Question-and-Answer Session
Operator
(Operator instructions) The first question comes from Matt Sheerin - Thomas Weisel.
Matt Sheerin - Thomas Weisel
Regarding the guidance, which I know is down more than seasonal. Would we expect then that the industrial and automotive markets which were the weakest in the September quarter also to be very weak or are there any signs of stabilization in those markets?
Martin Slark
Let me take the two markets separately. I think if you look at the automotive market and you look at the macro conditions in the market out there it is hard to imagine leading into Christmas and with the challenges the automotive companies have that really started here in North America but now I think have spread significantly to companies in Europe and you have heard about significant shut downs over the holiday periods there and now seeing some impact in Asia. There is going to be some recovery in that market in the current quarter. When you look at the industrial market I think that is a different picture because we have seen within the industrial markets there are some segments such as heavy duty vehicles, low automotive transportation, some alternative energy markets and things like that which are actually relatively strong. But the weakness interestingly enough we included in our industrial market equipment that we sell in the automotive plants, so the wiring systems that go into the automation equipment in those plants and obviously those sectors remain weak.
So I think the industrial market it depends a little bit on the balance of business. I think we have been more hopeful about some spots of growth opportunity there and the automotive market has got lots of publicity though there is not much hope for growth there in the next few months.
Matt Sheerin - Thomas Weisel
Distribution also, I believe plays a pretty big role in your industrial area, right? I know they have been very careful about inventories so I think that probably plays a part in it too right?
Martin Slark
It does. I think what we have seen is everybody in the current economic climate is very, very careful with their inventory levels and you are absolutely correct, generally speaking about 26% of our revenues totally go through distribution but the industrial sector is upwards of 70%.
Matt Sheerin - Thomas Weisel
My follow-up just regarding your commentary about materials pricing and your costs coming down I know it is going to take a couple of quarters before you actually see that. ASP’s have as you know held up pretty well and in fact in some cases have gone up. Would you expect to see customers come back to you in a quarter or two asking for price concessions because they have seen your costs go down in addition to the competitive environment we are in?
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