So we are pleased really where we are on the gross margin side and what the team did. The Fit-for-Growth in total at a high level. We – so as you know, we are counting on $80 million of net savings between 2023 and 2026. We have achieved about $10 million last year, as we said in the prior earnings call. And all the projects that we have either implemented or we are implementing are expected to deliver about 75% of the $80 million and we have a good line of sight to the remaining 25%. So this is the latest status on Fit-for-Growth growth.
Luke Junk: Okay thank you for all that detail. For my follow up, maybe a bigger picture question, Phil, and then just be around the market reaction to your booking of the software since your ClimateSense booking with GM? Just curious if it’s changing the threshold to book with other customers given the modularity, if you’ve seen a competitive reaction as well, or do you think there’d be structural barriers to them?
Phil Eyler: Not seeing any competitive reaction, but we’ve certainly seen growing interest from customers around the world. We’re in active discussions with several of those. We’ve also been actively presenting demonstration vehicles with ClimateSense and including the ClimateSense software, which is driving not only interest for the software itself, but also continuing to guide OEMs to add more content to the vehicle as they’re seeing the benefit of not only the software, but also more hardware content in the vehicle. So we’re really optimistic and excited. Obviously, we’re getting really close to launching SOP with General Motors, and so this will become a nice proof point for us as the vehicles hit the market and clearly thrilled to be working with a progressive OEM like GM, who has really bought into this as a solution.
And I think that was capstone last night with our partnership award at the PACE Awards by General Motors for our ClimateSense collaboration. So, more to come, but we’re feeling really excited about how we’ve eased the implementation of ClimateSense going forward.
Luke Junk: Thank you for that. I’ll just leave it there.
Phil Eyler: Thanks, Luke.
Operator: Our next question comes from Glenn Chin with Seaport Research Partners. Please proceed with your question.
Glenn Chin: Great. Thank you. Good morning, folks.
Phil Eyler: Hi, Glenn.
Glenn Chin: Just some questions around the awards. So, congratulations, another record booking quarter. Specifically on the conquest high-end lumbar and massage award for GM’s next generation truck platforms. So you mentioned the full-sized pickups. But does the award also include the SUVs, which I think historically have carried even more content than the pickups?
Phil Eyler: It’s the truck platform so far, but obviously trucks are the flagship for General Motors, so the level of confidence that they have in us for this product line, I think, is clear.
Glenn Chin: Okay very good. And then just some detailed questions about the other awards. So the impressive content you have in the BMW X series, what heated surface content do you have there? And what is hypothetical high end CPV on these vehicles?
Phil Eyler: Well, we don’t give CPV for individual vehicles. That’s a customer confidential information. But in terms of interior heat, it will be multiple surfaces that will be used to warm the body on touch and to enhance radiative heat as well.
Glenn Chin: Okay. And then similar on the prolong, Phil, what content – what content do you have there? Just curious, since it’s an EV.
Phil Eyler: Yes, multiple surfaces. So, for example, the door and armrest, and in some cases areas under the steering wheel, wheel well, kind of areas.
Glenn Chin: Okay, interesting. And then the Ford Bronco, I mean, that’s not a new vehicle. Was this conquest, or is that new content for that vehicle?
Phil Eyler: New content.
Glenn Chin: Okay. And then just lastly, so you’ve had long, impressive win rates, I think, 80% plus for a while, record bookings, this all comes despite at least the perception of increased competition. Are you guys actually gaining share? These conquest winds suggest that you are at least in lumbar, massage anyway, or is the pie just getting bigger?
Phil Eyler: Well, it’s probably both. We don’t totally analyze share on a real-time basis, so that’s something we’ll have to come back to when we run those. But clearly, 80% plus win rate in multiple quarters in a row is a strong testament to our positioning as the largest independent provider of thermal and pneumatic comfort. I really believe that that value of being able to provide these solutions to any OEM and any combination of seat manufacturers within those OEMs is something that’s really an important differentiator for us.
Glenn Chin: Yes, indeed. Okay, thanks very much. That’s it for me. Thanks for all the detail.
Matteo Anversa: Thanks Glenn.
Phil Eyler: Thanks Glenn.
Operator: Our next question comes from Ryan Sigdahl with Craig-Hallum Capital Group. Please proceed with your question.
Ryan Sigdahl: Hey, good morning, Phil and Matteo.
Matteo Anversa: Hi.
Phil Eyler: Hi.
Ryan Sigdahl: Maybe just following up on Glenn’s last question, so you guys are winning at an incredibly impressive rate. 80% this quarter. But what percent of opportunities are you actually bidding on? I guess are you very isolated in or narrowly focused in what you are bidding on driving that rate or are you kind of casting a wide net?
Phil Eyler: It’s a fairly wide net. There are maybe a few out there that we don’t see, but we see the vast majority.
Ryan Sigdahl: Great. One follow-up on the GM truck award is that across EVs and ICE models?
Phil Eyler: That’s ICE.
Ryan Sigdahl: Was EVs also out for bid and just wasn’t put on, or was that not part of the RFP process?
Phil Eyler: They are different bids.
Ryan Sigdahl: Great, that’s it for me. Thanks guys. Good luck.
Matteo Anversa: Thank you.
Phil Eyler: Thank you.
Operator: Our next question comes from Ryan Brinkman with JPMorgan. Please proceed with your question.
