Wabash National Corporation (NYSE:WNC) Q4 2022 Earnings Call Transcript

Felix Boeschen: Got it, okay. And then I don’t know if this is maybe best for Brent, but I’m just curious if you can help us understand the, call it, direct versus dealer channel mix in the trailer business today and where you think that might go long-term just post the capacity expansion. I’m just trying to understand that all these changes from a multiyear agreement perspective might change the mix over time?

Brent Yeagy: Yes. So today within Wabash in respect, specifically talking dry van now, it is approximately a 50-50 split between direct and indirect. And that number or that set of numbers is a direct result of purposely increasing the indirect channel or dealers from roughly about 30% to 50% of our dry van allocation. And if you think about what we want to see, let’s say, about 20% long-term agreements in the direct side and I’d love to see closer to 10% of that allocation or that capacity on the indirect side and that’d be a nice mix for us that we think would fit a real nice subgroup of customers that have a long-term vision, and we’re going to be able to play this market really well.

Felix Boeschen: Okay, got it. And then just my last one, these long-term agreements, are they mostly with existing customers today. What I’m really trying to understand is to what degree, call it, the rise of power only brokers out there and just to build out of trailer pools, does that open up, just completely incrementally new customers to you, and would those type of customers be interest in long-term agreements. I’m just trying to think through mix implications long-term Brent?

Brent Yeagy: Yes. So today when we think about long-term agreements, they are primarily predisposed to those customers that had a more traditional first to final mile view, they buy across our portfolio and they are well positioned from a leadership and a business model standpoint to outgrow the overall industry based on the structural changes we have going on. That’s how we look at it today. And when we think about trailers as a service, digital brokerage and power only, you are absolutely right that as a new subset of customers that will grow in scale that we’re purposely cultivating today that we think become much more material ’24 and beyond. And as a core part of our commercial constructs today, the way we’re not going to be allocating capacity in the future and the systems that we’re bringing to bear and capabilities of the organization.

Operator: We have no further questions at this time. I’ll turn it over to Mr. Reed for any closing remarks.

Ryan Reed: Thanks Chris, and thanks everyone for joining us today. We look forward to following up during the quarter.

Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.