finding the right combination of, on one side, common capabilities of scale or technology or industrial and service network opportunities that really is shared and good opportunity, while at the same time, have enough decentralization, you are not losing speed, focus and accountability and ownership. And we have done a number of moves where we have said that these parts of the business are not fitting good enough into the group. And then it's better for them to develop on a stand-alone or in another context. What we see now, and I think that has been demonstrated, there are -- in addition to the journey that we have done, I think also market and segments reasons to really drive this even further, defense, mining, power generation, quarries, construction as well. I mean, the core construction. So that's the reason also why we, in certain parts of the business now are combining the business area setup also with a segment setup, so we even further can drive opportunities across the group. So we are happy with the structure that we have. And I think also the outcome has shown that this model is working.

Very good. We will take one more from the room. Agnieszka.

Agnieszka from Nordea. So you gave us a very good glimpse into the growth ambitions and kind of revenue pools for your different businesses. Would you consider disclosing more formalized growth and EBIT margin targets for your business areas to improve transparency and accountability from analysts and investors?

No. I mean we have the segment reporting we have and also when it comes to the financial targets. And I mean, that might develop over time depending on how the -- depending on the development of the different segments and so forth. But for now, I mean, we are happy with the way we are presenting the group and the kind of the key ratios and the KPIs we have

Very good. And I think it's time for the first question online. [ Anders ], would you mind?

[indiscernible]. In which regions do you aim to expand in this space?

Yes. I mean, first and foremost, it's important for us to come back to what Roger said. We still see that it's a good combination of having a mix of -- I mean, when we have high-performing, if I may say, so private dealer partners, that is also, of course, a very good model. But we see due to different aspects that there are reasons for us. It could be succession. It could be that we really want to focus even more on a specific segment specific geography where further add-on investments are being made. But what has really changed over the last, I should say, 5, 10 years is our own operating performance in our retail network, both the private and our captive network when it comes to, of course, the financial performance, but also when it comes to driving growth, driving services, driving entrepreneurial spirit, the decentralization. And that combination with the fact that we now have business that are accretive to our margins when it comes to the retail since it's in the same flow and even more recurring business, we see that as a good opportunity. But we will take that step by step. Coming back to what Mats said, strong financial position, drive innovation and growth opportunities and also make sure that we are attractive for -- and that is very attractive, by the way, with the return on capital that we have demonstrated for the investors. And on top of that, dividend opportunities. But this is a strategic area. We are coming closer to the customers. We can drive core segments even further. And I should argue the last 4, 5, 6 acquisitions that we have done have demonstrated that we are -- that it's possible -- not only possible, it's very positive having this bolt-on add-on strategy when it comes to the distribution.

Very good. Let's see if we have any questions on this side of the room. Any hands up? No. Then I'm moving over to this side of the room. Here, we have a few. We can start with. Lots of hands. You're popular now. Two microphones.

Björn, Danske Bank. I keep on asking about the bolt-on acquisition. And if you -- I mean, would it be possible to add 1% or so to growth? Or if you can give some color on the potential for acquiring companies like [ Swecom ] with -- I mean, that drives growth and also resilience, of course.

No, as you say, Bjorn, I think there are a number of things. Number one, it is also from a group perspective, further driving the resilience when it comes to recurring revenues. That's obvious because it's both traditional, if I may say, the core businesses of workshop hours and parts. But more and more solution requires also investment for the retail network when it comes to electromobility, when it comes to autonomous, when it comes to different other type of digital capabilities, et cetera. It is important for our competitive position over time. And it is -- and as I said, when we have done acquisitions and we have a good pipeline and funnel, we see that we are adding growth both when it comes to the products and the services and increasing that. So -- I mean, I will not give a percent, but it's both growth, it's the competitive set because you're even closer to the customer and it's resilience for sure. And I think it's very good for the investors, if I put like that

Very good. We're going to continue on this side of the room. Right here.

It's Nicolai from Deutsche Bank. Also one question on the corporate structure and this time is on Penta. Great journey over the last years. Now you're trying to double revenues. But still from a capital market perspective, Penta is just dwarfed by trucks and construction in terms of earnings. Any ideas here to separate this business, just put it more in the spotlight that we see so much momentum in data centers and power generation?

No. I mean I think, again, we are crystallizing that business very well. And I'm very happy that you brought it up, Nicolai, also because, I mean, it's another jewel in the crown and the growth potential is obvious. I think we have -- and the team at Penta together with many colleagues in the Volvo Group have demonstrated that driving this now segment by segment, of course, the Marine that we thought was rather full leash, but we are unleashing, so to speak, further potential now with the bigger vessels, et cetera. And when it comes to industrial, it's a huge potential. And since we are still in a very high level of growth mode there now, also when it comes to the service business. But when you start to think about, as Anna described also, the core elements in the backbone and then adding on the core capabilities of Volvo Penta and then providing the solution to start to do a separation with a lot of complications will just make the focus put in the wrong place. I mean we are disclosing, everyone can -- you are good in calculating. You can see how much that will add to the group's potential moving forward.

Yes. And we are quite granular when it comes to -- for Penton, and I shared a lot today when it comes to the targets going forward as well then. So I think you have quite a lot of information in order to visualize the value we have in Penta.

But great opportunities. And if you think about -- and I've been involved myself together with [ Anna ] and the teams because I'm really interested in this field with the whole energy transition. And when we look at now the innovation, not only when it comes to the technology innovation, but also when it comes to the business model innovation, availability, scale, when it comes to digital capabilities or electronic capabilities to synchronize all these different type of engine that's not only for backup, but I'm convinced that we will come in also to the prime side of thinking. I mean, if you have 100 engines and you have a smart round robin system also of, so to speak, the maintenance schemes, this is an outstanding solution because with the 16 and 7-liter engines, then if you even drive it on natural or biogas, et cetera, the sweet spot of such a generation when it comes to fuel efficiency and energy efficiency is unbeatable. But it's about the synchronization. And with the capabilities we're sitting on today when it comes to control systems, et cetera, that will, of course, come as well. So here is great opportunities.

Thank you, Martin. I think we can conclude that divestment rumors is a no.

I mean, again, it's all about delivery. The day -- and that what I can assure you, the day we feel that being part of this group is hampering someone from driving resilience, growth, customer satisfaction and outcomes, then, of course, we should consider a different structure. But we feel really good, and we have a lot of discussions in the team. We feel that we have a good structure that gives good outcome.

Clear. Thank you very much. Let's continue in the middle of the room over there.

Harry Martin from Bernstein. I wanted to ask about the autonomous trucking business and the [ SEK 3 billion ] revenue target, that would already be quite a sizable number compared to the size of the U.S. business today. likely implies a higher market share of that business than that 25% target as well. So I'd love to understand some of the assumptions behind that target when it comes to the number of trucks in operation, the market shares, the revenue model and why Volvo as a company should outperform in what is a very competitive end market.

Would you like to start, Nils? Just step forward and it will work.

Okay. It's magic. First of all, as I said, it's a very large addressable market. And if you look at the competition, you need to distinguish a little bit what is the role of the OEM, what is the role of the technology partners. And we have an approach where we work with multiple technology partners, bringing the virtual driver technology, which we then integrate and then we go to market with the Volvo brand, with Volvo Autonomous Solutions. So we are the ones which are generating the revenues. And then, of course, in the back, we are having a certain split of the revenues, which go to us, respectively, what will go to our technology partner. But it's -- what is very important to understand is that in order to bring that technology to the market, you need to understand what the market -- how the market is operating today and how you bring that technology to it. That's why the business model is so crucial and so important. So this go-to-market strategy, which we have where we start with Transport as a Service, here, we're really making it easy for the customers to benefit from autonomy without having the hassle of operating it. Over time, we will add more and different business models where our role will be smaller. But nevertheless, we will still have -- it will still be service business, which will contribute over proportional to the growth we have in the service business and particularly in the margins. And of course, I'd be very happy if with Autonomous Solutions, we overproportionately help the growth of the market share of Volvo Trucks in the U.S. and Roger will support me there.

Absolutely. And I mean, if you look upon it also, one thing, an important thing, by the way, is, of course, the decision engine, the virtual driver. But then it's also, so to speak, the redundant and autonomous capabilities of the whole system and that we have been working really. We have actually had discussions how much should we disclose on this, et cetera, in order to -- from a capital allocation standpoint, et cetera. But we said it's so important that we are actually taking that in our transformational ventures, taking a little bit of heat that we are not disclosing it because we wanted to stay ahead of the curve and do these investments, both in the product, but also in the ecosystem that Nils have been explaining. So now we are really excited for '27 that coincides with our 100-year celebration also. So we're excited about that because that will be a milestone.

Very good. Thank you very much. We have a gentleman over here.

Klas. So I had one short term and one long term, but it's only one question. So it's been a lot.

You will incorporate the 2 of them.

Exactly. Follow-up. So I'm going to go with the one on short term. And Mats, you said that the cost inflation is going to start to bite from the second quarter. We have some hopefully positive offsets. We have the North America volume ramp. You are going to see from mid-May that the under-absorption is gradually going to sort of start to fade. You're raising prices. I'm just curious. First of all, on the cost side, has that got worse than what you planned for? And then on the other things then, North America volumes very strong. So are you going to have a bigger boost from utilization than you originally planned for?

I will not give a margin guidance. But talking about the different components then. So for sure, looking at the kind of the effect from the Middle East crisis and especially on the freight side, I mean, we will have higher cost than anticipated in the second quarter driven by that and in combination to some extent with raw materials as well. So that is kind of a net negative on that side. Then you're right. I mean, we have a good trend and a good momentum in North America with a higher order intake. We are in balance when it comes to our industrial system then starting May. And now we are increasing capacity, as [ Stephen ] talked about as well. So that will help us going forward, so to speak. But please remember in the second quarter, we are talking May, so it's only kind of 1 month left. So that will be a gradual kind of improvement.

But utilization is good, as Mats alluded to also in the trading update. So we see that in the service business also. So I think that is holding up well. And that is, of course, very encouraging to see because eventually, I mean, when customers are active, that is good for everyone. So that is still holding on.

And as previously communicated when it comes to the service business, and I think Roger was underlying that as well then. I mean with the population we have out there and getting into the sweet spot in terms of aging of the fleet as well, I mean, that's also driving the service business in terms of parts consumption and so forth, also being positive. But that's nothing new then. I mean we talked about that when we released the first quarter as well.

The second question. Without a microphone, I have to be super quick because we have one more online before we wrap up.

I mean no changes from what we have said previously when it comes to the pricing environment.

Thank you, Klas. Anders?

Yes, sure. I have a question from [ Mats Liss ] at Kepler Cheuvreux. Following the SDLG investment, Volvo has reduced its exposure to China. Do you see a risk of being underexposed to growth opportunities in one of the world's largest truck and construction equipment markets?

Obviously, I mean, that specific exposure has gone away. But when it comes -- there are 2 elements of this question, I think that is important to bear in mind. Then is the market opportunity in itself. And there, of course, we are continuing to drive the performance development of [ Dongfeng ] Commercial Vehicles, where we have the joint venture. We are also putting a lot of focus now in our core segments also with both Volvo Construction Equipment and Volvo Trucks when it comes to China. But other dimension that is very important, that's the reason why we are also very active in China is also to continuously tap into that ecosystem when it comes to speed and innovation alongside other opportunities that we have, both China for China, as I talked about India for India, but also China for the world where that matters, so to speak. So we are active. We have a strong footprint in these different dimensions, and it will continue to be so.

Gentlemen, time is flying when having fun. That was the final question. Okay. Any final words from you, Martin, before we wrap up?

No, not more than we will be available the whole afternoon, obviously, from management. So I mean, take the opportunity to just grab us, discuss, put questions or provoke us. You do whatever you like as long as we can do it together. And we will, of course, also have more in store now for the afternoon, but that we'll talk about, but we are around for further conversations for everyone.

Absolutely. So this wraps up part of the Capital Markets Day. And as Martin said, for those of you who are here in Esa, there will be plenty of opportunities to ask more questions. Now all materials will, of course, be available online. And there you find the contact information to our Investor Relations department if you have further questions. So thank you so much, everyone, for joining us today here in...

Teams also...

I'm coming to that...

Hope [indiscernible] -- you can take it. Thank the team on.

Thanks to the team that have ...

So thanks to the team. It's a big effort putting a day like this together, as you can imagine. Thank you, Martin. And again, thanks for everyone in the room. Please stay seated because [ Mako ] has some important information. And for all of you who have been watching online, thank you so much for joining us today. I hope that we have been able to keep you glued to the screen. Bye-bye.