Oct 21 (Reuters) - PACCAR Inc ( PCAR ) on Tuesday

reported third-quarter profit below Wall Street estimates, as

rising tariff-related costs and a sharp drop in truck deliveries

pressured margins.

The company, which produces trucks under the Kenworth,

Peterbilt, and DAF brands, has been facing elevated tariffs and

rising raw material costs.

The trucking industry, heavily reliant on imported steel and

aluminum, has been burdened by escalating costs following tariff

hikes on these key materials.

"The new Section 232 truck tariffs that are scheduled to

begin in November should bring clarity to the market in the

coming months," said CEO Preston Feight.

Under Section 232 of the Trade Expansion Act, the Trump

administration recently expanded tariffs to cover imported

medium and heavy-duty trucks and key parts, imposing a 25% duty

effective November 1 to encourage domestic production.

Feight also said the company manufactures over 90% of the

trucks it sells in the United States at its facilities in Texas,

Ohio and Washington.

Truck deliveries fell significantly during the

June-to-September period, dropping to 31,900 units from 44,900 a

year earlier. The decline was most pronounced in North America

and Europe, reflecting softer demand and potential inventory

adjustments by fleet operators.

PACCAR's ( PCAR ) fourth-quarter margin target may be hard to meet

due to weaker truck deliveries and limited pricing power,

Jefferies analysts wrote in a note.

Net income declined to $590 million, or $1.12 per share, for

the quarter ended September 30, from $972 million, or $1.85 per

share, a year earlier.

Analysts had expected earnings of $1.16 per share, according

to data compiled by LSEG.

Quarterly net sales and revenue came in at $6.67 billion,

above analysts' average estimate of $6.38 billion.