Tom Haven : Yes, sure Robert, thanks. I think we’ve seen a more normal typical seasonal decline in rental. If you look back last year as we went from the fourth quarter into the first quarter, we actually saw rental utilization hold pretty well. This year, it’s fallen kind of typical to seasonality and the falls in utilization have been really in line with what we’re seeing in the freight market. So, if you look at the utilization in the various types of vehicles, the sleeper classes and the trailer classes, for example, that tied directly to the freight market. Those are the ones where we’ve seen the decline. And as Robert mentioned, our lease – excuse me, our rental fleet has adjusted to more trucks, and we have seen the resiliency in the truck classes as we moved from quarter-to-quarter.
And that’s what we wanted to see and what we were hoping to see, and that’s what we’re seeing as we enter 2023, where the truck classes continue to perform pretty well from a utilization perspective.
Justin Long: Got it. Thank you. Sorry, go ahead Robert.
Robert Sanchez: What we’re assuming it’s mid to high 70% in terms of utilization in our forecast coming down from the 80% plus that we saw last year. So, we’ve built more normalization if you will, of demand.
Justin Long: Great! And it sounds like you’re expecting to be in that mid to high 70% range in the first quarter. Is that correct?
Robert Sanchez: That’s correct.
Justin Long: Got it. Thanks for the time.
Robert Sanchez: Probably more the mid-70%s because it’s the first quarter, so it’s usually the weakest.
Justin Long: Makes sense. Thanks.
Robert Sanchez: Thanks Justin.
Operator: Our next question comes from Jeff Kauffman from Vertical Research Partners. Please go ahead.
Jeff Kauffman : Thanks everybody. Just a follow-up, and thank you for that guidance on the seasonality and the rental utilization. The first quarter is normally down about 6, 6.5 points, right?
John Diez : Generally yes, from the fourth quarter.
Jeff Kauffman : Okay, here is my question, thank you. So just looking down the road longer term, a lot of changes coming in vehicle technology. I know you guys have been very progressive in terms of looking at new vehicle technologies. We have a new CARB regulation coming in California; we have a new EPA regulation in 2027. I realize this is a pass-through, but fleet economics are going to change as we begin these transitions. Can you just update us where you are in terms of some new vehicle technology? And how do you think these new environmental regulations may potentially impact customer demand for rental lease vehicles?
Robert Sanchez: So I guess as a general statement, you know more regulation, more complexity, more uncertainty for customers is typically good for Ryder, because they’ll come to people who understand the industry or understand the vehicles for help. And we’ve seen that over the last, I would say 15, 20 years as there has been a lot more regulation around truck technology. As it relates to the transition to EVs, I think we’re very focused on that. We have a team of folks who are a 100% dedicated to working with the OEMs, working with new technology providers to understand the performance of the technology and what’s ready for prime time, and really working to find ways to introduce the technology when it’s ready to the market.
