Stephen Volkmann: Okay, great. Thank you guys. I’ll pass it on.
Aaron Ravenscroft: Thanks Steve.
Operator: And your final question comes from the line of Tami Zakaria with JPMorgan. Your line is open.
Aaron Ravenscroft: Good morning Tami.
Tami Zakaria: Hi, good morning. How are you? So I also have a follow-up question on tower cranes. That’s been weak for a few quarters now. what KPIs are you watching to give any signs of inflection there? Basically, the reason for my question is, is there any catalyst you’re looking forward to which would drive stabilization in trends in the back half. What needs to happen in that market?
Aaron Ravenscroft: Yes. So I think to get us going again. We need to see interest rates come down a little bit. So that’s probably the first thing that I’ve been tracking. Secondly, you can look at the residential permits in Germany and France. I think that’s – there is good data out there. So we’re tracking that as well. But as always, in the crane business, it is always built off of confidence. So I think until you start to see those metrics move, it can be tough for folks to really get a lot of confidence to start spending CapEx again.
Tami Zakaria: Got it. So a quick follow up. When you look at residential permits and let’s say, Germany, France, how — if it inflects, let us say, tomorrow, does your orders come in at a lag, like orders improve at a lag? Or do you easily see orders improve in the same quarter?
Aaron Ravenscroft: Yes, there is a lag to it. There is always some timing to it definitely and we go back a couple of years when it started to dip down, we didn’t actually go. So there is definitely some lag to it.
Tami Zakaria: Got it. If I can ask one more question. Saudi Arabia, I think recent reports suggested that they scaled back some of the mega projects. Can you comment on what you’re seeing in the Middle East and whether your long-term outlook for the region has changed based on some of these reports.
Aaron Ravenscroft: Yes, our outlook hasn’t changed. I know that they’ve changed the scope relative to the line, but I don’t think that anyone really believe the full scope would happen. And it wasn’t going to happen by 2030, everyone I was there last time they were talking that really would be more like 2040, 2045. So it is a long-term investment. So there is no real surprise for us. That being said, all of the other projects are continuing to move forward that a lot of different global or international events that rely on that. So our outlook still remains very strong relative to the Middle East.
Tami Zakaria: Got it. Thank you. Perfect.
Operator: And we will take our next question from Clifford Ransom with Ransom Research. Your line is open.
Clifford Ransom: Good morning, gentlemen. I hate to say it because you give me a lot of crap about being so old. This is now my 52nd year around lifting companies. We all know this is a cyclical business. You’re doing things to reduce that cyclicality and I commend you for what you’ve done on the balance sheet and particularly new products. But what have you done recently to — I saw enormous changes in France when we were there a month ago. What are you doing in the rest of the company or at the top of the company — it’s notable to promote the Manitowoc Way.
Aaron Ravenscroft: Yes. So I’d say that our real focus these days has been around our aftermarket business and trying to figure out how we can apply our lean tools to an aftermarket business, which has been great. Of course, having distribution, we start to learn more and more about our traditional business and what we can do better to be — a better partner to our internal distributors as well as our existing distributors. So I’d say, that’s our main focus is really just dragging it out off the manufacturing floor and into the service locations and to some of our other administrative offices and of course around environmental and some of the things we can do to reduce our costs relative to our gas usage in our papers.
Clifford Ransom: Have you adapted anything in the culture of the Manitowoc Way to make that transition from the factory floor to what we call corporate land world? Are there any particular success stories or learnings that you’ve made from things that didn’t work well.
Brian Regan: Yes — when I look at the distribution business and the finance organization, they conducted value stream mapping session to really look at what impacts and what time they can take out of their process to provide more value to the business and be more of a partner to the business. and that is really on the compliance side. So they spent a few days together to look at their processes and try to identify ways to take out time of that process and really better utilize the system, the finance and back-office system that they use. So I think, we had some good successes, but more to go with that.
Aaron Ravenscroft: Yes. I think in terms of challenges, anytime you are trying to standardize “fixing cranes”, I mean that’s a tough deal. So I think, there is a lot of different good ideas floating around the company. And in fact, I’m pretty optimistic that AI will give us some tools that will help us become more productive and just more effective at doing that.
Clifford Ransom: Thank you very much.
Aaron Ravenscroft: Thanks Cliff.
Operator: And there are no further questions at this time. So Mr. Warner, I will turn the call back over to you for any additional or closing remarks.
Ion Warner : Okay. Thank you. Before we conclude today’s call, please note that a replay of our first quarter 2024 conference call will be available later this morning by accessing the Investor Relations section of our website at manitowoc.com. Thank you, everyone, for joining us today and for your continued interest in the Manitowoc Company. We look forward to speaking with you again next quarter.
Operator: Ladies and gentlemen this concludes today’s call. We thank you for your participation. You may now disconnect.
