Dave Heinzmann: Yeah. So I think if we look at portfolio pruning and managing that. First of all, it’s a normal part of what we do every year. And it’s an ongoing sort of process I would say, the fortunate thing is, in C&K, we don’t see significant areas of pruning that we’re needing to do there. There has been price optimization that we’ve had to address there and kind of going through the de-stocking phase there. But we don’t see a lot of pruning that’s necessary in the C&K. We talked actively about it, the biggest area of pruning is in commercial vehicle, and a big part of that is Carling. And we talked about this a couple of quarters ago that the first year of ownership of Carling, there was a huge backlog, right? And so we were very focused on supporting customers and working our way through that backlog and cleaning that up, which probably put the pruning a little bit to the back burner while we were going through that.
We started in earnest in that activity last year, and it’s kind of carrying over into this year and those pruning actions there. Again, we’re talking about automotive sensors coming up, but I think it’s important to recognize the pruning we’re doing in automotive sensor is pretty small. It’s not significant. The bigger pruning is really in the commercial vehicle space that is a heavy amount of that is Carling.
Meenal Sethna: And David, what I would add is you’re hearing us talk more about this pruning today. But if I take a couple of steps back, I would say part of our value creation, whether it’s legacy businesses or even with acquisitions is portfolio management overall. So, with every acquisition we make, right? You don’t see everything during diligence. You don’t do these deep dives but as part of the value creation process, we’ll go through, we’ll take a look at the products we’re selling, we’ll take a look at profitabilities in regions, it’s customers and product line. Some, frankly, may not have a good strategic stat with where we’re going with the company, and we’ll do some different things with that. So the only reason you hear us talking a little bit more about it today and in different periods of time is, we feel that it’s going to be material as we go into 2024 to our sales, right?
And the return to growth, and we wanted to make sure that we just we highlight that so that you understand where our Transportation segment grows, when it looks maybe lower than it should be, it will be because of the pruning. It’s not because there’s anything wrong with the underlying portfolio.
David Silver: No. Thank you for that. And I certainly understand pruning is probably an ongoing process all the time. And when you choose to talk about it is more selective. I have a follow-up question, and I apologize, a little sore throat today. On the EV development programs that you’re involved in, so I do recall that you’re working with virtually every major and emerging EV operation globally. And that gives you kind of a little bit of an insight into I guess, development progress. But there’s been a number of headlines as you’re well aware of kind of companies potentially kind of rethinking the trajectory of their spend and maybe the direction of their spend more directly. But from your perspective, maybe comparing today to, let’s say, six months ago, what would you say the attitude or the — has the approach to development either in scale or in direction for your major EV customers.
Has there been a shift that you think is worth calling out and just a fine point. I mean, this would be the EV developments that end up in your electronics segment rather than programs for, I guess, the more traditional vehicles in your Transportation program. Thank you. Transportation Segment. Thank you.
Dave Heinzmann: Sure. So certainly, lots of press these days around EV adoption rates and what’s going on there. What I can tell you is that our win cadence in both electrification and electronification applications in the auto space continue to be quite robust. In fact, our win rates in 2023 versus 2022 were up 17% and the value of the wins that we achieved in those spaces overall. So while perhaps we’ve always taken a little bit more of a prudent view of how quickly EVs would evolve. So we always have modeled a bit lighter slope to the growth than maybe what’s been out in the press or maybe what the broader projections have been. So while it’s certainly slowed down in some spaces, it’s not wildly different than kind of what the expectations have been at the EV adoption rate.
In Asia, EV adoption rates continue to be extremely robust. And the bulk of that, the big swing up at adoption rate really been driven out of Asia, followed by Europe. So we see a little bit of slowing, but I think you can maybe outsized kind of you, particularly here in North America, where adoption rates have been relatively slow. So what I would tell you is the engineering groups we’re working with at the OEMs continue to be very, very focused on electrification and electronification in the vehicles. So the design cycles continue to be robust, our win in those space and the cadence of wins continues to be quite robust. So we’re not overly concerned with maybe a slightly slower slope in adoption rate in EVs.
David Silver: Okay. Great. Thank you very much.
Dave Heinzmann: Thanks for the questions, David
Operator: I will now turn the call over to management for closing remarks.
Dave Heinzmann: Thanks, everyone, for joining today. That concludes our Q&A session. Thank you for joining us in and for your interest in Littelfuse. Have a great day.
Operator: Ladies and gentlemen, that concludes today’s call. Thank you all for joining. You may now disconnect.
