Operator: Your next question comes from the line of Jason Seidl from TD Cowen. Please go ahead.
Jason Seidl: Thank you, operator. Joe and team, good afternoon. Mike, welcome back. It must be pretty exciting coming, hitting the ground running and railroad showing improving service numbers. So, we look forward to seeing what you could do in 2024. My question actually is going to be to Kevin. Kevin, you had some comments. You said you had many, many reasons to be optimistic. So, I noted the two manys there. You sort of touched on domestic plastics improving. I’d like to get some meat on the bone there with those commentaries. And then, you talked a little bit about some industrial development projects with Christina. Can you give us some numbers on what you’re seeing now in terms of total projects and maybe what you had a year ago and maybe pre-pandemic?
Kevin Boone: Yeah. We’re exposed to a lot of cyclical businesses and we’re talking about – everybody is talking about a looming recession. Well, in my opinion, a lot of the businesses we touched have been in recession for the last year and many of them are at cyclical lows. And maybe we went beyond that with the de-stocking that occurred. So, when we talk about some of the plastics and we talk about forest products and some of these other markets, there’s significant de-stocking headwinds that we’ve been dealing with for the past three, four quarters. And so just based on that, obviously, the comparisons get much easier from here as we look into 2024. And hopefully in a world where demand is relatively stable, that would implies, hopefully, some growth beyond just having the economy snap back a bit here.
So that gives me a little bit of optimism. Obviously, if you turn the TV on right now, it can make you a little bit hesitant to be bullish. But the things that we can control, as I mentioned before, that pipeline has never been bigger. I don’t think — I’ve only been here for about six, seven years, but talking to the — my colleagues that have been around a lot longer, the things that we’re doing from an industrial development side, the things we’re doing, working with other Class Is, the things — you have the Western Class Is going after the Mexico business, we can participate in that. We’re really happy to work with them. There’s a lot of things, a lot of momentum just around us all working together to create opportunities for ourselves where I think for decades we’ve been pushing volume quite frankly off the railroad, on the truck.
And now, we’re all going to work collectively to really change that trend. And that’s exciting. Forgot the second part of that question. The industrial projects, we did highlight a number of those. I think we’ll put a fighter. We’ll come back probably at the end of — as we look into next year and kind of put up more numbers around that, but the activity levels are just tremendous. And then we haven’t seen any slowdown. And like I said before, the biggest challenge is to create the inventory of readily available industrial sites that are shovel ready tomorrow, basically. As these companies, as we’re seeing more on-shoring, we’re seeing more industrial development. They want to go quickly and we’ve got to be ready to serve their needs. So that’s the focus of this team is how can create more opportunities throughout our network to react to where they need to go and create a service so they can reach their customers.
But we’ll put some more numbers around that as we develop it, but the team has done a great job and we got a lot of momentum there.
Operator: Your next question comes from the line of Jordan Alliger from Goldman Sachs. Please go ahead.
Jordan Alliger: Yeah, hi. I was wondering if you could maybe give some color or thoughts around the auto sector. Obviously, it’s been an area of a lot of strength, the strikes, work stoppages are going on. How much cushion do you guys have relative to the inventory that’s out there versus how long this drags on before it really starts to impact carloads? Thanks.
Kevin Boone: Yeah, I mean, obviously, we want a quick resolution. The quicker the better. As you’re probably aware of the industry as a whole has been short on car supplies. So, to some degree that’s probably helping us or helping the industry to a certain degree. There’re certainly some impacts to us. We’re seeing strong demand in other areas where we have a diverse portfolio. So we’re able to probably supply more cars to those customers that have been wanting more cars here recently and diverting some of those as we’ve seen some impact. But my boss here knows that industry more than anybody else and I keep on asking him every day what his thoughts are. But we’ll manage through it. I think more of this is deferred revenue. And we think the demand still remains out there. So, as we move into next year, we expect to capture all the demand that exists.
Operator: Your next question comes from the line of David Vernon from Bernstein. Please go ahead.
David Vernon: Hey, good afternoon, guys. So, Kevin, I wanted to ask you about the drivers of that domestic intermodal growth from a channel perspective. The numbers sort of turned around in week 17 and it’s been pretty straightened up to the right. Is this just general stuff you’re getting through traditional IMCs or is it a parcel company that’s doing a little bit more over the rails? Is it a retailer that you’ve got a direct relationship with? Is there any one single driver of what’s looking like a pretty big divergence from industry intermodal performance that we should be thinking about there in domestic intermodal?
Kevin Boone: Well, I think it’s not — there’s not one single driver. It’s the teams working together on the operating side and the sales and marketing side. They’re going after every opportunity there is. And they’re — whether it’s identifying new lanes, other things that are profitable, we’re going after it right now, really being able to lean in. And I have to commend the team for their creativity, their ability to work with the — our partners in operations and really go after things and adapt quickly and react quickly to market demand out there. So, we still have a significant value proposition even with the truck as weak as it is today. And that will only accelerate once the truck firms up a little bit here in the next year. But we’re really, really proud of what they’ve been able to accomplish and we’ve got a lot of momentum around it.
Operator: Your next question comes from the line of Walter Spracklin from RBC Capital Markets. Please go ahead.
