PACCAR (PCAR) 24 Oct 232023 Q3 Earnings call transcript

Good morning, and welcome to PACCAR's Third Quarter 2023 Earnings Conference Call. [Operator Instructions] Today's call is being recorded. [Operator Instructions] I would now like to hand the call over to Mr. Ken Hastings, PACCAR's Director of Investor Relations. Mr. ahead. go please Hastings,

this would Officer; on welcome is the of and President joining PACCAR's We Executive Feight, phone Harrie Controller. Brice Officer; Ken listening Poplawski, and Director Schippers, me And Relations. those webcast. Chief Investor are like morning. Preston those Chief Financial to and by Hastings, morning and Good My President name Vice

mode. of Certain prior general calls, that presented and in we the members media results. conference any participate risks on affect with may be As a economic will that listen-only information today involve conditions forward-looking line the ask expected and and competitive including uncertainties,

information, page Feight. the additional For would SEC introduce see Investor of Preston filings Relations and now please our PACCAR. I like to

and $XXX I employees the performance. PACCAR solutions delivered with and excellent manufacturing compared to key our period income XX-tonne market DAF year. XX.X% Kenworth Truck, enhanced a the $X.X and greater that increased above Harrie, Other similar projected Brazil you be increased financial recently the range in and quarter operational trucks pretax and will XX% choice. The XXX,XXX trucks market margins recently customers of the heavy-duty Brazilian Ken their be third aerodynamics, The Financial in estimate period in proprietary were delivering year. higher XXXX to the We use the the X quarter, technology operating record The enhances with battery trucks, profits truck as is is update its revenues with PACCAR trucks Class strong XXX,XXX of Parts operational lineup Parts award-winning range innovative and in States Parts year-over-year of Peterbilt highest Europe of and in other offer be range environments. PACCAR and reflecting third located medium we're strong Peterbilt trucks. and business a XX% first strong this to above year's quickly. XXX,XXX customers industry-leading and employees quarter to will United Kenworth million third uptime. PACCAR Financial providing XXX,XXX $XXX DAF quarter in were transportation record economy XX-tonne $X.XX be excited vehicles. Thank XX.X% global future our celebrated premium third and the joint trucks share and for announced third achieve to Harrie superior tenth of elements highlights. range XX% provide expected same morning. the segment industry features excellent fuel the new on and South in investments trucks to Parts for Canadian achieve be expanded and billion will redefined all value this The customers, outstanding and XXXX are same estimated to in exceptionally now in retain of investments create and in PACCAR's its trucks and XXX,XXX portfolio. new the technology in a make XXX,XXX this a trucks. delivering and range million its range record Brice, last last dealers to a to in anniversary DAF, fuel XXX,XXX drivers. Demand will increased future. and a cells year. gross environmental in billion. than update you. have to filling income its their next PACCAR to with performing their and other venture. highlights. PACCAR's cells quality in revenues of to them the year's new industry. to this than XXX,XXX net market and a is a in driver's results new well as that in truck replacing XX-tonne The is high-quality quarter well registrations an to and Services in customers results $X.XX Parts, PACCAR's cell industry-leading battery and will participation XXX,XXX best its are heavy goals. PACCAR's XXX,XXX next this that quarter in pretax a the performance for provides U.S. for Europe, about attract increased their battery enhance segment by efficiencies, PACCAR's be trucks business earned our PACCAR Good the and to are DAF them and manufacture for to joint the year In Peterbilt American Schippers XX%. of year customers, or our in venture help billion. models Customers in Kenworth has economy medium-duty on vehicles.

fourth We of in Thanks, We trucks. to be the to third days Truck quarter improving performance XX,XXX Parts. strong Preston. estimate trucks during similar XX,XXX to third by base be to increased offset fewer production More due days Europe America. of our truck production to continues and and XX.X% North reflecting models the quarter be quarter fourth delivered gross the is PACCAR PACCAR supply margins to in parts the deliveries but fourth close production. new will quarter. quarter. in XX,XXX anticipate around holidays and in the in limit range margins XX%, other The

PACCAR innovative and Management And Management, increase customers Fleet Predictive and Parts helped programs margins Services Parts their PACCAR vehicle XX.X%. Dealer Advanced quarter as performance. uptime Inventory of delivered such financial gross third

part X% the same For the year. sales expect period X% quarter, fourth we than higher in of to be last to

with the Financial and market the The a portfolio comparable is and used quality third the Peterbilt products Financial leader years, Pretax flagship excellent superior benefited innovative truck $XXX in and PACCAR the results technologies million. production Kenworth begins truck quarter that positive global results. time Model in and strong more company's In first supporting Kenworth, the PACCAR Services network. DAF, these from and DAF new was income Peterbilt's new XXX at X in capital than are year. to XXXX. PACCAR's industry-leading in continues investments products in truck million between in have quarter pace $XXX new the many a history. $XXX any the year. Research returns million $XXX introductions and last and of expenses between with facilities, introduced solutions of Peterbilt have used $XXX and year, invested to performing increase innovative years. to $XXX $XXX be $XXX financial million first next increase will will highest an improved for million this development PACCAR's X to months excellent and trucks expenditures million capital transportation be return expanded XX% new million year's industry and and created the $XXX technologies, this the contribute to and projected on models and capital to This further of year. to next million will million

to In the the capital and million R&D the battery X expects years. million to to share a $XXX coming venture addition investments, and over the in joint own $XXX company cell invest will XX%

efficient opportunities, be pleased industry, We questions. services exciting the in the businesses, With is answer the strategic parts future. Thank positioned range to your and PACCAR truck would strong for and investments, new most advanced aftermarket well financial you.

comes question JPMorgan. today first Instructions] from Tami [Operator Zakaria from Our

parts question is So about my first growth.

press PDC said next the in Germany think in year. you're I you release, opening a

rate could reach So parts sort run thinking does color in of how on in we about be about long and helpful. to XXXX some be of PDC give should ramp it you do that, growth think we capacity? would very If a growth that how terms overall? take How

Happy and to start can add Harrie with he wants. that, anything

almost is does to X% shared it think day What in of right? businesses And and their day be in in parts them I more us quick on that next good our for immediately contact the the have with more allows way for or fourth to PDC a growth support effective parts with your think get to delivery. the going to the is closer parts what PDC, Harrie points of point, business, quarter. we you X% it's same customers, is a

to it's them, really quickly beneficial So Tami.

year, about U.S., next truck very in and Canada? we That's both how it. expecting Europe margins sales Got down then think helpful. should And you're given decremental

the products products the in at new we've what to years, few and able our that any as marketplace. the exceptionally more for new think I Those us in and well with we do last time history, Model to we been XXX. doing are introduced in shared we've this continue Peterbilt

with pleased for customers. our we're performing means performing how So that and they're

the first out and on better think And they're for that. market and insights going XXXX. So we the of for margin year value get develops how as we into watch we'll what's getting have lot a next into quarter I

Steve question next from Jefferies. from Our Volkmann today is

talking 'XX, you a is Peterbilt, it the that think of Preston, the trying big launch said, if that? margins How how I is, curious I How I American of much guys was sort with could got do I'm North who changeovers. of just Great. sorry of Okay. revenue of as you about that is big these was launch January think, your engineer wrong. where you in you go And to of launch in to a that? always be? higher I'm this seem new

to trying that might be of a in how tailwind I'm much figure So XXXX. out

customers. exciting in to is looks well, mean, I a the cool. When I The think is what be word engineer first the for to and the introduction it. for we've try value the higher XXX, products. our that new able of industry. all, And it see flagship these I it, the do with think did be well, we will to it Steve, going about was It's just what It team. that's thing Peterbilt right great been iconic it, for fantastic, in it's to we

maybe As to... want far percentages, Harrie, as you

to The And about of the is will it, XXX Peterbilt's think production. now XXX. the XX% good about way Steve a XXX replace

said, of maybe production. And I grow X% So the PACCAR's total more. bit XXX, will even like placed be and little maybe a X%,

Great.

give How Harrie. it follow-up rates seeing in great. Because I bit which that market book. my And headwinds And get I you of but know, curious, obviously, Financial be finance Okay. down we're any the could the on there's some in I'm you color kind that on layer guess, balances, is would some higher on was then income, the little the your a probably in? obviously, is then cash Services, just us year-over-year. do don't great,

quality, -- strong. be very Steve, We to the portfolio continues

than a $XX less past portfolio now. with almost billion have We dues of X%.

that bill, the interest higher environment. yes, payments that payments see customers. more that on higher savings do products So with today's But interest have they do the new launch efficiency, we the fuel better offset higher fuel in rates all drive than for our

Our Dillard Bernstein. next from question is from Chad

rebuilds? engine or into for you tell could what question engine And much visibility first do have look parts So into how XXXX? what your broadly more demand about does is it it you you like

I good the engine. think the pretty life Well, to we visibility of have

Parts our expect an get standpoint. miles to a We parts job are what's time. of a tracking obviously a or is to point over And are see does from going lot on amount then team we as of miles see reaching still manage rebuilds what so fantastic the our of connected, accumulating. we of So utilization increasing the vehicles engine population maturity,

So business. still accretive parts to be the that should

That's to pocket have just approach to the it. a in talk question, your of second can do helpful. Got prebuy air given you that growth ahead about And XX you XXXX in the labor 'XX, the in get managing rebound. and can thinking emission 'XX? maintaining I so start standards a your you want suppliers, sense rates, you're just about for the catch that line probably how could

Yes.

we we've that while make and right with have the guys we we sitting is talking been think is what money little been this I right a there, to research out and to about spend our products for approach you in has sure see do.

that future positioned really sitting terms met markets starting a and people might And line. the I years, think a an that of like pocket to what as kind matters but approach fully heard longer a with in about are think And to That with product air get make into looks for for time before, that then if emissions, So word in your year, see it tell next word we'll got stronger good you. this never it's be we're haven't where newest well able to XXXX we use the what now Obviously, you, was pocket. air of few is XXXX. be I'll could I we're lot. been which a I've

Our question Melius Rob next from from Research. is Wertheimer

Yes. One hopefully, more strategic. market question interesting then

flow through you've a coming sentiment? kind the sort or decline base? the does already of seen So material just in towards outlook along customer on any follow anticipate order is conversations of vocational? with And outlook, what customer in mix it that Or in there your shift does

were do Rob, out strong strong we I see attention market. think market going see I there. very what's a really to on. then a We as years The idea level. customers talking their we the And age you're at and is in mean that Chad, paying keep medium-duty about few the I LTL question market fleet vocational attention strong. sophisticated a that or last from next are to to low the paying want think

So are a cycle and new these as good stay right, for to frankly, to them And a of buying lot saying, there's we've contemplation for them. we trucks said value smart them. on providing keep

looking the we them keep be is trucks. for buying think to to reason think a where all I And forward. going there's that into factors market So

then the batteries debate but future of have higher batteries has your trucks with presumably just investment. And will sticking another on things, autonomy battery and been the the content with moment. just as subject the This Perfect. Okay. other X some and for

trucks some be latter commodity of individually or market. could direction. roll as seems comment it, what I'll by your I this you. by and And when investment the chemistry batteries to more for in of proprietary on nature trucks might stop would you this in to on the those somebody wonder lean you provided designed to if expect to numbers question timing the those start whether there. And actually and else the

want but of you kind give let a were you into come and of me there, lot back an if overview questions in to. There it Yes.

power. what we for as there's employed forward, to So going move is, see of motor a we host we technologies be use how

is we it in and as well, batteries, battery this through be cost be when vehicle diesel We of is battery to to hydrogen whether of obviously did the the that's think part proprietary the into But could be a impacted cells. joint of fuel as highly can cells. that it. a you we it going that cost of or by venture I case create role internal think of And battery. vehicle, clean combustion electric part batteries think the the play going are influenced

energy well to system be more energy our is the in an it the both battery integrated an battery for having we So vertically ability us and advantage, as customers gives think, to as control vehicle. management the the

getting that Obviously, will like space approvals was think felt years few it don't a we we in So important, yet. that be before regulatory involved we and develops. have our

that for And bit like so caution need that in those but we'll give going little good direction. approvals forward-looking, of a a feels we it's

has and earth I the derivative asked rare capability. chosen about of might a LFP, And It we've that a the it's the better chemistry that you minerals. that rely as some of to it of And is more chemistry. then use. on faster technology kinds durable, battery about benefit lithium-iron-phosphate or charge, is we safer it's doesn't life It's think

So better structure. cost a -- and

technology they decision chose just our last reason huge for to So thought path. of factors and we going the this great the those on through and have made who this that technology are credit teams got years several this as us all

next question Raso David from Evercore Our is from ISI.

first comments the quarter Can maybe first how those the give for cadence for to starting then that out the The quickly. U.S./Canada a X% some deliveries? 'XX you us play quarter you to pricing expect sense the is earlier fill industry? of are insight And of on down the about up year-over-year

what quarter. at and if vision you fourth the you think our did that's with shared we think we best, is pricing, I is Well, David, where about

there. as world the key around I that out pricing, XX%. I'll customers in that And But a that's we of a competitive you think focusing filling they on it's gross So say said, making are. been the do it's into realize the quickly. the margin we've expectation gave I obviously. of factors That where is products, sure value And

think having marketplace with earnings as into I pricing what's and going on quarter on So in there. the -- forward it's first to the conversation in the we get you look the

sits. From cadence, is think looks a about how to truckload, moderation think the the trying of that we're people pretty to kind quarter said, think secondary the question I overall that's while may figure there first as seeing, good. I sentiment where in some be of years. And So that next X are out I

this like replacement And so what I don't from look we'll adjustments level. are there know QX, that year, And going stay -- I'm but at not like just smart some a enough feel QX, it to we should demand still QX to like. see

U.S., order The order dealers That's out the now, into far how say, to, book can Canada 'XX? helpful. right

first half. the at Looking

Our from Sachs. Goldman Jerry next Revich question is from

you product if the Europe. portfolio, wonder I new could just talk I in about mean,

of has the it a lineup. portfolio what Is per the the I us have your medium-duty product, fits to on similar think the doubled that new of far us over a profitability Harrie, truck rolling seems for versus product years? possible, this product step paradigm with How be higher of new that we discussion away this proportion couple you front the portfolio of out still of type are higher-margin big we next for rollouts have in to through folks? new

the within we're the DAF But building little to where new DAF aerodynamics was currently And then future. DAF selling export new to trucks customers is want. fuel opportunity outside the is market that's of also are the markets. that DAF for yes, in over trucks the going that I the new an any And to better remember forward, currently planning DAF new what the other we're improved with and selling also bring economy because DAF the sell And XX% product Europe, all trucks a we're building. almost I that would is DAF all say Europe.

with out, opportunity as rolling in for XXX conversation have expand And the that sorry, upgrades So Harrie, can what's book well? folks we the planned? within the America North that remaining you

is like said, production. XXX the Well, I of -- the XXX Peterbilt's is XX%

X%, PACCAR's maybe production. of about it's X% So

So be XXX it as would with today. a the think next the XXX is replacing year, will the similar percentage, XXX I

like? a it sounds pipeline from And there's new for there, products

great Of good numbers ton I'll our course, R&D We there's and we customers bit yes, have that help year. Like what little there think that here. next provide our of to are a for a value see out you shareholders. projects

And so we full. that pipeline very -- is

will electric Once investment, on based up good on consultation And can you how demand concerns your around battery that's are to solving plant for you the in at to ability are the get going scale your ramp going the side. How utilities' up? have and industry really running, Super. product the big producible up Okay. folks I to the you connectivity versus be folks clients do having the ask that you conversations, on keep with XXXX? quickly be effectively think a

point just make factor. puts of make right concerned now. diesel position it or I position less it's investments supporting their the whenever We're now. the solutions, of vehicles. for think a the unknowable engines, right great Energy And we that is factor a have want and this is whether in captured needs have you adoption as factor. that is us or hydrogen well. We'll is great is 'XX So circumstances. regardless is, at Infrastructure great offer as we of is sure curve But vehicles, customers the a is. adoption that in rapid Price if electric Regulation to right? we the about 'XX are a PACCAR our issues factor rate our a EVs. the we

UBS. Steven Our next Fisher from comes question from today

better still in the I TPO investments of us reasons in so quarter gave terms points than XXX you high above expected manufacturing, you midpoint. technology level? but in some mean for what margins the I basis generally margins like Preston, your at was guess much in the and

now was numbers? So there your of just or factors you're those X curious of kind any conservatism into that just baking

we is had some supply of we've the with certainly that. that looking we're I but at think we steadiness as impacts Steven, that shared has you, improving, been from --

factor that's So there. in a

us for I world doing think addition. exceptionally well are that our rest in markets of

just So of smoother a that set had a are probably factor -- us. that's the happened had there And those things. in as And we biggest a we for well. builds probably

this curious it going an Okay. up your from you XXXX. be to helpful. cost indications are that And you does point? think At assume about have have point, what for make sense do higher? then just sort strategy do That's on framing overall costs to this And the generally at I'm as of suppliers you costs XXXX

Yes.

commodities And And see cost I and -- moving think biggest as can look different moving various positioned down that in we'll obviously, XXXX see, I then. right when get see the there's Those we how we're into you some some so are in pressure. that directions, on up. now. think labor that's a looking January we moving at influencers probably

that battery Okay. is or clarification. I does financials? does that R&D just on be a going costs? on mentioned where R&D flow you that Is quick X How -- the to sorry, cost The through? -- plant. the Or new that had part the through of flow

show as won't up part investment will investment the XX% as R&D, of in up show as venture. joint That our an it

next question Thein from Our from Tim Citigroup. is

I 'XX. to press just question, on a thoughts bit Parts little higher in in back, maybe The level come wanted

imagine about obviously in an going Any of coming of that that this Part there 'XX? PACCAR's that give know what you're volumes times for nearly just -- can trucker PACCAR's from I -- think under we're profitability 'XX. environment magnitude. you comes truck that as weird you weighed truck you are pressure. historically, terms that market's declining, there not just been some in and we observe, all for us all But the sales, kind -- comes and kind helped How stocking relationship together maybe pressure, sales Parts year. when in If through can and do developed global but as has just growth profitability on restocking weigh you're but of some was or how -- from thinking this together industry to estimate, look volumes I in an levels where and some inventory But parts declined has you same just back, under not is

Fun to about Tim. talk it. Absolutely,

overarching the valuable it the in So past the their not of it think valuable I several thinking XX And done great roughly that. the really they're what's a over the which engagement is customer to and over they're years. with transportation had -- parts parts dealer. a to I team transitioning right? providers, what's of take I our And view solutions years, about over that's that has they're of job job providers, the lifted growth good was goes they've past they've think foundationally along performance done time, X% per year really the

think through the will of business application over that evolve term and nice and technology I continue. analytics, I that, medium continuing to done that a and really of the continue So expect job the long-term they've

XXXX regard. I heard does. to that at in way, the And... what just you we'll in look well. that said positive everything that And So sensitivity about market, truth as there's

maybe one, both right. and And Fair All at from dealers, an used. enough. level just new your Okay. inventory

where we stocking of in kind do the for question I is a from guess, perspective 'XX. Just dealers the appetite related sit there? And

it does that. where some geography, thoughts maybe Just varies sit? that by on I'm sure just but

Tim. good, Very Yes.

time. You that ask first did the

that now. I in missed limited. kind dealers sitting And Sorry, there level saw We when our a where mitigated probably and like healthy And for of bit. rational for enough was and would things a inventory interest was little I having it. at overstock, in are was I of level destock say think that, to a more back inventory feels strong normal some supply that terms

from next Our from today question Nicole Deutsche Bank. DeBlase is

Maybe starting just Europe. on

Europe but So Canada a of obviously, order the seeing weaker U.S.? an to are for guys outlook relative lot underpinning within that's and a from on of call, about kind this you XXXX talk U.S. perspective what

Yes.

more I feels think here. bit that is economies Europe first what have fill there we're like into the like It moderated than good the over quarter. are feel general seeing they going in we a

And so base the contemplation on going more probably customer there. within there's

makes That sense.

And softer is between that's a year. market correct. The market think for and I there. forecasting XXX,XXX absolutely that's bit little we're why No, XXX,XXX next a

a year. So decline that's of this somewhat to compared

then any hearing a of can major large versus small So versus And fleets? divergence Understood. to you're order the you just what like in customer U.S., speak bit from little medium activity side? in by

of vocational up. said I right there's sector think we strong earlier for it, PACCAR the is North a roughly scale probably It's kind very The sectors exceptionally well like sector are that and of market. spinning Peterbilt a lot in interesting doing of it's America XX% Kenworth just having is that now. in of macro that with

see well. So medium-duty the that's LTL good. see We we market as strength in real well, in market strength real the as some

young of new truck, I As I and shared earlier, and large our the their a think advantage are years about next I do the the think they're right? fleets going thinking at that to the truckload carriers contemplating spot. keeping And what X all for there's customers,

a reasons truck the X% drivers compelling fuel economy, to buy benefit providing it. that love If truck it's plus is in the

in, through it of you things the a So walk those factor and market. the across of sectors gives kind

Elkott from from is Matt question next Our Cowen.

feared. to do peers, X some than My U.S. seems you Class So your decline question have given to have guys forecast, can backlog this your do XXXX U.S. you even that exposure infrastructure of higher and reflects Canada may the is? a than in smaller is, better be it think some forecast than what

the Better terms in forecast of? than

for you're the expecting even industry? the A that smaller decline X% than

in we really strong vocational translate share, XX% into strength year. that have market PACCAR doing well the next Our presence segment obviously should where

able you're to might to relative think -- you do forecast, to the you say industry so or outperform Okay. not that. ready But be

XXX that's it. that's think we the came we to what right? what range I we range see Well, we be, did think out is how the we forecast the with could That's why XXX gave because because

just then more And X Okay. follow-up.

could talk more as vocation you next margins manufacturing if the bit year a have fluidity mix and -- about or process? of mean can do X, for it of you pricing the a higher just If what as in we and of the well kind

our plants, artisans up. that and bringing build an plants truck works for the mean, managing truck mixture and last done job few need it's a build. is trucks years, to I good opportunity, they how world, the are they around being the the our thanks able to amazing it just absolutely and Well, are that at

So be out. at pleased we putting And couldn't the on-highway that's market, any location mix that us. that very for from factories in I into more I very them adaptive we proud and think good trucks delivered. of results our they're those shifts build with truck We that and they've to see need if can the

we So it us will our customers. I for think see -- good PACCAR and won't good and be that, and that shift, that will will -- for be if fine just it it for be

Our is Partners. next Kauffman Research from from Jeff Vertical question

want bit think -- this bit you're a joint venture. little little a want about I to that I Congratulations. think to welcome.

So X you X on CapEx. said questions. Number I guess,

$XXX million said $XXX to million. You

that need, 'XX, Let's thinking about could one. we're all CapEx, in total approvals assume plus you $X at question billion can of that when CapEx? 'XX we terms That's be get that the looking you does of imply firm

if that second one, you do Let's take Harrie, the question, it. go for would then and for can

as So It as an the not $XXX million will our venture joint will to plan. the in show be investment. up investment $XXX capital investment million up showing

are for year next without mentioned venture. So numbers year this joint just the capital the we and

here, XX into Okay. question into future I trucks. I'm something X, I it thinking And can convert want back the at factory. if that the bring to then to But gigawatts

XXX-kilowatt to are smaller XXX, are your I maybe and if of battery. XXX hour trucks gigawatt hour XXX-kilowatt batteries XX and trucks larger kind think So of your

up other battery kind to would that an income of that that, XX,XXX interest XXX. you have going I'm joint this XX% and talking about average shows to in So Are venture? a just XX,XXX could of vehicles investment plant as in theoretically a take year then we

that Jeff, is Yes, perfect math.

you future the can to back you can use that. probably that think and I go with

last Our Wolfe from question Group is Scott registered from Research.

just the mix to I large change your wanted there XXXX is on or is So mix of mix What just that lower? trucks, within up in versus And higher of earlier the X Is going follow with percentage the MX typically the questions. then any of not? truckload? sales

X think I the the in the segments that. see they a of within the put greater is XXX then could a if up and you of than then think I mix a you vocational Class I that right? being next split combined, fleets it, midsized and behind obviously of LTL big markets. the On part I get is into it, like of at of vocational is asking over-the-road part that as part is sales, the of you're it then you the look can the mean, customers that biggest and is of LTL And the in you think truckload variance part kind kind model,

percentage of of we So that's worry really them. each how will think such we because through what it, of between and the there's overlap don't kind be

you're penetration And 'XX selling -- then again the unchanged? for of in higher, MX what if any changes is lower,

as And year, great be on constraints going And really XX% this MX that, working Yes. we there's year. the quarter. doing it. We've our of the is engine we build think to upside right? to see through well work We think next was supply for that expect next that we It been through quarter in growing.

from loss on FinCo the Any to here, think bit. little margins up a how FinCo But how provisions we think about here? Okay. color do from about

continue that's in year. the losses portfolio. a to to billion the $XX quarter should the really very total Credit but small were next fourth million be almost quarter, Finco $X in number and strong

quality. the excellent expect I continue we company to And said, like do well. finance to So credit

gross year back big had could margin. about a But going And Okay. I is XX if -- and be over ask to then you questions there's X lot you've this XX%, it's picture. just at year know I go never over XX%. a been never just more, years, of

what been think forward? is lot guess you talking that you a about. right range do margin what the new what's would -- cycle it's you've of through gross for the I PACCAR going about So think a

seen succeeding think that. incredible because that I is in and people every reason margin PACCAR Well, working there the team they're customers It's that huge of a of our at to are give great an gross part that we've it. value, is day

think fantastic in as the are have seeing great job. network. And We I value doing our a dealer They're a that customers well.

that to that. the up. that's continue aim So overarching driving deliver we it are and to on things

can't the it I and for comes It risky. we'll depends a how everything And what be it future think predicting at little look to else, pleased through. cycles gets with but will I the be and is deliver. on the PACCAR positioned future able more how

Thank today. you. we have questions the This is all

So remarks. any management I'd for like to hand closing back to

thank everyone like to you, operator. We'd thank for joining call, the and

you, Thank everyone, for joining today's call.

may lovely and a have You lines, now disconnect your day.