From the recent conference call:
There is no doubt that we have had a very challenging third quarter and we expected to continue to face headwinds from the commercial truck and other industrial segments over the next two to three quarters. The good news is, there is an underpinning for a fundamental recovery in the commercial vehicle market over the next several years. Manufacturing appears be holding its own with September’s ISM reading providing some reassurance.
The age of fleet is at 6.7 years and it’s at an all-time high going back more than 25 years. Historically, when trucks pass…the five-year and 500,000 mile mark, maintenance costs begin to rise sharply probably. Finally, freight volumes are continuing the trend of modest growth.
Accuride is a rebuilding company, having emerged from bankruptcy a few years ago.
…we are implementing lean manufacturing systems across the organization and are moving the company in the right direction with the goal of bringing all of our facilities up to the same high standards that we have already achieved at Henderson and Erie. I have worked with a consultant who is at Toyota veteran at three different companies and the marks he gives us for Erie and Henderson are the highest marks I have heard from him ever in the last 10 years of working with him.
An analyst clarification about guidance for cash flow:
Kirk Ludtke – CRT Capital Group
I am also looking at the implied fourth quarter guidance and with respect to cash flow it looks like you are looking for cash flow break even in the fourth quarter. Sounding about right?
Gregory Risch – Chief Financial Officer, Vice President
Yes, thats right.
The downturn in the industry which, as some of you who have been in the business much longer than myself, I have been here 20 months, I have got people who have been here 20 to 40 years. They said the downturn we experience in the third quarter is the steepest and most rapid declines they have ever seen their careers here.
Okay, so hopefully I have also been told, when it turns it turns up fast and I experienced that last year. We are much more well positioned to handle an upturn if there is an upturn next year…
Accuride Corporation, together with its subsidiaries, engages in designing, manufacturing, marketing, and supplying commercial vehicle components in North America. The company offers heavy- and medium-duty steel and aluminum wheels, light truck steel wheels, and military wheels; and wheel-end components and assemblies, such as brake drums, disc wheel hubs, spoke wheels, disc brake rotors, and automatic slack adjusters. It also provides truck body and chassis parts comprising bumpers, fuel tanks, battery boxes and toolboxes, front-end cross members, muffler assemblies, and crown assemblies and components, as well as fenders, exhaust components, sun visors, windshield masks, step assemblies, brackets, fuel tank supports, inner-hood panels, door assemblies, dash panel assemblies, and various other components. In addition, the company offers ductile and gray iron casting of transmission and engine-related components, which comprise flywheels, and transmission and engine-related housings and brackets; and ductile and gray iron casting of industrial components, such as flywheels, pump housings, small engine components, and other industrial components. Accuride Corporation markets its products under Accuride, Gunite, Imperial, and Brillion brand names. It serves heavy- and medium-duty truck, and commercial trailer original equipment manufacturers (OEM); and aftermarket suppliers, including OEM dealer networks, wholesale distributors, and aftermarket buying groups. The company was founded in 1986 and is headquartered in Evansville, Indiana.