There’s still supply constraint issues that are out there and you still have a lot of OEMs converting R&D and working on a lot of launches of EV vehicles over the next 12 to 18 months. So I think it’s a combination of a lot of things. Certainly, the economy could shift and change where demand drops dramatically. We’re just not seeing that at this point.
Bret Jordan: And then one quick question on leasing something that obviously has not been a hot topic in the last couple years, but as affordability from an outright purchase standpoint gets to be more challenging. Do you think there’s likelihood the OEs sort of step in and facilitate more leasing to drive volumes, or is that just not a topic lately?
David Hult: Yes, selfishly, I certainly hope so. That leasing business is important to us because we retain the customers in the brand. And it’s important to the OEMs, because they retained them within their brand as well. There hasn’t been that incentive in leasing, because the product hasn’t been out there and it hasn’t been available and it’s been a way for the manufacturer to retain the earnings, which was great. We think over time leasing has to get feathered back into it. When is it happened by what brand, it’s really going to depend upon availability. But naturally, your luxury segment would be the first to benefit from leasing returning.
Operator: Our final question is from the line of David Whiston with Morningstar.
David Whiston: Going back to — David, you had talked about wanting to get the most out of every vehicle. But just looking at the new vehicle category, the three new vehicle categories, looking at imports, it looked like more of the opposite happened there in that only import had unit growth, but GPU, percentage wise, fell the most. And just given the tight Toyota, Honda inventory, I was a little surprised by that you’re not going as high in pricing there, because you want to preserve some import volume?
David Hult: I wouldn’t say it plays out that way. You have a lot of brands within the segment. The brands with the single day supply had extremely high margins, so we don’t think that was a major issue. I get your point as far as the gross profit falling off. But we still think for import that’s $3,800 or in that vicinity is a very strong number on imports. So again, it’s going to be a competitive market. I don’t see Toyota and Honda having a high day supply this year, so that will equate to higher margins. But there maybe some other brands within that import segment that have a higher day supply. But again, as you can see, to your point with the falling margin like that, we’re still generating over 8% operating margin and we still have a very efficient and healthy SG&A percent.
David Whiston: And with Toyota and Honda, their inventory has been an issue for a long time now industry wide. I mean, how much communication are they giving you and is it purely chip shortage, is it chip plus still some COVID absenteeism? I mean, what do you think driving it mostly?
David Hult: Look, it’s frustrating to us, it’s frustrating to our consumers, it’s quite honestly frustrating for them. We’re fortunate to represent these brands. They communicate really well with us as best they can. And it’s typically in 30 day increment as to what we’ll see and then there’s conversation and talk about what potentially we could see in the first half of the year. Sometimes they hit those , sometimes they don’t, unique things come up with supply chain issues. A lot of these parts come from all over the world and depending upon what’s going on, it could have a negative impact at a moment in time.
