Frank Mitsch: Good morning and congrats on the new role, Jonathan. I wanted to come back to the volume questions. Tim, it sounded from your answer that flattish in Q1, basically, but you would expect as we progress through the year Q2, we’d probably see positive volumes. It sounded like that. I was wondering if you could clarify that. And Vince, when you mentioned Europe stabilizing, which is obviously a positive sign. But if I think about math of Europe deteriorating in the earlier parts of 2023, if it’s stabilizing at these low levels, it might suggest that 2024, the net would be negative in terms of volume. So I was wondering if you could speak to that. And also any sort of comments you have with respect to — I know you indicated that China, you anticipate positive volumes there, particularly with the weak comps. But what you’re expecting in the Americas as well would be fantastic.
TimKnavish: Okay. Hi Frank, I’ll start. It’s Tim. I think your interpretation of my volume comments are spot on. Positive — positive volume for the year, flattish in Q1, and then you should see an up-tick soon thereafter. So I do think that’s spot on. I know you asked Vince to your question. I’m going to give a quick lead in on Europe, despite the very benign 2023 volume environment in Europe, we had a record year of earnings in 2023 in Europe. So yes, it does impact the top line, but our team has really executed well and we had all-time record earnings and also, it’s not all of our businesses in Europe. We have — Arrow is very strong in Europe. Auto had a better-than-expected year in Europe. And frankly, we do expect that to continue.
It’s really mostly around the deco the Deco market, particularly the retail deco market in Europe that saw negative volume. And PMC, PMC had a great European year with — particularly driven by both protective and marine aftermarket. So I’d give that lead into Europe and hand it over to Vince.
Vince Morales: Yes. When we say Europe stabilizing in Europe, Europe stabilizing in volumes for 2024, we’re looking at it quarter-over-quarter, Frank, and I know as you know, we’re a very seasonal business there in our Deco our architectural coatings business. So each quarter, we expect that stabilization respective to the last prior year quarter. So again, on a full year basis, we expect that to be flat, reflecting that year-over-year comp quarter-by-quarter. Again, our view of China is a bit different, I think, than what most markets are seeing. We always have to remind folks, we do not have a large architectural presence in China. One of the heaviest unfavorable items in China is the construction and housing market, very little exposure for us.
Again, we’re turning the corner on industrial. Auto is growing. Our refinish business is returning in China, because of higher miles driven and aerospace is starting to come back. So our mix of businesses in China helps us. And again, the fact that we don’t have that architectural content. The architectural industry draws a lot of raw materials as well. So the fact that, that’s down is supportive of our earnings in China.
TimKnavish: And the last part of your question, what are we seeing in the U.S. relative to volume? We’ve got the PMC business, mostly on the P side, the protective side, doing well in the U.S., driven a lot by energy spending and infrastructure traffic with infrastructure spending will be stronger this year. Refinish doing very well. And auto, the U.S. SAAR is holding up very well. I know inventories have ticked up a bit, but they’re still only at about 40 days. So those would be on the – and of course, Aero, we’re selling everything we can make. So those would be on the positive side of the U.S. ledger. The negative side, again, we’ve said DIY multiple times, we do expect at least the first half of this year, to be soft there.
The only upside there might be that we do believe destocking in that space is behind us. And then finally, I would say general industrial coatings driven by just industrial activity, and this could be all kinds of widgets that get painted. That’s still a bit soft in the U.S. So that’s a bit of a positive and negative ledger here at home, Frank.
Operator: Our next question comes from Aleksey Yefremov with KeyCorp. Your line is open. Please go ahead.
Aleksey Yefremov: Thanks. Good morning, everyone. Can you just provide an update on your strategic efforts to broaden the product lines with Comex, where are you versus your goals? How — what are your plans for 2024? And maybe broader any update on other strategic organic growth initiatives that you talked about last year?
TimKnavish: Yes, sure, Lexi. So in PPG Comex in Mexico, we said in May, 1 of our key initiatives was to continue our robust performance and growth in the Deco space, and the team did that another record year, double-digit sales up on the year, but also to introduce other parts of our portfolio to that strong concessionaire network. And we’ve done that. Protective Coatings were up, let’s call it, very high single-digits. Adding again adding that fourth letter, but traffic sales were up double-digit. And I just returned, we just had all of our concessionaires together this past weekend and I was down there meeting with them, and they’re very bullish on their ability to sell not only Deco, but these protective traffic, powder, light industrial coatings.
So we’re off and running. We just literally on — I believe it was Monday of this week, introduced powder brands and refinish brands that are specific and dedicated and exclusive to the concessionaire network and that got a very good reception. Your other question on the initiatives that we kicked off last year as part of our enterprise growth strategy, I’d say, I am very pleased with the first year of execution of that enterprise growth strategy. As we said in the opening remarks, those initiatives, just in the first year, generated about $150 million of incremental sales. And some of those initiatives are longer-term initiatives than others and still in development. So between powder films, the Mexico opportunity that we just talked about, EVs up 20% content per vehicle.
They’re all up and running and I’m very pleased with the progress that we have seen so far.
