Daimler Truck Holding AG jumped the most on record after raising its dividend and projecting sales growth to take off in the second half of the decade.

The German truckmaker is forecasting revenue to increase as much as 60% during the final five years of the decade. The company raised its dividend to €1.90 a share after adjusted earnings came in better than expected last year on strong prices for its products.

“We see the transition to zero-emissions vehicles giving us a sales boost from 2025 or 2026 onwards,” Chief Executive Officer Martin Daum said in an interview. “Those vehicles will always be more expensive than diesel-powered ones as costs for batteries and technology are higher.”

Daimler Truck rose as much as 18%, the steepest intraday gain since the shares started trading in late 2021. The stock is up 46% in the past year.

Even as Daimler Truck faces rising economic risks especially in the second half of this year, the world’s biggest commercial-vehicle maker is attempting to leverage its scale into profitability matching the likes of Volvo AB and Volkswagen AG’s Scania. 

Its target is to boost margins above 10% by mid-decade, all while shifting its lineup gradually to electric vehicles. At 9.9% last year, Daimler Truck already came close to that benchmark. 

This year, the company projects a margin of as high as 10.5% — even as it sees unit sales declining. Lower costs for raw materials as well as robust vehicle prices already helped profitability in the fourth quarter.

“The guidance for 2024 profitability is considerably better than consensus,” said RBC analyst Nick Housden. “Even with the market environment cooling off, the company expects to keep margins at a healthy level.”

Truckmakers have flagged that sales will come down from elevated levels this year as supply-chain issues that propped up orders and prices are easing. Volvo said in January it will gradually reduce output to deal with headwinds especially in Europe. 

Daimler Truck sees adjusted operating profit on last year’s level and group revenue of as much as €57 billion ($61.6 billion), from €55.9 billion last year. Demand for heavy-duty trucks is expected to decline in North America and Europe, the company said Friday.

The manufacturer expects rising revenues from expanding in emerging markets such as India, and extending its services offerings in North America. Wider adoption of electric trucks will depend on lower electricity prices and the faster build-up of charging infrastructure, the CEO said.

In October, Daimler Truck revealed a heavy-duty electric truck to take on Tesla Inc.’s Semi. The eActros 600 can travel 500 kilometers (311 miles) on a charge while hauling as much as 22 tons of cargo. The manufacturer now has ten emissions-free trucks and buses in its portfolio.

The company’s adjusted earnings before interest and tax jumped 39% to €5.5 billion last year, better than analysts had expected.

(Updates with CEO comment in third paragraph.)