Question-and-Answer Session
Operator
(Operator Instructions) Your first question is from Jeff Leahy - Morgan Joseph.
Jeff Leahy – Morgan Joseph
You mentioned on the Boomerang side that the smaller cars and hybrids were negatively impacting the business but it sounds contradictory to what your comments on the U.S. Is it a market differential and are you seeing good sales in the smaller and hybrid U.S. markets?
Ronald Waters
I think it is a market differential. We still see a positive in the U.S. and it seemed to change rather significantly in Canada particularly in the first quarter and I think it continued in the second quarter.
Richard Riley
It's really a market difference and so in Canada, with the business primarily in Montreal and as a result of insurance mandates most of which run to the luxury cars. And so their install basis has historically been in the high end luxury cars, those that are $40,000 or more.
In the United States the business skews very differently and so a significant part of our install base is on Toyota Camry's and Honda Accords in the United States.
Jeff Leahy – Morgan Joseph
So it would be fair to say that you would see the shift that we're seeing in U.S. new car sales as a neutral if not positive impact for you.
Richard Riley
I would say yes. I think that's part of the sequential performance improvement on a relative basis that saw in the domestic marketplace.
Jeff Leahy – Morgan Joseph
With the Italy, Boomerang and China investments, can you give us a feel for where you stand and how much you've spent and how much you expect to spend going forward with those categories?
Ronald Waters
On Italy, I think we've said this year $3 million to $4 million, I think is our investment. In China it's rather nominal this year, and in Boom it's in the $3 million range for the current year.
Jeff Leahy – Morgan Joseph
Will that be the end of it? Will it go into '09?
Ronald Waters
As I've said, I think in Italy it'll probably take us longer to get to breakeven so there'll be an investment required in '09. China, we're in the throws of finding a new licensee so it will be somewhat dependent upon the relationship with the new licensee. We'll probably be an investor with the new licensee. In Boom we're thinking through next year. We'll update you at probably the year end call, but clearly there will be some investment required next year.
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