Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Joel Tiss – Buckingham Research.
Joel Tiss – Buckingham Research
Just a quick one, it sounds like you’re under producing the retail demand in the near term to clean out the inventories so is it fair for us to think that in 2010 your profitability could snap back a little further than what you’re expecting the industry unit volume to improve?
Mark C. Pigott
Great question; Joel you’ve been covering us for a long time and we produce to what our customers demand. We’ve indicated that we’re thinking there might be a slight improvement in the North American market because we’re three years in to this recession now and certainly the age of the fleet is getting older so we’re looking to have some improvement in North America. Europe on the other hand continues to lag North America just because they went in to the recession later. As you picked up quite pointedly, the dealers are in good shape so they need to start ordering stock units at the appropriate times so that could be a benefit so that is how it will all play out.
Operator
Your next question comes from JB Groh – D.A. Davidson & Co.
JB Groh – D.A. Davidson & Co.
You’ve been pretty proactive in terms of cutting costs and that sort of thing, if this continues as it looks like it will, what do you see in terms of other things that you can do and how would you characterize sort of in a baseball analogy where you are in terms of the ability to cut costs?
Mark C. Pigott
Are you talking about the homerun derby or all star game?
JB Groh – D.A. Davidson & Co.
I’m just talking about which inning do you think you’re in, in terms of the menu of things that you could do, how much more do you think there is out there that you could do?
Mark C. Pigott
I think PACCAR is always proactive on reducing costs. We continue to review and have reviewed ongoing, I mean we do it every day, every year. I think if you’re alluding to the healthcare plan revision, that doesn’t happen very often so I think it’s just day-to-day. We’ve got great employees, we’re always looking to be more efficient but I don’t think there’s any big home run cost reductions if that’s what you’re driving at. I think it’s just steady day-to-day review of all of our operations on how we can continue to do it a little better.
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