Unidentified Analyst: Hello.
Nick Stanage: Sheila, if you look, obviously, we have more content on wide-bodies and what we are seeing with respect to the A350, the Airbus A330 and the 787 coming back that provides a nice boost to 2023. Similarly with Boeing rebounding and stabilizing their supply chain, MAX is expected to grow and the 320 is just limited by the supply chain. So we are not going to give you the percentages per se narrow-bodies versus wide-body, but we are seeing pretty strong growth in both of those platforms.
Unidentified Analyst: Thank you, both.
Operator: Your next question comes from the line of Ron Epstein with Bank of America. Your line is now open.
Ron Epstein: Hey. Good morning, guys. Maybe just a quick one on technology. When you think about looking out over the next couple of years or maybe even towards the end of the decade, with Boeing really not pursuing a new airplane for a while other than what they have got going on at the moment. How are you thinking about investments in technology and where do you think you need to spend maybe some incremental internal funded money on what and just curious on how you are thinking about that?
Nick Stanage: Yeah. Ron, so remember the development cycle for commercial aircraft is quite long seven years, eight years. So material development obviously takes place well in advance. So I don’t know that we are spending incremental. We are spending the appropriate level for what we see as opportunities for next-generation materials, both from a mechanical standpoint, as well as processing capability and the ability to lay the materials down and form the parts faster. So again, and is that unique, solely to a potential new Boeing aircraft or new a Airbus aircraft, the penetration we are seeing in business jets, penetration and opportunities we are seeing in Space and Defense all require next-generation materials. And again, we are pretty much agnostic.
Our assets run all of our products, our development on our fiber is applicable across all of our markets, so a continued focus on R&D and investment, getting our center done in Salt Lake City and getting it staffed appropriately is certainly front and center and a key driver for our future.
Ron Epstein: Great. Thank you.
Operator: Your next question comes from the line of Myles Walton with Wolfe Research. Your line is now open.
Myles Walton: Thanks. Good morning.
Nick Stanage: Good morning.
Patrick Winterlich: Good morning, Myles.
Myles Walton: Patrick, I think you gave end market composition for 2023, which you can back into growth rates. And so correct me if I got them wrong, but it did look like the Commercial end markets are growing about 13 and Defense up about 11, are those right, and I guess, Commercial seems a little bit lower and Defense alone, it seems with a stronger than they were otherwise expect anything to call out there?
Patrick Winterlich: Yeah. No. Your math is pretty good. I mean Commercial Aero, perhaps, the run rate is slowing a little bit certainly Airbus from what we saw in 2022, but it’s still good solid growth and it’s the majority of the growth, is still the largest portion again. Space and Defense, we are just seeing a lot of general strength very broadly CH-53K, F-35 is still continuing to creep up. We have got some European military spend going up and then we are across such a broad base and given the military budgets, there’s just a lot of pull at the moment. I guess I should also mention business jets and Commercial Aero remains robust, but again, what you probably expect a lower growth rate.
Myles Walton: Okay. And maybe one on the CapEx side and starting this year is that primarily for growth beyond 2025 versus what you — when you started the program obviously, the A350 was at 10 and you were thinking about beyond 10, 777 was at 52 gone 57 you think about beyond that. Is the focus of the Decatur expansion eyes on those kind of rates or is it more of an efficiency formula that you don’t need those kind of growth beyond your
Patrick Winterlich: It’s a combination, Myles. So we obviously see the wide-bodies continuing to creep up, but the military as we have just talked about is going to put increasing demand for our products to the business jets, something like the Dassault Bolton 10x with a composite wing, that’s pulling. So it really is sort of we see some growth in the wide-bodies, plus some new programs and extra pull come 2025, 2026 in general program growth.
Myles Walton: All right. Thanks.
Operator: Your next question comes from the line of Robert Spingarn with Melius Research. Your line is now open.
Robert Spingarn: Good morning.
Nick Stanage: Good morning.
Robert Spingarn: Nick, I want to follow-on with what you ended your monologue with a little bit and touch maybe on what Rob was talking about, just because this is such a secular story and I wanted to ask you about your opportunity on narrow bodies specifically. And why — what are the technical hurdles and can you get to narrow-body at some point, like you are on wide-body and while I know there is no new aircraft on the near-term horizon, I am thinking of things like A320neo, rewing 220-500 and then I will throw in the GE or the CFM RISE program as well?
Nick Stanage: Yeah. Thanks, Robert. Well, there is no reason whatsoever that narrow-bodies can’t approach a similar penetration or entitlement as wide-bodies. Remember the latest airplanes develop happened to be the wide-bodies, the 787 and A350, and they are the aircraft that are 50% composite in total weight. If you look at the next new narrow-body and the entitlement, our technology and the market technology has just enabled that to perhaps grow even bigger. And you can see signs of that. Look at what Dassault is doing with Falcon 10x. That’s a composite wing. So we are seeing more and more pull for composites. We are seeing the development that we are doing not only on the mechanical performance of our composite fiber products, but the way it is processed, the way our customers are able to make parts, lay it down and tape or fiber placement, the way they are able to cure it, whether it’s in our autoclave or autopilot, and whether it’s a combination of thermoplastics or thermosets.
So we have that total array, that total sweep of products to enable our customers to optimize the next new aircraft.
Robert Spingarn: So, as a follow-on to that, is there any way for us to think about the relative differences in your product offering than your closest peers?
Nick Stanage: Well, I — the first thing I’d say is, we are the largest in the aerospace industry. I would say, we are amongst vertically integrated and diversified. If you look at our portfolio of pan and fibers, woven products, unidirectional and woven prepregs, honeycomb core, engineered core, all the way to structures. If you look at our peers and what they have to offer is a much narrower band. Now, I am sure they are working similar technologies to improve mechanical performance, to improve processing and lay down, but I like where we are. I like the direction we are moving and at the pace we are moving, and I think our customers are going to appreciate and recognize the value proposition we provide them for the long-term.
Robert Spingarn: Thanks, Nick. Appreciate it.
Nick Stanage: Thanks, Robert.
Operator: Your next question comes from the line of Kristine Liwag with Morgan Stanley. Your line is now open.
Kristine Liwag: Hey. Good morning Nick. Good morning, Patrick.
Nick Stanage: Good morning.
