GNTX
#Yes, it's a new market that is still in development, obviously.
We have low-volume production vehicle that is going in there right now, late this year.
A couple more OEMs that start production with HomeLink into the China market, beginning of 2017.
Our only constraint is that it's still a new market.
Lot of vehicles.
Easy implementation, but it's the selling and creating a business case for the OEM on why it's a necessity.
Thank you.
Nothing that we are going to break out specifically in the region.
It was really driven by growth and penetration of, again, the same OEMs that we are shipping to in all the regions, just further penetration and uptake of our primarily inside mirrors in that region.
Looking at the luxury OEMs in Germany are the primary drivers of that.
But we did fairly well with Volkswagen during that time as well.
We continue to see strength with all of our German OEMs.
Between 5% and 6%.
I wouldn't look at it as a trend.
If you back up more than the last few quarters you are referencing and look at the two years prior to that, outside mirrors were outpacing inside mirrors.
Outside mirrors in fact in that two-year period prior to the quarters you referenced, some of those were in between 15% and 20% growth rate.
Part of it is just the law of large numbers and the compounding effect of those large growth rates on outside mirrors, and then them coming back down to a more normalized level.
Additionally, what we talked about was we had one luxury OEM who was going through a de-contenting to try to address some cost concerns.
So, we did have some fairly small but somehow still changing the numbers, obviously, change based off that OEM going through those cost pressures, and then de-contenting some outside mirrors.
When you see that and you look at those, if those units had stabilized and that hadn't occurred and you look at the growth rates, it would have been right in line with what our historical growth rate, and more in line with what those inside mirror growth rates were.
Good morning, <UNK>.
Any time we get below ---+ as sales drop in the mid-single-digit range, that is when you start to see pressure.
If they start to flatten to zero and then they decline, obviously, we invest heavily in automation.
There is some fixed cost base.
We do have some natural hedges built in with the way the variable compensation works with the Company.
But, again, outside of product mix, if we can be in the mid-single digit, to close to double-digit growth rates, we feel like we can manage it in the range we have been talking about for a long, long time, 38.5%, 39.5%.
Obviously, when the stars align, we did better this quarter.
So, we feel like, given our forecast and everything outside of a macro event, we feel fairly comfortable that margins are going to be in the range that they have been.
If you back up, just to walk through the progression is the best way to look at it.
If you back up a year, I'd say they were all optimistic.
The Detroit 3 and the international guys were looking at the North American market as solid growth driver for them.
I would say now I would characterize it more as cautiously optimistic.
You start to see a few people that are a little more negative than the cautiously optimistic.
That is about the product lineup and how their vehicles are doing inside the marketplace today.
The one thing that's very interesting is trucks and SUVs continue to do really well in this market.
So, from a content standpoint, that usually bodes really well for us.
We continue look at it and say, hey, what is the mix change going to be.
One thing that's interesting is when you watch fuel prices drop like they have been recently or continue to at least be at lower levels, you tend to see the mix move a little bit away from A and B segment and more towards trucks and SUVs, which obviously plays well for us.
We have an expanding book of business, however, in the B and C segment in North America.
That's where a lot of the growth has come from for us over the last 18 months to two years.
So, we feel like we are well positioned.
I would say OEMs are a little more cautious than they were a year ago on the North American market, but we continue to see content and features being the key to driving growth rates for this marketplace.
If you look at a lot of the technologies we have been working on over the last several years, if you look at the HomeLink play, talk about the integrated toll module, and what we are working on is a connected car strategy, that includes HomeLink and includes the transactional vehicle in our toll module product.
We believe we have a very unique position in the marketplace to be able to help equip cars and OEMs with the type of technologies they are looking for.
If you look at our camera technology, our full-display mirror system, all these technologies align well with what OEMs are trying to accomplish inside the autonomous vehicle space.
It doesn't mean that everyone views autonomous as if you are the algorithm provider for autonomous that that is the only play.
That is clearly not the case.
You are looking for comfort and convenience, security, those type of features that can help drive Gentex growth into the car of the future.
Thanks, <UNK>.
