But again, we see a world with the de-stocking being relatively behind us, if not behind us by the end of the year, like we already talked about, creating a nice world of stability for us. And so it’s good to be on flat ground instead of feeling like we’re going uphill. So yeah, I think the position we’re in has stabilized nicely as we get near the end of the year.
Steve Ferazani: Great. Thanks, Paul. Thanks, David.
Paul Reitz: Thank you.
Operator: Thank you. Our next question comes from Kirk Ludtke with Imperial Capital.
Kirk Ludtke: Hello, Paul, David.
Paul Reitz: Good morning.
David Martin: Good morning.
Kirk Ludtke: Thank you for the call. And congratulations on another good quarter. Just a couple of follow-ups. With respect to the gross margin, can you expand maybe on what has changed? And have you reduced capacity, utilization up? Are you pricing things differently? Is there any kind of color as to what you’re doing differently?
Paul Reitz: We’ve done a lot differently, man. We’ve done a lot of things really well. It’s been a journey to get to that question and the point we’re at with our Q3 results. And really, throughout all of 2023, I mean, we’ve done a really good job this year. And so David has mentioned in his comments earlier, it’s not one simple thing, it’s a lot of things. You combine what I keep mentioning in some of my comments as well. I mean, our innovation is tremendous. And with innovation, it’s a win-win for everybody. It increases the profits of the end users, our dealers and our OEMs love being able to sell a product that makes their customers happy. And in return, we can earn better margin on that as well. So the innovation leads to better margins.
It leads to more stable demand, both with the OEMs and also with the aftermarket. Again, a lot of products that we produce, this innovation can go directly to the aftermarket as well. It doesn’t have to go through an OEM. So the changes we made at the company with innovation, David mentioned the pricing dynamics. We’ve gotten really good at understanding pricing, understanding our costs and combining the two of them. And we have, I’ve said it a hundred times and I’ll probably say it a hundred more. I mean, the technical connection we have in the marketplace, it’s not just engineers boots on the ground, it’s people that are involved with pricing and financial analysis. They don’t just look at it as a number on a piece of paper. They understand the equipment it goes on.
They understand the impact that has to the end user. They understand how that flows through our operations and the costs in our plants. And so, we’ve created a tremendous environment around pricing and that’s helped stabilize and improve our margins through these cycles. And along with that, we manage our plants effectively. Taking everything I said, that strong connection to the marketplace, we have forecasts that we know where things are going, and we know what to do within our plants, and we take the appropriate actions. I mean, we’ve got an awesome team of plant operators around the world. And I’ve said it again a hundred times [indiscernible] make it one-on-one right now. I mean, our One Titan team has done an exceptional job over the last four years.
We’ve had very little turnover, if any at all, amongst our key management team. So our knowledge, our experience, our connection to the customer, it’s second to none in our industry, and it’s good to see us be able to handle these cycles and like you’ve seen through 2023, we’ve had a really good year.
Kirk Ludtke: That’s great. That’s very encouraging. Just shifting topics here. It’s very encouraging. Just shifting topics here to the competitive landscape. Are any of your competitors making moves that are noteworthy? Do you sense any trends in market share?
Paul Reitz: You’re always looking out over the landscape of what your competitors are doing. I think the big dynamics, what we’ve been talking about is just the OEM de-stocking. If we keep doing what we’re doing, if we manage our plants effectively, keep introducing innovation, understand the market better than the competition, have that connection to the end users. If we keep doing what we’re doing, we’ll be in a good position with the competition. So, I haven’t seen anything that has been a significant change to really answer your question directly. I feel good about what our moves have been this year, especially in Europe. I feel like our position in Europe has continued to strengthen. But again, the innovation we have in North America has been tremendous and our Brazilians have extremely high market share because they do an exceptional job there.
So in our undercarriage business, strong brand, keep innovating, keep pushing into the marketplace and more distribution, better geographical footprint. Our ITM Brazilian business, we talked about the impact this quarter from some de-stocking, but again, their market share — undercarriage in Brazil is exceptional. That business is phenomenal. So, now, I think we — I look at it — I look at it two ways. One, we got to always be looking at the competition like I started the answer to the question, but two, I got to look at our strengths and we’ve got to make sure we keep getting better on our strengths and I think we’ve been doing that this year.
Kirk Ludtke: Great. Thank you. And so market shares are stable?
Paul Reitz: Yeah, market shares have been stable. Again, you’ve got the de-stocking dynamic. But yes, there hasn’t been much — anything significant and much more to talk about other than really just watching our customers manage through that.
Kirk Ludtke: Got it. Well, I appreciate it. Thank you.
Paul Reitz: You bet.
David Martin: Thanks, Kirk.
Operator: Thank you. This concludes our question-and-answer session. I would like to turn the conference back over to Mr. Reitz for any closing remarks.
Paul Reitz: Well, thank you. I appreciate everybody’s time and interest in our Q3 results today and look forward to talking to you in the New Year’s as we highlight the results from the fourth quarter. Thank you. Have a good day.
Operator: Thank you for attending today’s presentation. The conference call has now concluded.
