The origins of Scania go back to the late 1890s, when Peter Petersson – works manager for steel company Surahammars Bruk – convinced the Board of Directors to initiate a carriage-production line on their plant in Södertälje, near Stockholm. The business went well for the following decade, with plenty of customers filling the request list – from both public and private sectors.

The new Vagnfabriksaktiebolaget i Södertelge was allocated the manufacturing of 150 carriages per year (1904) as a result of the Swedish State Railways deciding upon the production of all carriage producers countrywide. If it were to survive only on selling carriages, the company would have probably been declared bankrupt in a couple of years. The salvation came from the same Petersson who, some half-of-decade earlier, had asked engineer Gustaf Erikson to develop engines and engine-powered carriages. Erikson had practically built the first Swedish car in 1897, but the vehicle lacked major reliability for the following years.

Vabis railway carriage In 1902, Erikson finally designed a well-functioned truck powered by a petrol engine and a 2-speed gearbox. A year later, Ystad-Eslöfs Järnväg AB placed the first order for a Vagnfabriken vehicle, fitted with a one-cylinder 3.5-bhp engine.

A new factory was built in 1907, purposed to manufacture engines and automobiles. A year later, the Vagnfabriken was shattered by the death of Peter Petersson. Nevertheless, the company continued to pursue his plans and developed a brand new 3-ton truck the very same year, which later won the Swedish Royal Automobile Club award in 1909. Despite manufacturing big and reliable trucks, the market didn't respond too well to the new line of commercial vehicles and requests hardly reached 5 units per year.

Following this financial disaster, the Surahammars Bruk decided to sell the Vagnfabriken as soon as possible. They finally found a buyer in Per Alfred Nordeman, none other than Managing Director for Malmö-based Maskinfabriks-aktiebolaget Scania. His company had started out years before in the bicycle sector, before moving to car assembly in the late 1900s. An agreement was reached between the two companies and the new AB Scania-Vabis was formed. The engine, car and light utility vehicle production was moved to Södertälje, while the truck department remained in Malmö.

During the following 5 years the company's profits stagnated, with almost 1/3 of the sales coming from exports. Then the First World War started and most of the truck and automobile production had to serve the Swedish Army's interests. In 1916, once the company's profits raised, Scania-Vabis decided to reinvest in developing their plants in Malmö and Södertälje. Soon after the war ended, in 1919, Scania focused completely on truck-production and abandoned its other commercial-purposed vehicle manufacturing (from cars to buses and firefighting vehicles).

Unfortunately, this new marketing vision didn't work out very well for Scania. Only months later, due to unstable financial situation, all top executives had to resign and a new managing director was appointed to replace Per Nordeman. The following years were a constant struggle for survival, as most of Scania's customers left and the new production line didn't have the power to challenge the imported trucks. Then, due to several plants filing for bankruptcy, Scania faced complete termination in 1921.

Scania-Vabis 2.5-tonner Following the foundation of a brand new company – bearing the AB Scania-Vabis old name – the engine department was restored and progressively started to bring in profits. August Nilsson stepped in as design engineer and helped launch a new design&production department within the company. The Swedish Post Office was AB Scania-Vabis' first client after the reconstruction, ordering the production of 15 buses in 1922. The vehicle had a 12-seat capacity and later featured rubber tracks for winter use.

During the mid-'20s, AB Scania-Vabis managed to develop some outstanding engines. Their engine development program started out with a brand new compact four-cylinder overhead valve engine (producing 60 bhp) and continued with an incredible six-cylinder variant of the same engine having a maximum output of 100 bhp. At the same time, Scania produced its first complete line of trucks after the war, featuring new propeller-shaft drives, wet disc clutch and progressive suspension. The company started producing up to 100 units a year and, soon enough, shareholders were finally collecting on their investment.

Following a visit from chief-designer August Nilsson to the Twin Coach factory in Ohio, USA, Scania-Vabis began developing a new line of bulldog buses (similar to the US coaches). Despite registering a significant fall in truck sales in 1932 – due to the Great Depression – the new bus line managed to stabilize its profits and helped maintain the company alive through those difficult years. Little by little, Scania-Vabis developed into a bus-manufacturing company, with little contact with the truck or engine sector.

The '40s began with a big change in terms of company management. Carl-Bertel Nathhorst was named new managing director of Scania-Vabis, with a main task to turn this company into a powerful international player. His first step was to hire a new staff of young talented engineers who could perform well in specific production areas.

Just as the company succeeded in drafting enough young mechanics (possessing school degrees) to reorganize and further develop their production line, there came the Second World War. Scania-Vabis was again forced to supply the Swedish Army with the necessary trucks and other military-purposed vehicles, suspending the work for the much-awaited civilian line. Nevertheless, the diesel-engine powered military trucks brought great profits to the Södertälje-based company.

Scania-Vabis 335 Series Starting 1943, Scania-Vabis began redirecting its production process towards the civilian-truck and bus sectors, developing new chassis for the upcoming line. The first truck produced by the Swedish manufacturer in the post-war era was fitted with a 4-cylinder engine. The company decided to speed up its production process to benefit from the foreign manufacturers' breakdowns, but that turned out to be a big management mistake. The new designs were left untested before the assembly process, causing most of the trucks to develop mechanical problems and return back to the repairing shop.

From that point on, Scania-Vabis took on another approach. The first step of their new policy was to fix the existing problems with the models and then repair the trucks on their own expense. Soon enough, things went back to normal and the company entered the new decade with a plan to extend its truck line even more.

The Regent model was introduced in 1954 and it marked one of the most important year in the history of Scania-Vabis. Even if the company lacked strong organization and structural coherence, it's new model would now battle giants Volvo on the Swedish market (sales were up by more than 500% as compared to the post-war era). No doubt about it, a strong reason why that happened was Scania-Vabis becoming Volkswagen's importer on the Swedish market starting 1948. This enabled the Swedish manufacturer to contract a high number of dealers countrywide – offering them a wide range of vehicles, from Scania trucks to Volkswagen passenger cars – and extend their production line.

Scania-Vabis L76 with semi-trailer Scania-Vabis quickly became one of the strongest players on the Swedish haulage market, as well as on the export sector (representing at least 50% of each market). The company adopted the same recipe in order to increase their export rate, creating several partnerships with independent importers worldwide. Its most successful such deal was signed with Dutch importer Beers, whose market share of Scania-Vabis trucks in the Netherlands increased to 20% by 1957. A year later, Scania completed its engine range with a 10-litre turbocharged diesel engine, producing 205 bhp.

The 1960s marked the beginning of a new era for Scania-Vabis. Realizing that using a single factory would not help them extend their production line, the Swedish manufacturer started making plans for developing new plants countrywide or outside Sweden's borders. The first one was developed in São Bernardo (Brazil) as a result of a serious increase of sales on the Brazilian market – heavy-duty trucks and buses in particular. The production process here was to be developed and marketed by a brand new independent company.

A second plant was built in the Netherlands (at Zwolle), following the company's great success in the region. Then, following Scania-Vabis' decision to build their components in-house, the necessity of building a new factory arose. But, instead of building a new plant, the company went on to buy the Swedish company Be-Ge Karosserifabrik. It's factories in Oskarshamn and Meppel would go on to manufacture cabs and cab-related components. The bus production line was moved to Katrineholm following Scania-Vabis AB's purchasing the Svenska Karosseri Verkstäderna coach-work company. Scania production line 1996

In 1969, Scania-Vabis AB was acquired by Saab and moved all its production operations in Falun, Sweden.

Scania launched a new 14-litre V8 engine in the late '60s – producing 350 bhp – that made them a top contender in the long-haulage sector. The newly-powered line of trucks made them enter the difficult French and German markets, where the latest laws required a minimum of 8-bhp per ton of gross weight. More, after Sverker Sjöström stepped in as technical director, Scania improved its truck design line, better the transmissions types and increase engine's output.

Scania launched a new generation of trucks in 1980-1981, within the 18-36 tons gross weight range. Some half-of-decade later, under the technical guidance of Stig Ericsson, the company introduced the 3-series, which later won the 'Truck of the Year' award in 1989.

The '90s meant a new reorganization of Scania, whose management department distanced itself from the technical one. During this decade, it was decided that all factories and production companies around the world were to report to Scania's management department. Also, all operations including engine&components aimed for the European market were transfered to Sweden (Falun, Södertälje and Oskarshamn). At the same time, a new assembly plant was built in Tucumán, Argentina, to further develop the market in Latin America (joining the factories in São Bernardo do Campo, Brazil; San Luis Potosí, Mexico).