Daniel Moore: Thank you. Good morning, John. Good morning, Kelly. Thanks for taking the questions. Maybe start with just a little bit more color on the inventory destocking process. How much discounting should we be thinking about or expect on the remaining ’23s, for the next two quarters? And just talk about your confidence that we won’t necessarily be in the same place six to 12 months from now with the ’23s that we’ve kind of gone through with the ’22s. I appreciate it.
John North: Good morning, Dan, thanks for the question. And I wouldn’t – I’d be remiss if I didn’t acknowledge that we appreciate the recent initiation of coverage and the partnership with CJS, and you and Bob, and whole new team. So thanks for that. As it pertains to inventory I think it’s important to delineate between what we experienced last year, which was really the breaking of the log jam in terms of the backlog of orders and a significant oversupply of 2022s versus what I think is happening this year, which is as we move through the summer and model year ’24s are introduced, you’ll start to see more aggressive discounting at ’23s. But that’s normal. That happens every year. And I think whether you’re talking automotive or whether you’re talking RV, at least in the 10 or 11 months that I’ve been here and Kelly has been here a few months shy of that, so it’s still early for us in terms of our experience.
But that should be normal, right? You’re going to have that model year changeover and you’re going to see discounting move up. And typically, the discounting gets more aggressive as the year progresses, but it becomes a smaller percentage of the mix. I certainly don’t think it’s going to be as acute as last year. I think, according to the pundits that I look at and the industry data that’s released in terms of where we’re going, most people are triangulating around a 300,000 or so wholesale delivery number for this calendar year compared to a 350,000 retail delivery number. And so that would imply 50,000 units of destocking. And so I think, in short, we’ve done a good job of being ahead of getting through the 2022s. Kelly mentioned, it’s less than 5% of our inventory at this point, and we’re down to 100-and-some units, I think.
So that’s pretty much behind us. Now we’re starting to see the ’24s. And we have a few hundred on the ground. It’s not a significant number. But we’re starting to obviously prioritize some of the discounting and partnering with the OEMs around ways to keep that momentum moving. When I look at our bottom line gross profit per deal, I think our expectation is that you’re not going to see it move dramatically from here. It’s going to fluctuate as it would normally. But I don’t anticipate the pressure that we saw in the back half of last year at all. And I do think the ’24s are going to come on and help, I guess, adjust the mix or balance the mix more quickly than what happened last year, which should help to hold grosses more consistent. So I think it’s very different than last year and manageable.
Daniel Moore: Really helpful. I think you stole my next question, which is gross margins despite being a lot of flux have actually held up quite well. And I know you think of it more gross profit per unit. But any additional color on likely direction of gross margin either on a percentage basis or per unit basis as we think about the balance of this calendar year beyond what you just described?
