Stellantis N.V. (STLAM) Earnings Call Transcript & Summary

Hello, and welcome to the Stellantis First Quarter 2023 revenues. My name is George, and I'll be your coordinator for today's event. For information, today's call is being recorded. I'd now like to turn the call over to your host, Mr. Ed Ditmire, Head of Investor Relations of Stellantis. Please go ahead, sir.

Thank you, and welcome to everyone joining us today as we review Stellantis revenues for the first quarter of 2023. Earlier today, the presentation material used during this call, along with the related press release was posted under the Investors section of the Stellantis group website. Today, our call is hosted by Richard Palmer, the company's Chief Financial Officer. After his presentation, Mr. Palmer will be available to answer questions from the analysts. Before we begin, I want to point out that any forward-looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the safe harbor statement, including on Page 2 of today's presentation. As customary, the call will be governed by that language. Now I would like to hand the call over to Richard Palmer, CFO of Stellantis.

Thanks very much, Ed. Good day to everybody. Happy to be here today to discuss Stellantis shipments and revenues numbers for Q1 '23. So starting on Page 3, we present a summary of the operational and financial highlights for the quarter. After delivering record results in our first 2 years of Stellantis, we entered year 3 with great momentum and focused on the execution of our long-term strategic plan, there forward 2030. We posted strong Q1 net revenues of EUR 47.2 billion, up 14% against the prior year, thanks to a 7% increase in consolidated shipments and continued pricing discipline with all segments posting year-over-year increases in net revenues and positive pricing. On a year-over-year basis, we saw a market share decline in North America and EU30 by 160 and 170 basis points, respectively, but we improved versus Q4 2022 and expect the current level of inventory and commercial actions from our teams to support further progress in those markets. Our market share grew by 20 basis points in South America and by 230 basis points in Middle East and Africa, highlighting the success of our strategy to expand our presence in growing markets and the competitiveness of our global brand portfolio. Our global LEV sales reached 137,000 units, up 25%. And within those, our BEV sales grew 22% to 73,000 units. Our PHEV sales progressed by 29% to 64,000 units with a strong performance in North America pushed by the continued success of the Jeep Wrangler, which is the #1 selling PHEV in the U.S. market. In addition to the progress on electrification, another illustration of our progress against our strategic objective is our third engine, which is internally how we call the aggregate of South America, Middle East and Africa and China and India and Asia Pacific segments, the global growth markets. It contributed EUR 6.7 billion to net revenues, 26% more than the prior year and represented about 14% of our total net revenues for the period. With regards to capital allocation, we approved the distribution of EUR 5.7 billion in aggregate to our shareholders in 2023, including tomorrow's EUR 4.2 billion dividend payment and the execution of our share buyback program of up to EUR 1.5 billion with the first EUR 500 million tranche expected to be completed in June 2023. And finally, we have confirmed our full year 2023 guidance and affirmed our 2023 industry outlook. Moving to Page 4. We present the shipments and net revenues for the group. As mentioned before, our consolidated shipments increased by 7% to 1.5 million units, and this was primarily the result of an improvement in the fulfillment of our semiconductor orders compared to Q1 last year. We continue to gradually reduce the level of production losses related to semiconductor shortages, and we expect supply to continue normalizing as we progress through the rest of the year. Importantly, net revenues grew twice as fast as shipments being up 14%, with further positive pricing impacts coming from carryover pricing. Moving to Page 5. We show the net revenue walk from Q1 '22 to Q1 '23 and the EUR 5.8 billion top line improvement. At a segment level, North America accounted for 36% of that growth, while in large Europe contributed for 26%. Our third engine brought a 24% share of the increase, of which 13% came from Middle East and Africa and 10% from South America. Looking at the various drivers at group level, volume and mix contributed positively for EUR 2.7 billion, of which EUR 1.2 billion came from in larger Europe, driven by both higher shipments and mix improvements, while North America contributed EUR 0.5 billion with a positive impact from higher volumes, partially offset by negative mix. Middle East and Africa and South America each brought an additional EUR 0.4 billion due to both volume and mix improvements. Vehicle net price was positive for EUR 2.3 billion due to favorable carryover pricing in all segments and compensation for currency devaluation in Turkey. FX translation bought another EUR 0.5 billion with about EUR 1 billion positive impact from a stronger U.S. dollar and negative impact from the devaluation of the Turkish lira. Next on Page 6, we look at the segments individually, starting with North America. The industry was up 9% year-over-year. And as commented earlier, our market share was down 160 basis points to 10%. While our market share improved sequentially, Q1 was the strongest quarter of 2022 due to the availability of the prior version of the Jeep Grand Cherokee. The drop year-over-year was primarily driven by the discontinuation of this prior version as well as lower angle sales. Partially offsetting this was a 34% increase in Dodge brand sales and as a result, total sales decreased by 6.5% to 432,000 units. Consolidated shipments, on the other hand, increased by 6% to 509,000 units and consequently, our dealer stock increased remaining at around 69 days sales at the end of the quarter. Shipments growth was primarily driven by higher volumes for Dodge and Chrysler models and for the Jeep Compass and Ram ProMaster partially offset by less Jeep Grand Cherokee units. Revenues were up 10% to EUR 22.8 billion, with main positive impacts coming from volume up 6% pricing up around 3% and positive FX translation, while mix was negative, mainly due to a higher share of fleets in the United States and significant increase in Jeep Compass volumes. Turning to enlarged Europe. The market increased by 16% in EU30, mainly due to easing supply chain constraints and a particularly low base comparison period. Our sales in EU30 grew by 7% or 45,000 units. And as a result, our market share was down 170 basis points to 19.3%. Nonetheless, it represented a sequential improvement of 190 basis points as we made progress reducing logistical issues around delivering vehicles to final customers. Our consolidated shipments, on the other hand, increased 6% to 657,000 units as we benefited from initial demand for our newer models, such as Alfa Romeo Tonale, Peugeot 408, which complemented higher volumes for key models like Fiat 500, Peugeot 308, and Opel Astra and Corsa. Our bank shipments in the region reached 88,000 units with increases for the Fiat 500 and e-208. We also remain the clear leader in the commercial BEV segment in EU30 with more than 13,000 units sold, up 57% year-over-year and achieving a 43% market share. Net revenues increased 10% to EUR 16.1 billion, driven by the higher shipments and favorable mix due to increased [lead mix] and the combination of less A&B segment vehicles and more upper segment vehicles on the newly launched vehicles. Vehicle net price was strongly positive, up around 7%. And Other impacts were mainly due to higher buyback revenues. With regards to Middle East and Africa, our sales increased 36% to 126,000 units, while the industry was up 12%. Our market share improved by 230 basis points to reach 13.4%. Being a market leader in Turkey, we were able to capture a significant part of the 55% market growth, more than doubling our sales while improving our market share by almost 10 percentage points to reach nearly 40% share in the country. The sales increase supported our consolidated shipments across most brands and in particular for s Peugeot, Citroen and Opel to bring our total shipments in the region to 83,000 units, up 24% year-over-year. Net revenues reached EUR 2.2 billion on higher volumes and favorable mix as well as the strong positive pricing. Now turning to Page 7. In South America, our 8.9% sales growth outpaced the 8.2% growth for the industry, leading to a 23.5% market share, up 20 basis points from the prior year. Our total sales stood at 201,000 units, supported by strong commercial performance from the Fiat brand. Consolidated shipments increased by 10% to 191,000 units, with the all new fast back adding 10,000 units and higher volumes from the Fiat Argo Citroen C3 and Peugeot 208. Net revenues increased by 20% to EUR 3.5 billion due to volume and mix improvements, vehicle net price up 3% and FX translation effects. Taking on China and India and Asia Pacific, our consolidated shipments increased 4% with a good start for the Citroen C3, the first of our vehicles engineered on the smart car platform, which is designed for a more affordable offering and is also launching this year in South America. We also had higher Citroen, Berlingo sales and around 1,500 volumes, offsetting a reduction in shipments for the Jeep Grand Cherokee and Compass. Net revenues for the segment reached the EUR 1 billion mark, up 5%, mainly due to the increase in volumes and improved mix and pricing effects, more than offsetting the negative impact from a weaker Japanese yen. We conclude our segment review with a very strong performance from Maserati, benefiting from shipments of the all-new Grecale and all new GrandTurismo. Shipments for the brand in North America and in large Europe reached [3,800] units and 2,000 units, respectively, more than doubling year-over-year, driving total shipments up 95%. Consequently, net revenues increased 65%. Despite the Grecale being sold at a significant premium against its key competition in the segment, the negative mix impact was due to its lower price range compared to the other models in the brand. On Page 8, we present the status of the aggregate of independent dealer and company-owned inventory, which rose to 1.3 million units at the end of March compared to 1.1 million at the end of last year. After the last 2 years of supply-constrained environment marked by the pandemic, unfulfilled semiconductor orders and production disruptions, our inventory has now returned to a more normal level, consistent with the current sales rate. In last year, we continue to experience outbound logistics challenges, which, of course, an increase in our company-owned inventory. As we resolve these logistics issues in the next few months, we expect this inventory to flow through to dealer inventory and to higher sales. Moving to Page 9 and looking ahead, we are accelerating our electrification journey in North America, adding what we believe will be a powerful second dimension to our already strong European [EV] story. The RAM ProMaster will be launched by the end of this year and considering also imported vehicles, we will count a total of 8 BEVs in the region by the end of 2024. Those will include the Jeep Recon and Wagoneer S as well as our benchmark -- defining RAM 1500 REV, which will offer the best combination of range, payload, towing capacity and charging time in the strategic segment. Turning to our final page. We review our full year outlook and guidance. We have maintained our 2023 industry outlook for all regions as provided in our last call on February 22. We're keeping a relatively stable approach on our full year projections despite high single-digit to low double-digit growth in most regions in the first quarter of the year. We would expect strong year-over-year comparisons to continue in Q2, but we remain prudent regarding the second half of the year given the macro environment. Stellantis will continue to remain focused on maximizing margin performance and cash flow generation to position the company as profitable in all weathers. On the basis of the positive Q1 performance that we have just reviewed, we confirm our guidance for full year 2023, expecting double-digit adjusted operating income margin and positive industrial free cash flows. Last of all, let me address the recent announcement that I'll be leaving the company at the end of June and the Natalie Knight, the current CFO of our whole delays is joining the company as our next CFO. While this is a dynamic industry and is always much, much more to do, at the same time, I think, for the company and myself, we're in as good a time as I need to execute a transition. In terms of the financial health of the company, last year, Stellantis delivered one of the highest adjusted automotive operating incomes in the industry with top 3 rankings in both revenue scale and margin percentage. The merger integration has progressed well and delivered to the point where we have a high level of confidence in our ability to maximize the combination's potential with the necessary capital to execute it secured. As someone would say, it's all about execution, and I wish Carlos and my colleague at Stellantis, all the best for the future. I'd also like to say that it's been a privilege for me to have held this position and to have the opportunity to discuss our unique company and the direction of the industry with you, the analysts on this call, our investors and the broader investment community. From my side, the interactions have always been frank and constructive and I have learned a lot from them. Many thanks to you all. I'll be here for another couple of months, and we will have opportunities to touch base. So now let's talk about our performance in Q1 and what is most important to the results of Stellantis moving forward. Operator, we're now ready to take questions.

[Operator Instructions] today's first question is coming from Mr. George Galliers calling from Goldman Sachs.

And look, Richard, I would like to start by saying a big thank you to you. I believe I speak on behalf of the entire investment community when I say that you will be hugely missed once you leave Stellantis. Over the last 2 decades, you've overseen several cycles, a global financial crisis, spin-offs, M&A. And I think most importantly, more recently unprecedented industry margins in both North America and Europe for mainstream volume automaker. Throughout the years, I believe there has been a very high level of mutual respect between the financial markets and yourself and your factual transparent and patient approach as well as your willingness to always engage in discussion and debate have been hugely appreciated by the market. So a big thank you, and we wish you the very best -- turning to questions. Maybe we could just start with inventory. Obviously, this is a big focus for investors at this point. Can you just give us an indication of where your inventory in North America and Europe sits today relative to what you view as a desirable level and also relative to pre-2020 levels. And then the second question was with regards to North American margins. Obviously, compared to the first half of last year, we are expecting higher industrial costs, but at the same time, price mix in Q1 was a large positive driver. And you mentioned you expect strong year-over-year evolution in Q2. So with this in mind, will the strong price mix effectively net against the industrial cost creating scope for similar North America margins in 1H to last year? Or on balance, do you expect the cost to outweigh the price mix?

Thank you, George. Thank you for the kind words. I appreciate it. Talking about the quarter and your questions on inventory, I think for North America, we have about 69 days of inventory, which I think is fine in terms of absolute level. Our market share has been slowly improving from the low levels we hit in Q4 of last year for various reasons. So I think that's very positive. And also, clearly, we have a pretty strong overall market as well. But I think in terms of the absolute level, it's okay. And comparable to, I suppose, pre-2020 levels, although we were actually higher than that for a period of time. So I don't think it's high compared to -- well, actually it's still low actually compared to pre-2020 levels. So I think it's very healthy. There are some issues in terms of the mix still. We had some competitive issues on the lower price range areas of Grand Cherokee and light-duty Ram. I think those are now being addressed so that we can offer a more balanced product range to the customers in the dealerships. And secondly, we also had a couple of stop sales on the heavy-duty truck in the last 3 months or so, which clearly hurt us from a sales performance point of view. I think those are now behind us. So we should see some improvement in our short-term share performance. So I think North America is okay. And we're going into the seasonally high spring selling season. We saw April was a pretty strong [SARs], and so I think it's fine -- on the European side, the -- the real issue continues to be outbound logistics and our ability to fulfill order backlog. We have still a pretty strong portfolio of orders. And our challenge continues to be fulfilling those orders. It's improving. But obviously, the market is moving quite fast as well. So we've moved slower than the market in fulfilling our orders compared to our competition, and I think that's hurting our share. And so you saw our production is improving. And so the company inventory was up, and that's mainly in Europe. And so we need to continue to improve our outbound logistics performance to transfer company inventory into dealer inventory and then into sales and market share. So that's still top of our list of things to resolve. It is improving, as I said, that is still creating some delays in our sales process. So I think that's where we are on stock. In absolute terms, I think we're fine with those 2 caveats that I just explained. And then margin in North America, I think the progress on the top line shows you that pricing is relatively stable, coming off at the end of last year. And so for North America, I think that's very important that we maintain our price positions. Our products and our brands in our view, are extremely competitive and warrant the price position that we've earned over the last 2 years or so and actually longer. So I think that's fine. I think at the moment, like I say, our sales performance is also trending up month-over-month. And so the big challenge clearly is to continue to reduce our cost positions from also the high levels they finished up at the end of last year. We're making progress on our product costs and our transformation cost. The production environment is more stable, and that's helping us to be more efficient. And so as we go through H1, as we've talked about also with the CEO, the first priority is to be disciplined on pricing and at the same time, work on our cost position on the product and bringing that down. So the mix was a bit negative in Q1 on North America, we had more fleet and more Jeep Compass as Jeep Compass is improving, performance is giving us a bit more volume, but it's from a revenue per unit point of view, it's negative on mix. But I think that's also a positive top line impact. So I think we can see a way through H1 of maintaining a good balance between holding price and working on our cost equation. And then the discipline is there, but we'll see how our commercial performance continued in Q2. But so far, I think so good.

We'll now move to Thomas Besson calling from Kepler Cheuvreux.

Apologies. It's Thomas. Richard, I would first like to extend George message, and thank you as well. I think it has been a privilege more for us to work with you and for you to work with us. You've always been very transparent and brought your own clear view on question and static. It's been very useful for all of us. If I move to my questions, I'll have 3, please. Firstly, I'd like you to come back on the third engine dynamic. I mean, the evolution of [ASP] and probably [RAM] is the best in the group, it seems. Can you remind us the key drivers of that and maybe the relative share of electrification in that engine versus Europe and NAFTA Second, you mentioned the fact that your order bank is still super high. Could you give us any number on the evolution of that global order intake or European order intake and its evolution in Q1? And lastly, if we come back to inventory, is it fair to say that the fact that you have higher group inventories suggest more that you still have a few ongoing issues that you are saying about outgoing logistics more than any erratic development on that field.

Thank you, Thomas. So on the third engine, I think there's obviously a lot going on there because it's an aggregation of 4 regions of our business. But I mean, on South America, I think it's very -- obviously, FCA had a very strong position in Brazil historically and with the Fiat brand and more lately also with the Jeep brand. And I think PSA had a stronger position in Argentina actually and then in different segments of the market as well in terms of the product portfolio. So putting the 2 together, I think we've sort of rounded out a complete product portfolio for the business. We've got 2 major markets, not one. And we've also got a lot more opportunity in the rest of South America with a more complete product portfolio. We have a very strong team, very strong brand equity -- in South America. And so I think we've seen improving share, improving margins, improving customer satisfaction and product quality. So everything has been going in the right direction in South America. And I think we will continue to have good momentum because we have strong positions in parts of the market, which are very relevant to that geography with the Jeep SUVs, the pickup trucks on various brands and now also bringing in the Ram brand at the top end on the pickup. So I think it's a very strong mix of factors that continue to show us opportunities there. Middle East Africa, doesn't have the industrial base that South America has -- that's not a big priority for us, we've been talking about getting more dedicated capacity in the Middle East, Africa because we do have very good positions from [xPSA] in some of the North Africa countries from [XF] in Turkey and also from [XP] in Turkey. And I think the team has done a great job in bringing also a lot more focus on to the region and on to the Gulf area as well and bringing to bear some of our product portfolio, again, which is very complete for the region and includes also the U.S. sourced product, which can be very profitable in parts of the market as well. So I think with Turkey positioned, the market positioned, growth opportunities in Algeria and other countries in North Africa and the Gulf states, I think our product portfolio is great. The team is doing a great job, and we're seeing some really good results, and we're making further investments because clearly, Middle East/Africa has a very strong cost base. It's relatively close to some of our other markets, and there's a lot of synergy there that we can take advantage of. And so -- and I think in Asia Pacific and China, in Asia Pacific has also had a lot of positive growth in the last 2 years. We're now making more investments on the industrial side outside of India. India, we have a good position. We just launched some specific smart-up platform, which is going to be an important platform, both for the Third Engine countries. And also, I think, medium term also for European competitiveness on the low end of the price range. So also good potential. I think the Third Engine really is where Stellantis can continue to drive growth. As we talked about, we don't want to set our laurels and just look at price and margin maximization in the mature markets, but we want to grow globally. So I think this is a really good story, which is going to continue. In terms of the order bank, I'm not going to give you a precised number, but I think we have a strong order bank going through -- beyond the end of Q2 for Europe. We have seen some sort of -- some relative slowdown in order intake a little bit. But we still have a very solid order bank. And more than absolute order intake, we've also seen a bit of a change in the mix, where we've had B2C mix slowing down a bit more. B2B still relatively strong. So we're keeping a very close eye on the trend in terms of the order intake. But at the moment, the real focus and issue for us continues to be fulfilling the portfolio orders that we had, as I mentioned earlier. And I think there is, to some extent, the growth in the European market is also a function of a number of the OEMs having a strong portfolio of orders. Those orders are now being fulfilled quicker because production is improving. And unfortunately, with our outbound transportation challenges, maybe we're fulfilling them slower than others. So that's hurting a little bit on our share performance. But I think the attractiveness of the relative portfolio is still very strong, and we're seeing a good level of order intake. And the portfolio is good. So it's really -- for the full year, the big item is to see how, I think, sales perform into the second quarter and through September because I think the order book gets us through sort of Q2 time frame. Outbound transportation is also creating a bit of a cost headwind because there is inflation there, because we're not the only ones suffering on logistics. And so pricing has also shown a lot of inflation on the pricing. It's starting to mitigate a little bit, but it's not just a Stellantis challenge, I think it's an industry challenge.

Our next question is coming from Mr. Philippe Houchois, calling from Jefferies.

Richard, all the best in your next project. My question is on -- we had forward results yesterday, and they posted some very -- well, strong improvement in their commercial business across the U.S., talking about very strong pricing and also kind of the catch-up equipment phase for some of the contractors who couldn't get trucks for a while. Are you seeing the same situation? And are you still kind of in a situation where your commercial customers are above group average margins at this stage?

Yes. Thanks, Philippe. Yes, I think our commercial vehicle business is extremely strong. And we're in a relatively similar position to fold and fighting it out with them for the global leadership of LCV. Obviously, the strengths that we have, and they are slightly different. They have a very big positioning pickup in North America. We are the smaller. And obviously, we've been improving that over the last decade. So getting closer to them. And I think our new products will continue to help us to be very competitive in that area. And obviously, in Europe and in South America, we have very strong positions on LCV leadership position. So our profitability on LCV as a whole is above average compared to our portfolio. That's for sure, including obviously pickups and vans in that. So I think it's an area where we need to continue to focus a lot of effort, both in terms of execution, dedicated resource internally and also capital. So I think you'll see great things from our LCV business going forward. And potentially over time, we need to continue to give you more visibility of it because I think sometimes people forget how important that is to Stellantis performance.

Our next question is coming from Stephen Reitman calling from Societe Generale.

Looking at the U.S., again, you've said in the past that the U.S. dealers haven't been asking for more incentives, they've actually been asking more vehicles. Where would you say we are now on that access as we look in the second quarter -- into the second quarter? And could you update us on the progress you're doing in terms of the in-house Finco development versus you're working with Santander?

Thanks, Stephen. So on U.S. dealers, I don't want to exaggerate. I mean, obviously, I think most business people, if you could give them an incentive, they would ask for it. So that's part of the normal discussion with any partner in a transaction. But I think it's still true that our biggest challenge at the moment is to get the right complete mix of products into our dealerships. So -- we've talked about it in the last couple of calls that Grand Cherokee and light-duty truck needed to be rounded out at the lower end of the mix, and that's in progress. I think we've made a lot of progress. You've seen our market share edging up in the last few months. We've also had other product challenges like the heavy-duty truck. So I think the main focus for us is to have the best product in the marketplace at the right place, in the right mix, and that's getting there. And as I said earlier on, in terms of the pricing positions, I think, overall, and there are always some debates on individual vehicles and individual parts of the market. But I think, overall, we think our price positions are appropriate for the quality and the offering that we make under our main brands, and we've seen some of our brands further improving their performance, notwithstanding that we've made some price improvements because of the equity of the brand and the quality of the product. So -- I don't think so far it's the discipline is abating. We need to maintain discipline on price. And we need to work on the cost of the vehicles because we've had a lot of inefficiencies. We talked about because of semiconductors and other supply chain challenges, and that's a big focus for us. So that if pricing becomes tougher in H2, which is a possibility that we need to be ready for, not that we're expecting that to be happening, it's certainly not going to be as to start focusing on price reduction, but I think we need to make sure that our cost positions are extremely competitive. That's a huge focus. And I think it's something that the Stellantis organization has proven itself to be quite good at. On the Finco, yes, we're building the portfolio as we talked about. So I think this year, we expect to build up to around [ $5 billion ] of portfolio in Finco in North America. And that will be an important start to the next 4 or 5 years of building a portfolio that is at a level which makes sense for the size of our business in the U.S. And we continue to work together with our other financing partners because it is important for us to offer our customers and dealers options, and our captive Finco is still being ramped up. But we have the products. We have the team in place. And now we're starting to financing a lot of our sales, and we'll start to see an improvement in the portfolio through this year. So we'll keep you updated on that progress.

We'll now take questions from Mr. Tom Narayan calling from RBC.

Tom Narayan, RBC. And yes, thanks again, Richard, for everything. Question -- a follow-up probably on Philippe's question from the Ford results last night. The thing that was really called out for North America net pricing was incentives coming up considerably. And one thing that they noted was there would be a sizable downshift in '23 because of the way that incentive accrual happens, like between wholesales and retails. So basically, because incentives are going up, by the time it's a retail sale in, let's say, 2024, it gets accrued beforehand. So there's this kind of downshift that happens on net pricing. Just curious if that's something that could happen for you guys as well? And then the other question, they talked a lot about Ford Pro and how it has this 30% attach rate, like software services and the aftermarket. Just curious if you could share some similar metrics that you guys have for your U.S. professional on the pickup truck side?

Yes. Thanks, Tom. So in terms of the mechanics of incentives, it's just a mechanical process, right? If you have -- if you accrue incentives at shipment, and then you alter the incentive on your vehicles in the market, then the vehicles that are in dealer stock at that time on which you've accrued a certain incentive if you decide you're going to spend more, then you have a stock adjustment, right? That's what -- that's just -- I assume that's what they're talking about. I didn't listen to Ford's call, but I assume that's what they're talking about. So I think that's just a mechanical process. I mean -- like I said, I mean, we expect to be very disciplined on our pricing. And so far, I think you've seen that that's our approach. Our margins are clearly very strong in North America. Last year, they were very strong. And we've got a good position and a great team who are very focused on maintaining the profitability. So I'm not predicting any changes in our pricing positions. Like I said earlier, it's key for us to continue to work on the cost equation of the product and on all of the synergy opportunities that we have to maintain our competitiveness. So that if there is any sort of price erosion in the marketplace, then we're in good shape to manage it and not have a significant impact on our margin performance. In terms of Ford Professional, we obviously compete with them very directly in all our markets. I don't have specifics on the [indiscernible] rates, we can get you those offline. But I think we're very competitive with Ford Pro on all the aspects of the customer offering, both the product and the services. It's clearly something that our LCV team is very used to managing. We are their main competitor in lots of ways and lots of jurisdictions. So I think we're very competitive, but I don't have precise numbers to compare to the 30% you mentioned. So we'll get back to you.