We’ve switched to taking a more standardized approach to sort of say, look, we’re going to build identically what we’re building here in Kingsport in France and in the second U.S. project with Pepsi. So a very standardized approach to leverage all the engineering, procurement, construction approach to sort of build a replica of what we’re doing here in a very efficient manner. So that’s one way we’re going to help to keep the capital cost down. Now to be clear, we’re still spending capital at the site to make sure the infrastructure is in place for what we will do is double the capacity at each of these sites over time after we get the first site, first modules up, if you will. So we’re actually sort of expanding what we think we can deliver between now and 2030, doubling it versus go 50%, but we’re taking a more standardized approach.
And this also allows us to take a lot of insights we have around how to improve the technology on energy efficiency and feedstock robustness into that second phase in this more modular approach. So there’s a variety of benefits. The other thing we have really factored into our capital estimates yet is a slowing macroeconomic environment should create some deflation in the construction industry. We’re already seeing it in the price of steel and pipes and things like that. So materials are going to get cheaper. I don’t think the cost per labor hour is going to go down. But I do think we’re going to have more availability of resources, higher quality resources. So productivity will improve in materials and equipment will probably come off in price.
So that will help also keep control on the CapEx numbers.
Michael Leithead : Great. And then second, just on Fibers and the new contract there. If I remember, most of your tow business was moved to long-term contracts a few years ago. So is this new pricing just reflective of a portion of your current business that we’ll see further resets over the next two years? Or is this a big reset for almost all of your business here today into ’23?
Mark Costa : It’s a big reset for most of our business. So about 2/3 of our business is on contract. A lot of that is multiyear. Some of it is annual. And even with what is not on contract, it’s pretty firm agreements when it comes to volume on an annual basis. So we — just the nature of when all these contracts started to turn over happen to be last year into this year that gave us the opportunity to have these negotiations and increase these prices. That’s why you’re seeing this all happen now as opposed to a year ago when the market was already started getting tight, but we didn’t have the contractual flexibility to make these changes until now.
Operator: Our next question today comes from Vincent Andrews with Barclays — sorry, Vincent Andrews with Morgan Stanley.
Vincent Andrews : Mark, could you talk a little bit more about, I guess, two things. One, I was struck by the consumer durables comment in Advanced Materials where your volume was down 40%. That just seems like an enormous number. So could you just talk a little bit more about how that’s actually impacting Advanced Materials business and what the sort of cadence of improvement is it’s going to be? And then also, could you just sort of detail a little bit your assumptions about the auto business for ’23? I think I read that you’ve got expectations for sequential decline from 4Q to 1Q and some modest growth overall in ’23. But is there anything changing about the customer mix of your products for the in terms of the cars they’re building and the tech that’s in them or anything like that, just given it seems like the automakers are starting to focus on different things in a more recessionary environment.
