Now, the first two features really come from the BMS side of technology. And the reason we won this business is on account of our capabilities and proven expertise in BMS. So again, we’re very pleased that this is a quick sort of a turnaround from when we first talked about the junction box and the smart junction box to landing this business with a very credible and capable OEM. And this I’m sure will lead to further opportunities in these types of more and more integrated solutions. Now, just to be also clear, this business is on a new platform that the OEM is developing for their luxury vehicles, but it also gives us the potential to then take it into the other platforms, the performance, the value brands that they have within their portfolio.
So it’s a very significant opportunity and an opportunity that is going to have a very long tail, plus brings us into this power electronics business that we had not been present in previously, so very excited about it.
Gautam Narayan: That’s great. Thanks a lot. It sounds like a big win for you guys. Thank you.
Sachin Lawande: Thank you.
Operator: We’ll take our next question from James Picariello with BNP Paribas. Your line is open.
James Picariello: Hi, guys. I just want to hit on the recall charge again. So this is not something that’s going to get recovered by you from related supplier, right? So this is an additional $15 million charge for the year that wasn’t previously contemplated in your guidance. So, I suppose my question is, without that impact, your ability to maintain your guidance here, right – I mean there is a 40 basis point hit to your margins, so you’re in effect raising, right? You’re in effect raising by about 40 basis points your margin trajectory for this year. Is that a fair way to think about this recall charge and the implied improvement in your underlying business from a profitability standpoint?
Jerome Rouquet: Absolutely, James. It’s absolutely the right way to look at it. Without this charge, we would have increased our EBITDA guidance, not our sales guidance, but our EBITDA guidance. And it’s largely because our run rate is slightly better already at the end of H1 going into the second half. So in terms of EBITDA, we are slightly above 10% of EBITDA margin, when you exclude the charge. And we are contemplating being close to 11% in the second half, and that allows us to be at the $425 million of EBITDA for the full year. So you’re absolutely right. We would have raised guidance on the EBITDA side if we hadn’t had the charge.
James Picariello: Understood. And then, can we just revisit the semi supply situation that might have some persisting problems that need to be addressed? I just want to make sure I fully understand what’s happening on the semi sourcing, the chipset comment that was made.
Sachin Lawande: Sure. So in general, I would characterize semi supplies as continuously improving and the number of parts that are in critical short supply situation is reducing with every quarter. But we should not necessarily think that that issue is going to get to a point yet this year where we will have no shortages, so we need to be clear about that. So our redesign activity that we have talked about on previous earnings calls is really helping us bridge the gap between supply and the customer demand. So, in this quarter, in Q2, we came closer to meeting 100% of the customer demand than in any other quarter. So that’s an improvement. One thing that we did highlight was this issue with a microcontroller that is used in a few digital clusters at Visteon that had a disruption in supply.
