Arun Viswanathan: I guess my question is about some framework you’ve provided in the past. If we go back maybe a year, 1.5 years ago, you were discussing maybe $9 of earnings for 2023. Do you see that as still maybe a possibility a couple of years out that would imply another $400 million, $500 million of EBIT on top of where you are, so what’s the framework to get back there? Is it kind of that high teens EBIT margin and maybe the recovery of the volume? Or would you need more than that to get back? And is that still maybe again available in a couple of years’ time?
Tim Knavish: Yes. Arun, I’ve said before, I believe that the $9 EPS is when, not if, and I stand behind that. And that’s because the fundamentals are there. We have portfolio that has earnings power that has yet to be released. And I won’t give you my entire 10-point plan that will get us there, but you’ve still got recovery in some of our better businesses, aerospace, auto, refinish. Let me talk about auto for a second without going too far off topic here. But if you take a six-year run rate of global builds before COVID, compared to the — I’m sorry, 2021, ’22, there’s 40 million fewer cars that were built during that three-year period compared to the six year before. So, everybody has their guess as to how much of that 40 million will be made up over time, but it’s not zero.
And so that business has a lot of volume recovery to go. We’ve got the price/cost momentum. You’ve heard about our restructuring, acquisition synergies, some of the technology innovation, productivity, sustainable products that will drive share growth. And then just broader volume recovery, we feel confident that the $9 is a when not yet.
Vince Morales: And just Peru, just a couple of comments it’s actually a little more near term. So if you look at 2022, we have to remind — Tim mentioned this earlier, but it’s a good reminder. We really saw Europe fall really the back half of March. So, we’re going to come up against some recession type volumes here in a couple of weeks. We remind everybody that, in Q2, China was shut down, industrial-wise, for almost two months. So again, we don’t think 2022 was representative in China of a traditional — even a compressed run rate on GDP growth. So, those two outside of aerospace, outside of refinish, we think have some opportunities to contribute. And again, as Tim mentioned earlier, we expect very good leverage above historical average leverage as volumes return in any business.
Operator: Our next question comes from Laurence Alexander with Jefferies. Please go ahead, Laurence.
Dan Razon: It’s Dan Razon on for Lawrence. Just in terms of the backlog you mentioned, I think you said commercial backlog was 13 to 14 weeks. And then I think in the comments, you said a $200 million backlog in aerospace. I was just for comparison purposes. How — what does that mean like versus what, I guess, historically it’s been?
Tim Knavish: Yes. Dan, historically, that 12- to 13-week or U.S. PRO paint is actually still high. So that will offset some of the negative volume in some of the other segments. I can tell you that in my short 35.5 years of with PPG, I don’t remember the aerospace backlogs ever being this strong. And that will take us — that’s pent-up demand for the foreseeable future. Refinish, our refinish backlogs are still, particularly here in the U.S., probably 5x what they were pre-COVID. And it’s not only a matter of us getting product out or getting raw materials in, our refinish customers’ backlogs are high. I hope you haven’t had any minor fender benders lazy, but if you have and you’ve taken a car to a body shop, they’re likely to tell you it’s six to eight weeks before you’re going to get that car serviced and taken care of. So the backlogs across all of those spaces are high, and in some cases, historically high.
