Ford Motor Company (NYSE:F)
August 2008 U.S. Sales Call
September 03, 2008 1:00 pm ET
George Pipas - US Sales Analysis Manager
Ellen Hughes-Cromwick - Ford’s Chief Economist
Brian Johnson - Leman Brothers
Rod Lache - Deutsche Bank
Chris Ceraso - Credit Suisse
Patrick Archambault - Goldman Sachs
Jeff Bennett - Dow Jones
Bernard Simon - Financial Times
Tom Harsha - Associated Press
Joe Szczesny - Oakland Press
Welcome to the Ford monthly sales conference call. (Operator Instructions) I would now like to turn the presentation over to our host for today’s call George Pipas, Ford sales analyst.
Thanks for participating in Ford’s August sales conference call. Joining me today is Ellen Hughes-Cromwick, Ford’s Chief Economist. Jim Farley’s travel schedule, I just want to say at the outset, did not permit him to participate in today’s call. I know Jim looks forward to joining us again next month, but we just couldn’t make it happen this month. I’m going to begin by letting Ellen update you on the economic news over the past month and try to put that into perspective and give you insights about that; Ellen.
Well, as you know we had a fairly challenging environment for the consumer, but the month of August in fact did bring some welcome relief with lower gasoline prices and some stability in consumer confidence and as you’ll see a slight up-tick in vehicle sales.
They are early indications of what seems to be a some what improving condition out there, but there’s some old news out there as well. You may have seen the fact that the government released a sizable upward revision to economic growth in the second quarter. It was a headline number of 3.3% and the latest news does show that some momentum has faded in the third quarter. You may have seen inflation for consumers is now above 5% and consumer spending has been certainly weak.
I’d like to come back just for a minute to some of these constructive developments in August, mainly the decline in gasoline prices. We’ve seen now gas prices come down about $0.40 a gallon since mid July and that is really equivalent to a tax cut of around $60 billion at an annual rate and on the margin there has I think been a very welcome development as we’ve seen the global economy weaken up energy demand.
The other point I want to make is around consumer confidence. The University of Michigan’s confidence reading for August rose slightly to a level of around 63, so that now has been two consecutive months of gain. We do still have sizable head wins out there; we’ve mentioned in prior calls, the home situation, the housing market being very weak and as well the fact that the credit crunch does persist and that is really a situation that we think adds a lot of uncertainty in the market place and our best guess is that it will take several months for those conditions to improve.
We see some pressures remaining of course on auto financing products and particularly sub-prime and leasing and we do think that would potentially constrain sales for the balance of the year. August sales, we estimate right now are coming in at about 14.1 million units SAAR and that does by the way include medium and heavy sales and that’s up as you know from what was a very weak July.
So after a few months of the sales declines, we think that in and of itself is a welcome development. We think the near term outlook is still on the low end of that 14 million to 14.5 million unit range for the full year, so with that I’d like to turn it back to George to talk a little bit about the sales details.
The first thing that I would like to comment on is the segment sales trends that we’ve seen, both on a year-over-year basis and also on a sequential basis. First let’s talk about segment sales on an industry wide basis.
When you began to categorize and then the vehicles according to their segments as the data becomes available today you will find that once again compared with last August a year ago, small cars in particular were strong, you may see some strength in mid-sized cars perhaps as well and you’ll see sharp declines in the full size truck and SUV into the market. So on a year-over-year basis, you’ll see similar kinds of results that we have particularly in the last few months.
Ford’s sales result is pretty much in line with the overall industry. On the first page of the tables provided in the release, you can see that Ford, Lincoln, Mercury sales are down 26% in total. Passenger cars are down 9%. See these, the car based utilities are down slightly, 1%, but then we see in the Ford sales report what I was talking about for the industry, sharp declines in SUV’s 53% compared with August a year ago as well as the truck and van categories, the full size truck and van categories down 39%.
Now sequentially you see a some what different picture. An improved picture for the larger trucks and SUV’s and I’m going to harken back to comments that we made, that tried to provide you some guidance on what to expect as we progress through the summer.
I think it was in June that we indicated, the limited availability of small cars would provide an artificial cap on those products as we progress through the summer, a cap that probably we would not see some relief until perhaps the fourth quarter. In fact that seems to have been the case, because back at the beginning of the summer the industry wide day supply of small cars was around 30 and full sized pickup day supply in that period was about 140. So with the tight availability, manufacturers reduced incentive spending on the small car category.
We saw transaction prices elevate at the retail level and the combination of higher prices and limited availability resulted in a decline in small car sales, at least their share of the total industry from those elevated May and June periods. In contrast with the excess day supply of full sized trucks at the beginning of the summer, incentives on those products increased.
To give you an example, you remember Ford was talking about a retail share of the full sized pick up segment back in May of about 9% and that persisted basically though June, but in July and August it was elevated to the point where in August its kind of in the 12% range. So this SUV show is similar, although not quite as exaggerate trend, the decline and then followed by a small rebound.
Some people have attributed this to gas prices and I’d say lower gas prices certainly didn’t hurt the situation and in fact may have kept some people that were on the fence who had trucks or sport utility vehicle and more on of the fence, may have kept them in the segment, combined with the higher levels of incentives that allowed them to get out from a negative equity position.
I think it will be interesting to follow this and we certainly will be doing so in reporting back to you on how this segment trend proceeds sequentially as we get though an area of very excessive truck inventories to something that’s much more reasonable and perhaps we see small car availability improve in the fourth quarter.
It brings up the question of inventories and I’d like to report on that first among the various house cleaning items that we covered each month. Ford ended the month with a total of 461,000 vehicles in inventory, 142,000 passenger cars and 319,000 trucks to include vans and crossovers and the other products that are in the light truck category.
Now this is a reduction, this 461,000 unit level is a reduction, this 461,000 unit level is a reduction of 37,000 units compared with last month, at the end of July when we were at 498 and a positive development is that from one month to the next our car inventories with somewhat less incentives and the expected impact on sales rates, car inventories actually improved, were higher that is, which from our stand point is a positive development, because they were historic lows and truck inventories were shaved from about 369,000 units to 319,000.
Now I did just take a look at some selected products, namely F-series before I came up to the conference room and so I want to report that of the 37,000 unit decline in total inventories from one month to the next, 32,000 of the decline was the F-series and another 8,000 was traditional SUVs, products like Explore and Mountaineer. Although in Ford sales report we don’t typically highlight this, I think that it’s an important below the radar development as it relates to the launch of our new product.
In May we called the sharp decline in truck segment sales and immediately took action, took action again in June and more in July and as a result of those actions and the steady sales rates for pickups in this late summer period as a result of the higher incentives we are getting to the point where now we’re actually ahead of the schedule that we were plotting two months ago and by that I mean this; a couple of months ago we saw the old new model mix of the F-150 getting to 50-50 old new by sometime in February.
Now we believe that that event is going to occur in December and it’s a positive development of the old model inventories, a positive development because with the old models come higher incentives, higher floor plan expense for our dealers and importantly when we begin to do the marketing launch for the new F-150 in December we can concentrate on the product and its capabilities rather than the expense of continuing to promote and try to merchandize ourselves out of an old model inventory problem.
This has been obviously a team effort on the part of the sales team and our dealers to try to get ourselves into a more favorable position as we end this calendar year and bark on the launch of the new F150.
You’ll notice that we have updated our production plan in North America for the second half and the particulars are in the sales release. I’ll just summarize by saying there is a reduction of 50,000 units in the second half from the plan that was announced at the end of July. There’s a lot of pieces but I tried to put the major contributing factors in the release and I’ll just articulate them now.
One is a further reduction beyond what was planned in sales to daily rental companies. You may recall that in the first half, daily rental sales at Ford were down 20% compared with the year ago and at that time I said that we should expect second half daily rental sales would be about flat or roughly equal to the second half of 2007. Now we believe that the full year reduction will be about 20% which means that the second half reduction will be similar to the first half reduction.
This is in response not only to our own desire to reduce participation in the daily rental channel as total industry sales go down, but also to important steps that daily rental companies are taking to adjust their mix and their business models to accommodate reduced levels of business travel and vacation travel in line with the weaker economic conditions.
So we probably won’t update you anytime soon but I know I went on record as predicting that we probably have three months up and three months down in fleet sales in the second half and now it looks like that the increase that we reported in July could well be the only increase for the rest of the year and I guess that would make it the only increase all year long in fleet deliveries.
The other pieces of the production decline, one just to relate to our planned transfer of Ford Expedition and Lincoln Navigator production from Michigan truck. This is one of the three truck plan which will be converted to smaller vehicles in the future and the Expedition and Navigator production is going to be moved to Kentucky Truck Plant, where we also produce right now the Super Duty F-Series truck.
We had planned to embark on that transfer physically in the first quarter; we’re going to do it instead towards the end of this year, that results in less Expedition Navigator production and also less Super Duty production in December as we close the plant for a period of time in advance of the Christmas holiday to make the changes that are required to the Kentucky Truck Facility and accomplished training.
The third piece is just we’re edging down our forecast of industry sales. It’s not a major adjustment in our thinking. As Ellen said, fundamentally not withstanding a few positive developments, the underlying economic condition and the credit situation are basically unchanged, but just edging down to the lower end of the 14 million to 15 million range.
Other house cleaning items are retail and fleet sales. They are both roughly the same. In the overall reduction of 26%, we have a 24% reduction in retail sales this month compared with last year. As you can imagine from looking at the absolute numbers, the total sales, the lion’s share of the reduction is in Sport Utility Vehicles and trucks and actually crossovers in cars are basically just slightly lower in the aggregate than a year ago.
On the fleet side, the decline is 31% this month and I guess I should point out, that makes this months fleet mix 21%; something I usually provide. You can see for those of you who have been following our results this year that that’s quite a bit lower than what we’ve seen in months past because heading into August, the year-to-date fleet mix through July was 35%. So this is quite a bit a step down in the month of August from where we were on a year-to-date basis.
Among the cars I hasten to point out that Focus continues to do well, the Escape continues to do well, both of the 2009 model products the Escape with its new four speed or four cylinder engine and six speed transmission offers class leading fuel economy, 28 mpg for the gas engine on the Escape and 34 city for the hybrid version.
Focused highway fuel economy is 35 and there is no doubt that this has been a contributing factor as have some other factors to Focus’s one of the real segment leaders in terms of increases in a very popular segment anyway. So we are pleased that that continues and you can see the consumer interest and fuel efficiency continues as well.
With that I would like to open it up for questions and we’ll look forward to hearing from you.
(Operator Instructions) Your first question comes from Brian Johnson - Leman Brothers.
Brian Johnson - Leman Brothers
Yes two questions, one around pick-ups and then the other is frail and around consumer confidence. On the pick-ups George when you look at the sequential improvement and you think about the segments you’ve talked about in terms of construction use, personal use or the product mix like crew cabs versus basic cabs; any color on where the sequential improvements seem to be coming from?
Primarily in the lighter duty products on a sequential basis, the F150 light duty product line, both regular cab, super cab and crew cab improved sequentially. Jim has previously commented about the market is less personal use today than what we had come to think of it back in 2004 and 2005 when maybe as much as a third of the people who purchased full sized pickup truck, particularly light duty were for the most part a personal use buyer.
Not that they didn’t use the better pickup or something but generally along the lines of personal use and as we commented in the past we’ve seen some decay in that buyer. So that the buyer that we are going to confront as we introduce the new truck is going to be lined up more towards the person who uses the product for the line of work okay, anything else.
Brian Johnson - Lehman Brothers
Well just one follow up question; do you have the mix for 150 versus 250, 350?
No, I don’t have the mix with me; no. We can follow up on that if you care to with Larry or myself for that matter later on.
Brian Johnson - Lehman Brothers:
And for Ellen, how are you looking at the relationship between consumer confidence which is sequentially up in auto sales? Is that one of the reasons where we maybe coming off this trough of 12/6 or is this something that could go -- in the future our consumer’s more confident, but they can’t get loans, so it doesn’t matter?
I think it does matter Brian, a really good question. It’s one ingredient among many. As you know the top line GDP growth is really the most important determinant vehicle sales and so income gains if you will are critical. I mean you need to see the economy begin to recover in order to get a little sunlight on the vehicle sales outlook, but the fact that we saw confident bottom it appears and at least it’s not going down further is very constructive.
I don’t want to overplay it but I think it’s a helpful development and we’ll continue to kind of watch that very closely. There’s some really good details in the survey as you know on good time to buy a vehicle and bad time to buy and those have also started to flatten out. So nothing more than just staying “look it’s starting to stabilize a little” and I think that’s a positive in and of itself.
Your next question comes from Rod Lache - Deutsche Bank.
Rod Lache – Deutsche Bank
George, in June you suggested that the SAAR was supported by incentives and that there’d be some payback which happened in July and then looking at the past months Chrysler was discounting pick-ups by 40% and you had the GM employ discounts.
I guess, are you saying this is a similar pattern or are you expecting some payback as you head into September and then for either of you Ellen or George, is there anyway that you guys are quantifying the extent to which credit availability is affecting sales. I don’t know whether you have any stats on lease versus buy or how things are changing?
I’ll give Ellen a chance to think about that second question Rod. The question about what do we expect to happen, I would expect that we would see softer sales in September. In fact you may recall when the surge in sales that resulted from GM 72 hour program occurred, that month, the month of June looked like it was going to have a $12 million handle on it or may be a mid $12 million handle on it and then it ended up with about $14 million industry, but predictably payback occurred in July and we did get the 12 handle number in the month of July.
Now for the first 20 days roughly of this month it looked like another twelve possibly low 13 million sales months until the employee purchase plant price and then that’s when the pick-up in the sales rate for the industry occurred. That being the case and that was standing what appears to be an extension of the program we would expect that industry sales would experience some payback in the month September.
So I think you got a summer time period which looks like maybe the rough edge of a rough cut saw. A spike followed by a decline, followed by a spike and then possibly another decline to a lower level than September. So Ellen what about the second question?
The credit market situation is affecting auto sales. I think it’s a question of to what extent. You had an economy growing at almost 3.5% in the second quarter and yet that was the most pronounced decline and any model that didn’t include some element of the credit market in it wasn’t going to forecast the kind of sales out turn that we had.
So we think that yes, there has been an affect and its been concentrated so far this year in a decline in sub-prime retail sales in the market place, so the data do show that we’ve had a knock down if you will for any customers that have a fico below 620. Now I’m talking about the total industry sub-prime sales. So that has been an affect and has contributed to this lower selling rate.
Your next question comes from Chris Ceraso - Credit Suisse.
Chris Ceraso – Credit Suisse
You mentioned in your remarks towards the midsize car segment was one of the stronger performers, but it looks like the Fusion and the MKZ were pretty weak. Is that a comp problem for you, is it a mix problem, do you have insufficient availability of four cylinders; why are those cars kind of weak for you?
Well there are several factors involved. I think we talked a little bit about this at the top of the call. I think Jim spoke to this last month Chris and I think it bears repeating that when dealers design their pay plans and construct their incentives for the coming weak and month to their sales force.
They’re going to concentrate on the things that they have a lot of and it so happens that they also make money on large trucks and so with 140 day supply this summer and manufactures upping the water level on incentives on trucks, full sized trucks, pick-up trucks in particular, I think we saw a kind of a lack of attention on the midsized car at Ford, the Fusion.
Now interestingly on a year-to-date basis our share of the retail market for these products has held up real well, but in the last couple of months it’s fallen off. Some of it, but I don’t think a lot of it could be due to the fact that as you well know these midsized products at Ford are entering the last few months before we begin the change over to the 2010 model Fusion, Malone and MKZ including a couple of hybrid versions, so there could be a little bit of that going on, but I really think it’s a question of where we put the resource and where the dealers put the resource this summer to accomplish that sell down task. Good observation though.
Chris Ceraso – Credit Suisse
On the focus, are you constrained at all on availability and what’s the current run rate of sales that you think you’re at?
It really does depend importantly on availability, because in May you may remember, sales were over 30,000 which haven’t happened all that much in Focus’s history. Since then it’s fallen these last couple of months down to 16 and 17 which is right in line with the beginning month inventory.
I don’t think we are going to see a big improvement in the inventory situation until we get into the fourth quarter where sales seasonally are slower overall for the industry. I mean not the sales rate necessarily but the absolute level of sales is weaker in the fourth quarter than it is in the summer time and if we keep producing at vain.
I can assure you we will that should result in higher levels of Focus inventory sometime in the late fall or winter and hopefully we’ll see that the economy will be such that we can take advantage of that and pickup the sales rate at that point, but right now this is pretty much where it’s at Chris.
Your next question comes from Patrick Archambault - Goldman Sachs.
Patrick Archambault - Goldman Sachs
Can you give us a sense of where incentives are tracked for the industry as a whole and where they were for you sequentially?
Well we haven’t gotten all the data; we’ve only got it through August 24. At that point they were fairly stable, overall with where they were for the entire month of July but it picked up during the course of the month. So for the full month of July and what we have of August it was fairly stable.
Year-over-year is a much different situation. Where the higher demand for cars particularly small cars has reduced the incentives for passenger cars on an industry wide basis and I will be with you in a second. I wished I would have had my fingertips on these numbers a little bit sooner because it’s a great question. Compared with a year ago and again this August data is just through the 24th, the industry incentives were up above $300 per unit but car incentives were down about $100 a unit.
Even with a weaker industry the stronger demand for cars directed car incentives lower than a year ago, whereas on the pick-up side of the business, industry wide pick-up incentives were up about $2,000 compared with the year ago. Now sequentially it’s a different story but I don’t have the last week of the month in which there was quite a bit of activity as you may know, so it’s an incomplete story sequentially but what we have is fairly steady to this point. That’s the best I can do for you.
Patrick Archambault - Goldman Sachs
Okay and I guess related to that, some folks had quantified the inventory constraints on the car side as being maybe worth around the 300,000 units on the SAAR basis, is that a, something you would agree with and b, would you have considered August to have tracked at a similar level or are we starting to perhaps loosen up a little bit there.
I think August tracked at a similar level to what we saw in July and I mean obviously I haven’t seen all the results, but the day supply was still hanging very close to 30 on an industry wide basis for small cars as we entered the month of August and it’s your beginning month inventory that has much to say about the overall level of sales.
Patrick Archambault - Goldman Sachs
And if I can just add onto that; I mean just given what you know about production schedules, what kind of cadence would you see that sort of winding down as we get towards year end?
I’m not quite sure I understand your question exactly.
Patrick Archambault - Goldman Sachs
Well, given the production schedules at hand and some of the changes that have been made in favor of cars and this is more of an industry wide question, but when do you see that --?
There is not a whole lot more incremental car capacity coming on stream during 2008. I think what we will see is the availability will improve as we move towards the end of the year principally because sales are seasonally lower in the fourth quarter than they are in the summer and the lower level of sales combined with a steady level of car production will allow the inventory situation to improve on passenger cars and consumers will find more selection as we progress between now and the end of the year.
Let’s just move over to the journalist on the call today and take questions from them as well.
Your next question comes from Jeff Bennett - Dow Jones.
Jeff Bennett - Dow Jones
Question for both of you is are you seeing that the inability really to get credit now for consumers is becoming kind of the overriding factor here that people just can’t get the credit they once were able to?
I wouldn’t put it that way or that strongly. As you know new vehicle sales are really a function of many different factors that consumers in businesses evaluate in the purchase decision. Not the least of which is income gains as I mentioned before that happens to be the predominant variable.
What I was trying to indicate in the earlier comments is that we are facing significant head wins in the credit market, we being consumers and businesses and in particular because of the way that the financial market’s innovated on structured products, mortgage backed securities and so forth that it has now generated this action by investment banks in particular to sure up their balance sheets and as they do that they are providing less in the way of liquidity to the non-financial sector.
So i.e., if you were alone and where are they tightening up? Well they are tightening up on sub-prime borrowers and that is where we are seeing some impact on auto sales. I mean to be sure, there are some people with those unfortunately unfriendly credit scores that are getting shutout of the market.
Jeff Bennett - Dow Jones
George, do you feel also that incentives are now becoming just ineffective over all that. You really just cannot go any lower or really offer anymore deals that can move these products?
Incentives are infective in the sense that I mean just look at how quickly the sales rate elevated right at the end of the month, right at the end of June, but I think the question in the market like this is when you consider the payback in the subsequent month and look at the share of the market before and after there is usually a small if any negligible gain.
Consumers certainly respond; they have the information at their fingertips on the internet and phone calls from their dealers to make them aware of new programs and there is advertising on the TV; I’m sure you saw lots of that at the end of the month. So I think consumers respond but I think probably once you considered the payback in the subsequent month there may not be as much elasticity in the market today and there was when the economy was growing at a rate of 4% and consumers want a much better situation.
Your next question comes from Bernard Simon - Financial Times.
Bernard Simon – Financial Times
I hope I’m missing something, but I wonder if you could spell out a little more of what you see as the sequential improvement. I mean I noticed Ford’s total sales were down about 5,000 vehicles between July and August. The F-Series sales was down something more than 10%, Fusion and Expedition were also the same and you said that September’s probably going to be worse, so where is the cause for encouragement?
Well, I mean I hope we didn’t sound exuberate. I don’t think we were rationally exuberant, but I would say this Bernard; I’d have to provide a little bit more information I suppose, but our fleet mix in July was in the 30s and I can’t remember exactly what it was last month, but the fleet mix, the fleet contribution was well into the 30s in the month of July and this month it was 21% so we peeled off from July to August tens of thousands of fleet sales so it was 31 okay.
So it went down 10 percentage points from July to August and therein is the primary factor that you don’t see it on the bottom-line basis. Hope we didn’t get you excited there with our enthusiasm, but I think it was positive to see consumers respond to some of these developments in the month of August.
Your next question comes from Tom Harsha - Associated Press.
Tom Harsha - Associated Press
Did you see there were some predictions George that there would be a little bit of a truck rebound sequentially over July; did you see any of that at all?
As a percentage of the total industry, yes; we get into a little bit of a trick box Tom. Were you on the call earlier and I’m not chastising you for not being on the call by the way, but when we talked about the elevation and the level of truck incentives?
Tom Harsha - Associated Press
Yes, I heard that.
Okay, well I think the higher levels of incentives on trucks as well as a highly motivated dealer body to reduce the levels of inventory because after all these were a pretty big drag on their financial statements. They used this opportunity to sell down old model trucks and the percent that full sized pick-ups accounted for in the month of August, they had debts.
Remember in May and June full sized pick-ups at the retail level sales to individual consumers were about 9% in May and June. In July it was 11; this month in the 12’s. So yes there was a rebound relative to the overall market and part of the rebound in it’s share probably was caused by the limited availability of small cars because they didn’t have the inventory to advance in a similar fashion plus as I indicated in smaller cars we saw lower levels of incentives and higher transaction prices on small cars as we moved through the summer.
Tom Harsha - Associated Press
Okay that makes sense, but you guys, Ford in particular did not experience the same bump as the overall market when it came to the change in the share.
Well actually we did because F series represented a higher percentage of our sales too. The absolute level may not have increased, but as a percentage of the total, Focus was still hanging around 16,000 for example; the same level that it was in, in July. So I think that our share of the total Ford’s sales that F series represented was stronger.
Your last question comes from Joe Szczesny - Oakland Press.
Joe Szczesny – Oakland Press
Can you give me a little bit more color on the decline? I know you offered some explanation earlier on the decline in sales with the crossovers, but is there anything else that’s going on there; are some buyers finding these vehicles too large for their taste and for the gas prices?
Well that’s something we’ve commented on in the past too and I think it bears repeating. I just happened to be looking at Manheim price changes by segment of the market and this is interesting; the table that I’m looking at is for the month of July, but I’m sure probably it’s pretty similar in the month of August.
The resale prices of compact cars in the month of July increased 16%; large SUVs resale values declined 26%. Now how does this relate to what we’ve said earlier; a big source of crossover sales, particularly let’s just say the midsized crossover sales is suppose to the smaller ones; a big source of sales are traditional SUVs.
You can see this in the trade in data that power provides periodically and so if I’m a large SUV owner and I’d like to maybe trade my Expedition or some similar vehicle for a crossover because that better meets my need, the decline in resale values that we’ve experienced as an industry this summer has really kept some of those buyers in their product. Would have liked to have trade, we know that it’s been an expedition to explore are big sources of sales; for example the Edge.
If they’re underwater as a result of these deep declines that have occurred this summer they’re in a negative equity position and they need cash to trade, so that has slowed down crossovers here in the summer time in contrast to the double digit increases that this particular category saw throughout this decade leading up to the summer really, so we’ll see how it develops.
I think one thing that will help is as the manufactures reduce inventories of products large and midsized traditional SUVs, perhaps then you won’t see zero for 72 or some other generous offer on those models and they’ll be more inclined to look at the crossovers even though the incentives are not quite where they are for the traditional SUV’s.
Okay, well I’m five minutes over. I’m sorry that I didn’t get to everybody. I sure appreciate your participation. Thanks for calling in and will all look forward to talking to you next month.
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