Good morning, everyone, and welcome to the Lear Corporation First Quarter 2023 Earnings Conference Call. [Operator Instructions] Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Ed Lowenfeld, Vice President, Investor Relations. Sir, please go ahead.

Thanks, Jamie. Good morning, everyone, and thank you for joining us for Lear's first quarter 2023 earnings call. Presenting today are Ray Scott, Lear President and CEO; and Jason Cardew, Senior Vice President and CFO. Other members of Lear's senior management team have also joined us on the call. Following prepared remarks, we will open up the call for Q&A. You can find a copy of the presentation that accompanies these remarks at ir.lear.com. Before Ray begins, I'd like to take this opportunity to remind you that as we conduct this call, we will be making forward-looking statements to assist you in understanding Lear's expectations for the future. As detailed in our safe harbor statement on Slide 2, our actual results could differ materially from these forward-looking statements due to many factors discussed in our latest 10-Q and other periodic reports. I also want to remind you that during today's presentation, we will refer to non-GAAP financial metrics. You are directed to the slides in the appendix of our presentation for the reconciliation of non-GAAP items to the most directly comparable GAAP measures. The agenda for today's call is on Slide 3. First, Ray will review highlights from the quarter and provide a business update. Jason will then review our first quarter financial results. Finally, Ray will offer some concluding remarks. Following the formal presentation, we would be happy to take your questions. Now I'd like to invite Ray to begin.

Thanks, Ed. Now please turn to Slide 5, which highlights key financial metrics for the first quarter. Lear started the year strong, delivering significant increases in both revenue and earnings in the first quarter compared to last year. Sales increased 12% to $5.8 billion, and core operating earnings increased 43% to $263 million. Adjusted earnings per share increased 54% to $2.78 per share. Slide 6 outlines key highlights for -- from the quarter. Both Seating and E-Systems had significant growth over market and higher margins as compared to last year. In Seating, we are excited to announce that the Conquest award we mentioned on our last earnings call is for the Wagoneer and Grand Wagoneer. They will be producing complete seats in key thermal components for these vehicles, with production beginning later this year. This Conquest award is another example of Lear's strong reputation for quality, operational excellence and product execution, as we expand our strong relationship and partnership with Stellantis. In E-Systems, we continue to increase momentum in electrification with additional awards for 2 of our innovative products. Stellantis recognized our advanced technical capabilities as the premier supplier of high-performance battery disconnect units and selected Lear to supply the BDU for a new electric vehicle. We continue to increase our Intercell connect board backlog with the award of additional volumes from General Motors to support their Ultium Battery platform. Our customers continue to recognize Lear for innovative technology and quality. For the sixth consecutive year, we are recognized as a supplier of the year for General Motors. I'm excited that we completed the acquisition of IGB, which will play a key role in expanding our Thermal Comfort Systems business and increasing our market share and margins in Seating. I want to thank everyone who supported this transaction. There's a…

Thank you, Ray. Slide 12 shows vehicle production and key exchange rates for the first quarter. Global production increased 6% compared to the same period last year and was up 8% on a Lear sales weighted basis. Production volumes increased by 10% in North America and by 17% in Europe, while volumes in China were down 8%. The dollar strengthened against both the euro and RMB. Slide 13 highlights Lear's growth over market. For the first quarter, total company growth over market was 6 percentage points, driven by favorable platform mix and the impact of new business in both segments, with Seating growing 6 points above market and E-Systems growing 4 points above market. Growth over market was particularly strong in Europe and in China. In Europe, sales outperformed industry production by 12 points, with both business segments benefiting from higher volumes on the Land Rover, Range Rover and Defender. New programs such as the BMW 7 Series in Seating and new wiring and electronics content on the Volvo XC40 and XC40 Recharge in E-Systems contributed to the strong growth in the region as well. In China, growth over market of 8 points resulted from strong production on the Mercedes C-Class and E-Class in Seating and the Volvo XC40 and XC40 Recharge in E-Systems. Our North America business lagged industry growth estimates by 1 percentage point. This was driven by unfavorable platform that's primarily related to the changeover of the Ford Escape in E-Systems, which was partially offset by the benefit of new business. Turning to Slide 14. I will highlight our financial results for the first quarter of 2023. Sales increased 12% year-over-year to $5.8 billion. Excluding the impact of foreign exchange, commodities and acquisitions, sales were up by 14%, reflecting increased production on key Lear platforms and the…

Thanks, Jason. Please turn to Slide 20. The first quarter was a great start to the year. Both business segments saw year-over-year margin growth, with strong growth over market. Our Lear Forward plan continues to yield results. The team has identified and implemented actions that will reduce costs and improve operating cash flow. We continue to win business in both Seating and E-Systems, and our pipeline of new opportunities is very strong. Closing the IGB transaction was the final piece required to solidify our thermal comfort systems strategy. With this completed, we are looking forward to giving you a comprehensive update of our Seating business, with a particular focus on thermal comfort on June 27. We'll be hosting a Seating Product Day on Lear Campus in Southfield, Michigan. We look forward to seeing many of you in person. In closing, I want to thank the Lear team for their tireless efforts that resulted in another strong quarter. I firmly believe we have the best team in the industry, and I am proud to work with you each and every day. Now we'd be happy to take your questions.

[Operator Instructions] Our first question comes from John Murphy from Bank of America.

Maybe just to ask one simple one first, just on scheduled stabilization. I'm just wondering if you could kind of highlight how much they've stabilized in the first quarter, how much sort of the disruption caused to you last year and what do you expect to not reoccur this year?

Look, actually, this year, I always say everything is all relative. It's -- this year is a lot better year than last year. When we talked about just stable production from our customers, we're getting a lot better clarity around if there is going to be downtime, so that we can respond a lot quicker in respect to what we can do internally from an efficiency standpoint. So much more clarity around the production environment, although there's been still some short notice, but much better than it was last year as far as the financial strength. Jason, do you want to add to that?

Yes. Really, it was -- we didn't see a meaningful premium cost in the quarter. It did improve versus the prior year. We've seen a gradual improvement, John, as you look at sort of first half of last year to the second half of last year and then again in the first quarter. As Ray mentioned, we're still incurring some premium costs. We're still seeing some stop-start production from our customers, some challenges with some of the new programs that our customers are changing over and some challenges with our supply base, which weighs a little bit on the conversion rates you see with volume in the backlog, but certainly less meaningful than what we experienced over the last 2 years.

Okay. And then just a second question on IGB in the acquisition there. Is there a greater opportunity on content with EVs as you're looking at sort of the in-seat HVAC systems essentially versus what you have on the ICE? And I think you also -- I just want to follow up on something I think you mentioned that -- you said CD margins, which are targeted 7.5% to 8.5% eventually. There could be upside to that 7.5% to 8.5% because of IGB. And just wanted to kind of clarify that statement as well or confirm it.

Yes, John, I'm glad you asked the question. One, I couldn't be more excited. This is a big day for Lear Corporation. This has been 10 years in the works. And going back, we're just discussing amongst the team here before the call. At 10 years, we looked at the inefficiencies within the seat. And when we talk about these priceable features and content within the seat, how they could be completely revamped and redesigned for packaging and efficiency and cost and mass and weight. And so all those elements are particularly of interest to our customers on EV vehicles. One, just the draw of -- and use of the battery consumption, the better use of the combination of HVAC in-seat seed for the occupant. Within the seat, the packaging that we're going to be able to proliferate these, I think, across multiple different seat sets. And I think equally as important, not just luxury vehicles, but be able to use in a more mid-vehicle ranges because we're going to have a much more efficient system. So short-term, we're looking at this thing. It is just we have this in 3 phases. One is just doing a really good job with our purchasing leverage, the ability to scale things properly with our manufacturing facilities on the traditional parts. And they're both great, great companies, and they complete what we're really focused on. We also protect ourselves with almost 400 patents on the new design that I was referring to as far as we get into these modular components. And we believe that, that's going to allow us to grow. And those components that we're referring to are accretive in respect to margins. So our goal is to offer our customers a great value proposition, but also more importantly to us is expand our margin, and that's really the intent of this. And it really culminated in the acquisition of IGB. Kongsberg was a great acquisition. IGB is a great acquisition. But now we're well rounded in what we're going to do as far as priceable features within the seat system.

Yes. The only thing I would add, Ray, to what was important about IGB, it brought steering wheel heat and panel heating, which I think also plays an important role as you think about reducing the use of the HVAC and the impact on the battery and shifting that to other parts of the interior that are more efficient for heating and cooling the occupant. So that's important additional product capabilities that we were after with IGB.

John, we talked about the Investor Day, we're going to have 2 -- we don't share a lot publicly for competitive reasons. But when you see what we're talking about as far as the transformational change of the components, when we put this in front of the customer, Frank's here, it's a layup. I mean, it's amazing. It is -- it's not traditional for us to get 100% of sourcing control on these programs. We're getting it because of the acquisitions we've made and the capabilities we have and the vision of the value that we can create. And so at the Investor Day, we are really excited about being able to disclose a little bit more about what we've been working on for over 10 years and the change to the seat system and how we believe that can -- I think this $2.5 billion to $3 billion market can grow faster when you actually have a system that creates a significant value for your customers.

And if I could just sneak one more in on the IGB Intercell connect boards. You seem like you're winning more and more on the Ultium platform. I mean that is a platform. So I'm just curious, when you think about that, how much share do you have on that Ultium platform as far as you can tell on what you've won so far? I mean, is that being dual sourced? Or are you sole-sourced on that? What's the story there?

It's still sourced today, and we have a strong position with General Motors on that particular component, yes, 50%.

And our next question comes from Rod Lache from Wolfe Research.

So I had a couple of things I wanted to ask about. The E-Systems margins currently running at 3.5%, you had guided to 4.5% for the year. And I was just hoping you could give us a little bit of color on what changes from here, thoughts on incremental margins. Does your guidance still hold? Because the -- obviously, the exit rate would be quite a bit higher to make it average that. And then on Seating, is it typical that incremental margins on new business would come in, in the mid-6s? Or is that something that we should extrapolate from?

I'll start with the second part of the question first, Rod. So Seating backlog has been rolling out in the 8% to 10% range. And I think if you look out over the next couple of years, we would anticipate that, that's about the rate it would roll on. Sometimes, you have a blip in a quarter where you have a mix of what has rolled off versus what's rolled on. But it's generally in that 8% to 10% range is what we're seeing. If you look at the last number of quarters, that's what we've converted at. In terms of E-Systems margins, you're right. We do expect to see higher margins in the second half of the year than the first half of the year, so at 3.5% here in the first quarter. If we look out in the second quarter, the midpoint of our guidance, we would expect similar margins, maybe slightly higher in E-Systems in the second quarter, which means the second half needs to be roughly 5.5%. There's a number of catalysts to that. One, our launch costs in the first half of the year are much higher than they will be in the second half of the year. We're going through not just launching the backlog, but we had significant new program changeovers. So the Ford Escape, which we had referenced in the prepared remarks, but also the Colorado Canyon with GM is a big program for E-Systems. So those 2 programs, we had a significant investment in launch costs in the beginning part of the year, and that will be less in the second half of the year. In addition to that, we're in deep discussions, negotiations with our customers on commodity and inflation recovery. We did a nice job in the quarter, but we have a lot of work to do there. And we're confident that we'll achieve the assumptions that we've outlined for commodities in E-Systems for the full year. In addition to that, you have your normal seasonality. And so you had the LTA agreements that are contractual that we approved in the first part of the year, first quarter, second quarter that get negotiated throughout the year and then offset through our own cost reduction actions, restructuring actions, normal plant efficiencies, purchase savings with our supply base. And as is typically the case, particularly in E-Systems, you see that stuff sort of layered on throughout the year. And those things taken together, we believe, get us to about 5.5% for the second half of the year. And I would say the range is 5.5% to 6% in the fourth quarter, maybe even a little bit beyond that as we exit the year in E-Systems.

Okay. And I didn't quite understand kind of the net of the puts and takes that you're mentioning on commodities. Maybe you could just elaborate on that. And it sounded like the -- there's a little bit of caution in your tone, not surprising just in light of macro, but you had given an indication about potentially coming in at the higher end of your guidance range earlier in the year. Are you seeing anything in terms of customer schedules or mix that is resulting in that? Or is that just conservatism?

Yes. I would characterize it more as caution and conservatism at this stage. Nothing has changed from when I spoke at an investor conference earlier in the quarter. As we sit here today, if conditions from the first quarter hold up for the balance of the year, and there isn't a significant pullback in demand that impacts production or disruption due to the labor negotiations in the U.S. and Canada that impacts production, those things don't happen, then we see the revenue at the high end of the guidance range, maybe even a little bit beyond that. And I'll provide a little bit more color on that point, it's kind of an important point. So we have a relatively conservative assumption on foreign exchange at [$1.05] for the full year, at [$1.07] in the first quarter. That implies a little less than $1.05 through the balance of the year. And if you just kind of modeled out the last 5 days average exchange rates, revenue would be about $300 million higher than what we have included in the guidance. And that would convert at the company margin overall. In addition to that, you asked about commodities. One thing that we experienced in the first quarter that we now are expecting to continue is elevated revenue as both our -- the directed suppliers, so suppliers that our customers source directly and negotiate pricing directly with, are getting price increases, and we're just kind of an administrator in the middle passing that through. So you're seeing additional revenue without earnings as our direct-to-suppliers negotiate with our customers. That's a new development as we started the year, and that's nearly $200 million of revenue. And as we're seeing additional pressure on component cost increases in our business, particularly in E-Systems, we're negotiating pass-through…

Just to clarify, no -- you didn't mention any transactional impact from the FX just given your peso exposure. Is that essentially hedged?

Yes. So for the full year, we're about 85% hedged on the peso. And most of our currency pairs were 60% to 85% in sort of the range. We were a little less hedged in the first quarter, so we did see a little impact there. We don't see a significant for the full year at this point in time. And we have a rolling 24-month hedge program. So we flagged in about 40% of that exposure for next year as well, which should help. But -- so as we sit here today, it's not a meaningful issue. It's maybe $10 million for the full year relative to what we expected at the start of the year.

And our next question comes from Dan Levy from Barclays.

Sorry, I jumped on late, and I know you talked a bit about E-Systems, but maybe you could just address in the quarter the conversion was on volume mix and on backlog, which is meaningfully lower than what you had seen in prior quarters. So maybe you could just get a bit into the conversion on E-Systems within the quarter?

Yes. Part of that is the mix of revenue by region. And so in North America, where we tend to have a little higher variable margin profile than in Europe and in Asia. And so given the changeover activity on these key platforms like the Ford Escape and the GM Colorado Canyon, it's a pickup program. So revenue was down on those and up on our European programs and a little bit in Asia. And so that's really the driver, the sort of mix of program by region. Backlog, as we look out for the balance of the year, we expect that to continue to roll on sort of in the 10% range in E-Systems. So we feel pretty good about how the backlog is rolling on. And you can see that as continuing to be accretive to margins in E-Systems.

Understood. And then just as a follow-up, I know you said that for commodities, you're now assuming $20 million for the year versus the prior outlook $30 million tailwind. Maybe you could just remind us, within that number, what you're assuming on recoveries for non-raw material items, be it maybe some of the pass-through components, which you said you're seeing some recoveries there or freight or most notably labor on Europe. Are you assuming within that recoveries for labor where I know you had assumed that there was going to be some wage inflation on your side?

Yes. I think, Dan, at this point, we want to be a bit careful on that for competitive reasons, but we are in negotiations with our customer on labor. And oftentimes, in both business segments, we have -- we work with models that our customers have. And so the model has the labor rate input. And so that has certainly provided an opportunity for us to have a dialogue with our customers. There's a certain level of wage inflation that's our responsibility. We experience that each year, and we offset it through productivity. What we're after is really the extraordinary wage inflation in places like Mexico, where there was a significant increase in wage costs. Now in terms of the component cost increases and recovery of that, we're expecting between 90%, 95% of that will be recovered within the year. So we're not expecting that to be a significant headwind. We're expecting nearly 100% on the seating side because most of that is on direct components where our customer is negotiating with the supplier directly. The E-Systems where there's a little less that's directed, there's more work to do in those negotiations, but we still see a high level of recovery happening this year.

And can you just clarify within the $20 million if there's a gross number on that or that's the net there a gross number?

Our growth impact for this year that we're estimating at this point is about $200 million.

And our next question comes from James Picariello from BNP Paribas.

So on the E-Systems' commodities and component sourcing headwind, the 6 -- $5 million or $6 million headwind for the quarter, can you just confirm what does that impact look like through the rest of the year for E-Systems?

Yes. It's -- we see it as a little less for the balance of the year than it was in the first quarter. I think the first and second quarter will be similar. And then more of the recovery will happen in the second half of the year. So for the full year, we don't expect it to be $25 million. If you were to extrapolate the $6 million, we expect it to be less than that with the benefit of that happening in the second half.

Right. And there's some associated recovery tied to the lessening effect in the second half. Or is this just expectation on pricing?

It's recovery that's -- that drives the difference first half to second half.

Okay. And then for IGB, will the initial contribution margin for that business trend similarly to what Kongsberg -- what we saw with Kongsberg last year, losing about, I don't know, $5 million a quarter initially? And then just on that point, it's pretty clear you view thermal comfort as margin additive to Lear Seating business over time. Can you maybe just speak to or confirm the time line on when those businesses can get there?

Yes. I think that we still have some work to do on the purchase accounting, that could lead to a slight change in this. But we do expect the margins in thermal comfort to be roughly breakeven this year. And we're going through some restructuring now. Ray referenced the purchasing synergies. We're seeing some opportunities there. And so we're on track for the combined business to be profitable next year. We had talked originally about it being accretive to seat margins in '24. We still see that probably in the second half or towards the tail end of '24 because it just took longer for the IGB regulatory approval and closing to get over the finish line. So when we talk about '24 being accretive, we had assumed that, at that point, that it would be kind of the full year this year in our hands, and it's obviously 4 months later than that. So we still see this business being accretive to seat margins. And I think contribution margins are going to be similar to seating or a little bit higher, so in the 20% range, 20%, 25% even on certain programs. And so over time, as we drill that business, it will -- the impact on seat margins will continue to increase and culminate with pushing that 7.5% to 8.5% range above 8.5%. We'll save some of the details around that for the Investor Day in June. We're excited to talk about that in a little bit more detail at that point.

And our next question comes from Emmanuel Rosner from Deutsche Bank.

I was hoping to put maybe a final point on your outlook and, I guess, what's assumed in there. Q1 played out, I guess, a bit better than expected, and then you were even improving back in March. But now based on the unchanged outlook, you'd be basically assuming some sequential deterioration in profit at midpoint or maybe sort of like stable versus the first quarter at the high end, and that's despite obviously improving margins in E-Systems, for example. So can you maybe just holistically talk about how you see sort of the rest of the year play out? Where are the areas of caution that would essentially keep you, I guess, a bit more cautious now?

Yes. I think the caution is just around the production volume assumption that we have a pretty good handle on and the rest of the drivers. And just so mechanically, by holding the full year with such a strong first quarter, what it suggests is that the second quarter will be about 2.5% lower. I think the industry volumes are down about 2.5% in the second quarter from the first quarter. There are fewer work days in Europe, in North America. So we think that makes sense. So say $125 million to $200 million lower than the first quarter revenue. And if that holds, then that suggests a fairly sizable contingency, so to speak, on production volumes for the second half of the year, so it would imply pretty low revenue in the second half of the year. Again, it's early. There are so many geopolitical, macroeconomic factors in play. We just thought it was prudent to hold serve at this point. And we -- if conditions hold up like the first quarter, we would certainly look to raise our outlook in -- on the second quarter earnings call.

Understood. And then I guess one follow-up on the -- on E-Systems. So based on your outlook, maybe even like 5.5% margins in the second half, obviously, quite a bit more upside needed towards some of your midterm target. So as we look past, I guess, the second half or the fourth quarter exit rates, is the main driver there just adding more revenues and operating leverage? Or are there any other big factors to get you to your midterm view?

Yes. We talked about this, I think, on the fourth quarter earnings call. And certainly in other settings, we've described sort of that bridge from 4.5% this year to 8% in 2025. So you can look at it two different ways. One way is just looking at sort of volume and backlog. We see that as 250 basis points of the improvement from '23 to '25, and then 100 basis points of net performance. So this year, net performance is sort of negligible in both segments. We see it as 50 basis points positive in '24 and '25 through a combination of lower inflation, some continued success in passing through higher commodity costs and just fully realizing the benefits of our restructuring program and other cost reduction initiatives without that added weight of extraordinarily high wage inflation that we saw this year. Another way to look and to think about the E-Systems progression from '23 to '25, if you look at it by business segment, we talked about 100 basis points of the improvement being driven by the growth in connection systems. And certainly, this additional volume with GM on the Intercell connect board helps there. So we had previously expected $285 million of additional revenue there. It's going to be a little bit more than that now with the additional volume awarded on that platform. That's 100 basis points. If you look at our core electronics and what we're doing with that business, we see 125 basis points of margin growth over that 2-year time period in electronics, and then that sort of leaves 125 basis points for the wire business, which is a combination of net performance and stronger volumes.

And our next question comes from Colin Langan from Wells Fargo.

Just wanted to follow up. I'm not sure if I heard it right. You said there's $200 million of gross commodity headwind, but you still expect a net positive of $20 million. I guess, I'm a little confused because I thought back in '21, there was about $450 million, and you got $185 million net. So what gives you -- one, did I mishear that? And two, what gives you confidence that you could sort of get that much recovery versus the past? Are the contracts different now given the last couple of years' changes?

Well, part of it is the lag effect. So you're seeing some recovery in the first part of this year, for example, that relates to higher steel costs that existed last year. And so there's a bit of a lag benefit that we're seeing. And the balance of it really is we've worked hard to get as many of our components on an indexed agreement as we can to try and kind of insulate us from that risk. And so as there are changes that take place, that makes a little bit more straightforward to pass it through. It doesn't make it easy looking at kind of Frank has certainly a ton of work by the team in both business segments. The other big factor, though, and probably the more important factor is that we see about $180 million of directed supplier increases where it's just a one-for-one pass-through. So that's really what's driving the increase, and so there's no impact on OI. So it's 100% pass-through. So it's a little bit misleading from that standpoint. If you go back to what we anticipated at the beginning of the year, we expected the gross impact to be favorable, so $105 million because of what was happening with steel. And so now that has swung all the away in the other direction where we're seeing a gross impact that's unfavorable by $200 million. That's a $300 million change again and with $180 million of that in seating on directed suppliers has just passed through.

Got it. Okay. And then the last quarter, you talked about $85 million in gross labor cost headwinds. That's incremental to the $200 million talking about the clients [indiscernible] not overlapping. And then any color on how that's progressing? Has the majority of that already hit, so you're working to get recoveries through the rest of the year on that? Or does more of that come later in the year?

The labor inflation on the hourly side, mostly hit beginning of the year. Now some of the salary programs have various effective dates around the world. And -- but some are in January and some are later. The discussions that the customers started in the first quarter and will continue, I think, through the balance of the year. It's not going to be all done in the second quarter. It's going to take time, and some of that could even leak into next year. So it's a difficult discussion with the customers. And ultimately, we have to be the most competitive option for them, and we are. We have a world-class footprint in both segments, and I think that's supportive of our negotiations to pass these excess costs through over time.

And just one quick follow-up. Where does that fall in the walk? Is that under net performance, if I look at Slide 15 and 16? Because I don't even think there's net performance on 15. So which bucket does that added cost follow?

That is in the net performance. You're correct, Colin.

And our final question today comes from Adam Jonas from Morgan Stanley.

[Indiscernible] on behalf of Adam. We're just curious to see if you guys have seen any measurable change or slowdown in the production or orders for EVs by OEMs this year?

We're not seeing that. I mean, across the board. It's still a heavy push from all of our customers on EV, and with some customers even additional capacity and quotes are out for additional volume. So we haven't seen the demand side change at all from our perspective, particularly with the top of the OEMs. So no changes.

Okay. And then a quick follow-up. Is -- can you say that the chip shortage is over now? Or is there still incremental production...

A little hesitant to say that. Yes. I'm hesitant. I was engraved in me for a long time. I see that we're in a much better position. What I will tell you is that what we're experienced is they're still at the brokers, there's premium costs that we're trying to negotiate. There might be chips that are available through other outlets that we can get our hands on, but there's still premiums associated with those chips. So that hasn't necessarily dissipated. But I'd say generally, and I think it's all relative to where we were a year ago, we're in a much better position. There's still certain chips that are tougher to get, but I think, holistically, across all chips, we're in a much better position.

Great. Thank you, so much.

Yes, thank you. Is that the last one? Okay. So I thank Jason, nice job today. Really a nice job and there is a lot of heavy lifting for you. That's a nice job, nice job the team here and I appreciate all the hard work for everyone that's on the phone, the Lear team, incredible quarter. I appreciate all the hard work that you're doing every single day. Really good work. And again, just so I want to welcome the IGB family into the Lear family. We're really excited. I mean, this could be a transformational change for us. We've been working on this for over 10 years. And I think that the 2 very strategic acquisitions of IGB and Kongsberg were complete. We can now move on this thing and Frank can get those margins up. And so let's get to work you guys. I appreciate everything. Thank you.

Ladies and gentlemen, with that, we'll conclude today's conference call and presentation. We thank you for attending. You may now disconnect your lines.