Titan International, Inc. Q3 2008 Earnings Call Transcript

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2008-10-30 14:23:13.0

Tags: Truck, Call Transcript, Earnings, Titan International Inc., Seeking Alpha, Truck, Call Transcript, Earnings, Titan International Inc., Seeking Alpha

Question-and-Answer Session

Operator

Thank you. (Operator Instructions) and our first question goes to the line of Alex Blanton with Ingalls & Snyder. Please go ahead.

Alex Blanton - Ingalls & Snyder

Good morning.

Morry Taylor

Good morning.

Alex Blanton - Ingalls & Snyder

I enjoyed your comments, Morry, and regarding the possible delays of some projects, and I would mention that we've already seen one. In the oil sands, SunCorp announced last week it would delay an expansion project for one year up in the tar sands. You said that this really wouldn't affect you because there would be more production from existing mines as a result. But what about the oil price decline? At what point would the oil price decline, which could go further, inhibit the production in general of all the facilities up there and cause people to push out orders for some of these trucks? What do you think?

Morry Taylor

Well, I believe that you're going to have to see oil, number one, go down to probably in the $30 range before they get it -- you'd see a real slow down up there.

Their biggest problem right now, as you should know if you're watching everything, is just getting the bodies up there, getting people. I mean, they're so short now. And I think what's happened, truthfully, is that they'll probably start getting a little more efficient if they stop some of this building that they're doing up there. And so everybody should also understand when you go up there to, I call it the swamp, you end up the first thing they have to do build these big huge structures to be able to put in when they start opening the -- trying to expand the output that they can throw into those pipelines to shove that stuff down to Edmonton or down to Calgary. And they have these big, I don't know what the hell you call them. But they're these great big facilities where you truck in the oil sand to get it processed to put in these pipes to push. You just don't have -- that's where they're getting themselves -- they're not going to -- they've got to go get more, build more of these things, whereas, what they've got right now can't take the added increase that they want to do.

So I don't care if they don't do that. Then they go around and they're still going to have to keep those trucks going for what they've already built. And then you scoop this stuff out in the depth of it, you have another mine. They have more and more and more property. But instead of opening up a [gazillion] of them, they just kind of like keep running where they're at. And that's how I see it.

 

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