Swamy Kotagiri: So Colin, it normally, we don’t have minimum volume guarantees or volume guarantees, right? These are all discussions, like I said, in figuring out as we look at specific programs. But as non-core in the industry, we have a volume set and we work through that. There is risk and opportunity, but no guarantees. There is some in terms of like Pat talked about, like big capital investment, which a discussion with the customer and more specific to those programs rather than a general rule. And some changes going forward. sorry, some changes going forward as we look at these big programs and having conversations, but those are more exceptions than ever.
Colin Langan: Got it. Thanks for taking my questions.
Operator: Your next question comes from the line of Michael Glen from Raymond James. Please go ahead.
Michael Glen: Hey, good morning. Swamy, first, can you give an update on the Veoneer acquisition, how it’s tracking? How sales are tracking and your outlook for the programs there? Are they coming in as expected the volumes?
Swamy Kotagiri: Yes. Good morning Michael, I think we talked about Veoneer. I think as we go forward, it’s I would say, an integrated business into our own electronics business. So we see that as one, but I understand your question. We talked about the $70 million plus in synergies on a run rate basis by end of 2025. I can confirm that we are on track for it. It could be that. As we look at your question about the sales, we talked about the lower sales this year, but that’s not specific to Veoneer. It is overall with program in-sourcing and some delays and some ramp-up trajectory being different. Going into 2026, we still feel comfortable with the overall projections. There is no material difference to what we’ve been talking about.
So overall, pretty comfortable with how we are looking at it. Like I said, obviously, the sales drop that we see right now for various reasons, we are continuing to monitor and see what we can do in terms of investments and engineering spend and so on and so forth.
Michael Glen: Okay. And just to come back on the – I think you’re referring to – you’re referring to $50 million of reduced engineering [ph]. So is that specific to the megatrend spending amounts that we think about. Is that applied to the $1.2 billion of megatrend spending?
Swamy Kotagiri: That’s correct, Michael. And I would say it’s largely to the megatrend areas, right? Significant, I would say. So yes, it is applied to the $1.2 billion.
Michael Glen: Okay. And then just on the balance of the megatrend spending, are you making an active assessment of that total amount? Should – is there a potential that we think about further downward revisions on the megatrend spending in subsequent quarters?
Swamy Kotagiri: Yes. It will be a little up and down, as you see. To answer your question, clearly, yes, we’re constantly looking at it. We have been able to quantify the $50 million, but we won’t stop there. We’ll continue to look at it. The reason I’m saying it goes up and down a little is, we have to look at the application that’s being done on the programs that we have and continue to have and protect the future. Like Pat said, we are looking at this not for this year and next year. What does it mean for the long term of Magna that we have to keep an eye on for sure. But we are continuing to look at everything that’s in place and how we can optimize it. So that’s going to be a key focus area for us.
Michael Glen: Okay. Thank you.
Operator: And that concludes our Q&A session. I would like to turn the conference back over to Swamy for closing remarks.
Swamy Kotagiri: So thanks, everyone, for listening in today. As I said, we remain highly focused on flawless launches of new business, cost containment across the company and obtaining commercial recoveries all of which should contribute to our roadmap of margin expansion and free cash flow generation. Thanks for listening, and have a great day.
Operator: This concludes today’s conference call. Enjoy the rest of your day. You may now disconnect.
