Dave Graziosi: Rob, it’s Dave. So a few things. Just a little context. The off-highway business by definition is probably one of our more volatile end markets and history has certainly proven that. As we entered this year, our expectation was certainly more of a stable setting in terms of players, especially within the North America energy market. I think as you know, there’s been a number of transactions that have been announced. That was certainly not part of our plan coming into the year. That has naturally led to a reconsideration of those impacted players. And I would say the broader industry around fleet sizing, capital deployment, as well as replenishment. So we’re seeing some of that, frankly, placed away. The market, North America, I think, as you well know, is largely an energy market for us.
So the other thing that continues is the high level of capital discipline within that particular end market and the increased cost of cap has certainly proven that out as the players continue to focus on cash flow and return on their operations, and frankly, margins. So we would expect that situation to play out near to medium term. Our sense is the fleets are pretty well equipped at this point. They’ve done a number of refurb projects. Some of that has then led into some new unit sales. But our sense is that there is an adequate amount of equipment when you look at supply demand balance, and I think service companies will naturally try to maintain that balance. Outside North America, that portfolio is more evenly split between energy and mining construction hauling, if you will.
So that portfolio continues to evolve well in our prepared remarks, referring to the wide-body mining dump I would say, to my comment in terms of one of our more volatile end markets. Some of that activity is really tied to tenders that are being executed by the vehicle OEMs. So to the extent that they are occurring on time or the buyers are actually executing the tenders that really drives the — obviously, the volume through our side. Our experience at least entering the fourth quarter and a portion of the third quarter was some of those tenders getting pushed a bit. So we’ll be revisiting all of that, as you would expect, as part of our 2024 guidance in the first quarter, but it’s something we’re obviously staying close to from a volume and timing and expectation.
Robert Wertheimer: Perfect. And if I can just ask one that matters more, I guess. Vocational and medium-duty outlook or customer orders or your impression of the current state of the market there. I don’t suppose it’s experiencing the kind of weakness you might see in the — on how freight at the haul side, but just to make sure that that still looks on track. I’ll stop.
Dave Graziosi: We wouldn’t disagree with your assessment there. I think it’s — we’re fortunate with our portfolio, as you all know, being weighted in medium-duty as well as vocational and municipal as well, but those markets continue to hold up well. Again, the public comments by the OEMs, the — references back to some continued gaps in what fleets are looking for from a replacement perspective. And I think the industry is still trying to catch up a bit. The average age of vehicles continues to increase. So we’re following that trend, but we — as you mentioned, continue to see a pretty firm market for medium duty as well as Class 8 vocational. And I think as, again, public comments by the OEMs are consistent in that view.
Robert Wertheimer: Thank you.
Operator: Thank you. Our next question comes from the line of Tim Thein with Citigroup. Please proceed with your question.
