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Accordingly, we engage in sales and other marketing activities outside our assigned areas of responsibility and other dealers engage in similar activities within our areas of responsibility.
−Removed: Our dealership agreements with Peterbilt and International have current terms expiring between May 2025 and May 2029.
+Added: Our dealership agreements with Peterbilt and International have current terms expiring between June 2026 and May 2030.
Our dealerships agreements with the other manufacturers we represent generally have terms expiring between 2026 and 2029 or have indefinite terms.
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The commercial vehicle industry is predicted to experience change over the long-term.
−Removed: We see these changes beginning to occur, as certain of the manufacturers we represent now have vehicles with electric drivetrains available for purchase.
+Added: We see these changes beginning to occur, as all of the manufacturers we represent now have vehicles with electric drivetrains available for purchase.
Technological advances, including with respect to drivetrain electrification or other alternative fuel technologies, could potentially have a material adverse effect on our parts and service business, as such vehicles are currently being described as potentially requiring less service and having fewer parts.
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The effect of autonomous commercial vehicles on the commercial vehicle industry is uncertain and could include changes in the level of new and used commercial vehicles sales, the price of new commercial vehicles, and the role of franchised dealers, any of which could materially adversely affect our business, financial condition and results of operations.
+Added: We use AI in our business and challenges with properly incorporating AI into our business and managing its use could result in reputational harm, competitive harm and legal liability.
+Added: We incorporate AI into various aspects of our business and certain of the products and services that we offer, and we intend to continue expanding our use of AI in our business operations.
+Added: If we are unable to effectively integrate AI into our business processes or keep pace with rapidly evolving AI technological developments, we may face a competitive disadvantage.
+Added: At the same time, the use or offering of AI technologies may result in new or expanded risks and liabilities, including enhanced government or regulatory scrutiny, litigation, privacy and compliance issues, ethical concerns, confidentiality, reputational harm, and security risks.
+Added: It is difficult to predict all the risks related to the use of AI.
+Added: Changes in laws, rules, directives, and regulations governing the use of AI may adversely affect our ability to develop and use AI or subject us to legal liability.
+Added: The cost of complying with laws and regulations governing AI could be significant and would increase our operating expenses, which could adversely affect our business, financial condition, results of operations and cash flows.
+Added: Further, market demand and acceptance of AI technologies are uncertain, and our efforts to further incorporate AI into our business processes may not succeed.
Climate change concerns may impact our business in the future;
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Our current business model depends on our ability to sell, and provide services to, commercial vehicles primarily powered by diesel and gasoline internal combustion engines, which produce nitrogen oxide and greenhouse gas emissions.
−Removed: While the manufacturers we represent have made substantial progress in reducing the amount of nitrogen oxide and greenhouse gas emissions that result from internal combustion engines, it is widely accepted that alternative fuel vehicles are necessary to address climate change.
+Added: While the manufacturers we represent have made substantial progress in reducing the amount of nitrogen oxide and greenhouse gas emissions that result from internal combustion engines, it is widely accepted that alternative fuel vehicles will constitute an increasing portion of the commercial vehicles that are sold in the future as technology improves and costs decrease, or in the event that government regulations require manufacturers to produce alternative fuel vehicles.
Reductions in the sale and use of commercial vehicles powered by internal combustion engines creates risks to our historical business operations and we cannot predict the future costs to our business resulting from these developments.
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If we were to experience significant cancellations of orders in our backlog, our financial condition could be adversely affected.
−Removed: Given the current uncertainty in connection with recently proposed tariffs against Canada, Mexico and China, we believe that certain commercial vehicle orders currently reflected in our backlog could be cancelled in the event that such tariffs are enacted and significantly increase the aggregate price that our customers will have to pay for such vehicles.
+Added: Given the current uncertainty in connection with recently enacted 25% tariff on certain medium– and heavy– duty commercial vehicles and parts (the “Commercial Vehicle Tariffs”), we believe that certain commercial vehicle orders currently reflected in our backlog could be cancelled in the event that such tariffs significantly increase the aggregate price that our customers will have to pay for such vehicles.
+Added: However, we are confident that any price increases will be well below the 25% tariff rate and at this time, we do not expect the Commercial Vehicle Tariffs to significantly impact our backlog.
Impairment in the carrying value of goodwill and other indefinite-lived intangible assets could negatively affect our operating results.
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Termination or nonrenewal of our vehicle dealership agreements would have a material adverse effect on our operations, revenues and profitability.
+Added: We are subject to risks associated with commercial vehicles and parts manufactured outside of the United States, and the Commercial Vehicle Tariffs may impact demand for certain of the commercial vehicles and parts that we sell.
+Added: Our business involves the sale of commercial vehicles, parts and commercial vehicles composed of parts that are manufactured outside of the United States, including Canada, Mexico and China.
+Added: As a result, our operations are subject to certain risks of doing business outside of the United States, including import duties, exchange rates, trade restrictions and general political and socio-economic conditions in other countries.
+Added: The United States or the countries where certain of the commercial vehicles and parts that we sell are manufactured may, from time to time, impose new quotas, duties, tariffs or other restrictions or limitations, or adjust presently prevailing quotas, duties or tariffs.
+Added: The imposition of new, or adjustments to prevailing, quotas, duties, tariffs or other restrictions or limitations could have a material adverse effect on our business, financial condition, results of operations and cash flows.
+Added: The recently enacted Commercial Vehicle Tariffs may impact demand for certain of the commercial vehicles and parts that we sell.
+Added: However, the practical implementation and effects of these tariffs, including the amount that such tariffs will increase prices of the products we sell, remain fluid, as the manufacturers we represent continue to work to reduce the impact of such tariffs in numerous ways, including by modifying the location of where certain assembly and manufacturing operations occur.
+Added: While we cannot predict how the Commercial Vehicle Tariffs will impact demand, we are confident that any price increases will be well below the 25% tariff rate on all the products that we sell.
The commercial vehicles that we sell are subject to federal and state regulations focused on reducing engine emissions, and we are dependent on the manufacturers that we represent to produce or supply engines that comply with such regulations.
Laws and regulations intended to achieve the goal of significantly reducing engine emissions associated with the operation of commercial vehicles are complex and subject to change.
−Removed: Currently, the commercial vehicle industry is subject to the EPA 2027 Low NOx and the EPA’s GHG-3 rule, each of which are scheduled to become effective starting in model year 2027.
−Removed: In addition, owners and commercial fleets that register or operate commercial vehicles in the State of California are also subject to CARB’s HD Omnibus and Advanced Clean Truck rules, both of which became effective in January 2024.
−Removed: It is widely expected that the current GHG-3 rule will be revoked or modified by a branch of the federal government, but it is less clear whether a branch of the federal government may attempt to revoke or modify the EPA 2027 Low NOx rule.
−Removed: Recently, CARB revoked its request for a waiver from the EPA with respect to the Advanced Clean Fleet rule.
−Removed: In addition, the EPA recently announced that it has asked Congress to review the previously granted waivers that CARB received with respect to the HD Omnibus and Advanced Clean Truck rules.
−Removed: The current head of the EPA believes that these waivers should have been approved by Congress prior to becoming effective.
−Removed: It is also worth noting that there are currently multiple lawsuits pending where plaintiffs are challenging CARB’s rules on the basis that, amongst other things, such rules are preempted by other federal laws and that the EPA exceeded its authority in granting the waivers with respect to the HD Omnibus and Advanced Clean Truck rules.
−Removed: There are also multiple lawsuits pending where plaintiffs are challenging the GHG-3 rule on multiple grounds, including that the EPA exceeded its statutory authority in creating the rule.
−Removed: In July 2023, CARB and various manufacturers of heavy-duty commercial vehicles and engines, including PACCAR, International Motors, Ford, Hino, Isuzu and Cummins, entered into the Clean Truck Partnership, whereby the manufacturers agreed to comply with CARB’s emission requirements where applicable, regardless of whether any entity challenges CARB’s rule-making authority, and CARB agreed to work with manufacturers to provide reasonable lead time to meet CARB’s requirements and before imposing new regulations.
−Removed: It is unclear what effect, if any, the outcome of the multiple lawsuits challenging the HD Omnibus and Advanced Clean Truck rules, or Congress’ decisions with respect to the EPA’s previously granted waivers, might have on the Clean Truck Partnership.
+Added: Currently, the commercial vehicle industry is subject to the EPA 2027 Low NOx rule, which is scheduled to become effective starting in model year 2027.
+Added: While the EPA 2027 Low NOx rule is expected to maintain the current emission limits, it is expected to be modified with respect to certain other provisions, such as reducing the required duration of manufacturers’ engine warranties.
+Added: In addition, owners and commercial fleets that register or operate commercial vehicles in the State of California were subject to certain of CARB’s engine emissions rules that became effective in January 2024.
+Added: However, Congress recently rescinded the federal preemption waivers that the EPA previously granted to CARB.
+Added: These waivers were the basis of CARB’s ability to enact its own engine emissions rules, and a federal judge has temporarily enjoined CARB from enforcing such rules.
+Added: Congress’ rescission of CARB’s federal preemption waivers is subject to multiple legal challenges, and it is unclear when such challenges will be resolved.
A group of seventeen U.S.
states and the District of Columbia entered into a joint memorandum of understanding that adopts at least a portion of CARB’s emissions regulations and commits each of them to work together to advance and accelerate the market for electric Class 3 through 8 commercial vehicles.
−Removed: Six of the states that signed are states where we sell new commercial vehicles:
−Removed: California, Colorado, New Mexico, North Carolina and Virginia.
+Added: Six of the states are states where we operate commercial vehicle dealerships:
+Added: California, Colorado, Nevada, New Mexico, North Carolina and Virginia.
The signatories to the memorandum all agreed on a goal of ensuring that 100% of new Class 3 through 8 commercial vehicles are zero emission by 2050, with an interim target of 30% zero emission vehicles by 2030, although multiple of these states have recently announced plans to delay various aspects of CARB’s regulations.
−Removed: Attaining these goals would likely require the adoption of new laws and regulations and we cannot predict at this time whether such laws and regulations would have an adverse impact on our business.
−Removed: Engine emissions rules and regulations could affect demand for the products that we sell in certain markets.
−Removed: For example, we believe that the HD Omnibus and Advanced Clean Truck rules, and the uncertainty regarding CARB’s enforcement of the same, resulted in our California dealerships selling less new commercial vehicles in 2024 than they would have absent such rules.
−Removed: While the reduction in the number of new commercial vehicles that we were able to sell in 2024 due to CARB’s rules was not material to our financial results, our success going forward depends on the ability of our manufacturers to successfully supply new commercial vehicles that comply with existing and future emissions rules and regulations in each of the markets in which we operate.
+Added: If CARB were to prevail in its legal challenges against Congress’ recission of the EPA waivers, attaining the goals stated by CARB and the signers of the joint memorandum would likely require the adoption of new laws and regulations and we cannot predict at this time whether such laws and regulations would have an adverse impact on our business.
+Added: Similarly, if the EPA’s policies change in the future, we believe the EPA could issue a new endangerment finding with respect to GHG emissions, which would allow the EPA to potentially create a new rule similar to the recently voided GHG rules, which would have required commercial vehicle engine manufacturers to manufacture an increasing percentage of “zero-emission” vehicles over time, which would likely have reduced the number of diesel ICE vehicles that would have been manufactured over that time period.
+Added: Engine emissions rules and regulations could result in increased compliance costs, additional operating restrictions and affect demand for the products that we sell and services that we offer.
+Added: For example, we believe that certain of CARB’s engine emissions rules that became effective in January 2024, along with the uncertainty regarding CARB’s enforcement of the same, resulted in our California dealerships selling less new commercial vehicles in both 2024 and 2025 than they would have absent such rules.
+Added: While the reduction in the number of new commercial vehicles that we were able to sell in 2024 and 2025 due to CARB’s rules was not material to our financial results, our success going forward depends on the ability of our manufacturers to successfully supply new commercial vehicles that comply with existing and future emissions rules and regulations in each of the markets in which we operate.
Disruptions to our information technology systems and breaches in data or system security could adversely affect our business.
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However, we may not anticipate or combat all types of future attacks until after they have been launched.
+Added: In addition, the rapid evolution and increased availability of AI may intensify cybersecurity risks by making cyber-attacks more sophisticated and cybersecurity incidents more difficult to detect, contain, and mitigate.
If any of these breaches of security occur, we will be required to expend additional capital and other resources, including costs to deploy additional personnel and protection technologies, train employees and engage third-party experts and consultants.
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We could also be subject to potential litigation associated with compliance with various laws and governmental regulations at the federal, state or local levels, such as those relating to vehicle and highway safety, health and workplace safety, security and employment-related claims.
−Removed: We utilize a captive insurance company to provide our auto and general commercial liability insurance, which we supplement with excess insurance coverage.
+Added: We self-insure and utilize a captive insurance company to provide our auto and general commercial liability insurance, which we supplement with excess insurance coverage.
We self-insure the real property that we own and our personal property (excluding our vehicle inventory, which is insured).
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In fact, due to the rising costs of premiums over the last couple of years, we have been generally increasing our use of self-insurance programs and increasing the amounts of our deductibles.
−Removed: We are subject to risks associated with commercial vehicles and parts manufactured outside of the United States.
−Removed: Our business involves the sale of commercial vehicles, parts and commercial vehicles composed of parts that are manufactured outside of the United States, including Canada, Mexico and China.
−Removed: As a result, our operations are subject to certain risks of doing business outside of the United States, including import duties, exchange rates, trade restrictions and general political and socio-economic conditions in other countries.
−Removed: The United States or the countries where certain of the commercial vehicles and parts that we sell are manufactured may, from time to time, impose new quotas, duties, tariffs or other restrictions or limitations, or adjust presently prevailing quotas, duties or tariffs.
−Removed: The imposition of new, or adjustments to prevailing, quotas, duties, tariffs or other restrictions or limitations could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Our dealerships are subject to federal, state and local environmental regulations that may result in claims and liabilities, which could be material.
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The volume of trading in our Class B common stock varies greatly and may often be light.
−Removed: As of December 31, 2024, the three-month average daily trading volume of our Class B common stock was approximately 17,000 shares, with twenty-three days having a trading volume below 10,000 shares.
+Added: As of December 31, 2025, the three-month average daily trading volume of our Class B common stock was approximately 36,000 shares, with eleven days having a trading volume below 10,000 shares.
If any large shareholder were to begin selling shares in the market, the added available supply of shares could cause the market price of our Class B common stock to drop.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.