Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Himanshu Patel – JPMorgan
Himanshu Patel – JPMorgan
Couple of questions, first as we sort of try to model out to 2011 can you talk about commodity cost economics, have they changed with the car makers during this downturn where you would think maybe as fuel and all of the critical commodities start rising next year, should we think about the impact for you being very similar to what we saw in the 2005 through 2008 time period or should something be different this time around.
John Plant
Clearly at the moment we’ve seen some strengthening of commodities and mainly that’s due to the effects of both the weak dollar and also the I’ll say continuing rise in the East, in China and India. It really is difficult to understand how that really plays through at this point in time. I would say if it continues to strengthen then clearly we would see some impacts going into 2010 and 2011.
I would say it may not be quite the same as it was in 2005 and let’s say 2008 and that’s because we’ve possibly put in to our contracts greater protections. So it would be a blend so you have to take some percentage of the effects compared to last time. But it still would be an impact.
Himanshu Patel – JPMorgan
And then just on the fourth quarter revenue guidance for $3.2 billion it looks like its roughly up 3% sequentially but I think CSM’s combined North American European production is up about 12%, is that just a calendarization issue.
Joe Cantie
Yes, there’s a couple of things there. The biggest driver is the calendarization. As you know we run a five-four-four accounting system here so our third quarter cutoff on October 2, what that means is that the fourth quarter compared to the third quarter, there’s something like seven or eight production days that there’ll be less in the fourth quarter versus CSM that does everything on a calendarization.
The second thing I’d point out too is when you’re looking sequentially third to fourth quarter we do have an over a billion dollar annual sales aftermarket business and typically seasonality of aftermarket businesses the fourth quarter tends to be lower then the third quarter sales and that is occurring in our businesses.
You don’t see that when you compare fourth quarter this year to last year because it occurs every year and that doesn’t show up in that comparison.
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