Good day, ladies and gentlemen, and welcome to the Meritor Incorporated Q2 2016 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I'd now like to introduce your host for today's call, Carl Anderson, Vice President and Treasurer. Sir, you may begin.

Thank you, Eric. Good morning, everyone, and welcome to Meritor's second quarter 2016 earnings call. On the call today, we have Jay Craig, CEO and President; and Kevin Nowlan, Chief Financial Officer. The slides accompanying today's call are available at meritor.com. We'll refer to the slides in our discussion this morning. The content of this conference call, which we are recording, is a property of Meritor, Inc. It's protected by U.S. and international copyright law and may not be rebroadcast without the expressed written consent of Meritor. We do consider your continued participation to be your consent to our recording. Our discussion may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Let me now refer you to slide two for a more complete disclosure of the risks that could affect our results. To the extent we refer to any non-GAAP measures in our call, you'll find the reconciliation to GAAP in the slides on our website. Now, I'll turn the call over to Jay. Jeffrey A. Craig - President & Chief Executive Officer: Thanks, Carl, and good morning, everyone, and thanks for joining us today. Let me start by saying that I continue to be proud of our team's performance this quarter and over the past three years since we launched M2016. We use the word transformational to describe the change that has occurred at Meritor. We've created a new way of working that is now characterized by a dedicated focus on our most critical priorities and disciplined execution toward achievements of our long-term objectives. Simply put, M2016 defined for us the areas we knew we needed to dramatically approve upon if we were to become a company positioned for growth and greater shareholder return. Those areas included safety, quality, and delivery, product development,…

Our first question comes from the line of Colin Langan from UBS. Your line is now open.

Great. Thanks for taking my question. Any color on what drove the negative aftermarket trailer mix? Is that just reflecting the trailer growing and aftermarket start being flat (24:45) or can you give any color on how aftermarket within that is performing? Kevin Nowlan - Chief Financial Officer & Senior Vice President: Hey, Colin, this is Kevin. I'll take that. Fundamentally, it's a change in the mix of our aftermarket North America portfolio that we've seen year-over-year where we really saw the increase in brake and wheel-end components which tends to be lower margin business for us, offset by a decrease in product mix of our higher margin business which tends to be our drivetrain components. So fundamentally, we saw that mix shift on a year-over-year basis.

Okay. So it's within aftermarket. And how is the aftermarket trending? Your guidance for the year now is flat. How has it been? Within the results, is the aftermarket flat for the year-to-date or is that just a continuation (25:26) or does that imply getting better or worse for the rest of the year within Aftermarket and Trailer? Kevin Nowlan - Chief Financial Officer & Senior Vice President: Sorry. We were having a tough time hearing you, but I think, Colin, your question was is aftermarket down for the full year. Did I hear you correctly?

Yeah. Just what is the outlook for aftermarket, just broadly? I mean, because within – I'm trying to understand embedded in the Aftermarket and Trailer, how is the aftermarket actually doing standalone? Kevin Nowlan - Chief Financial Officer & Senior Vice President: Yeah. So far this year, aftermarket is slightly down in North America. But overall, we were expecting actually the markets to be up in aftermarket. But we haven't seen that as we were anticipating. On a full year basis, we're expecting the aftermarket to be relatively flat year-over-year, but what that means is that we're going to see our typical seasonal increase in revenue in the second half of the year relative to the first half of the year, particularly as we go into this third fiscal quarter.

Got it. And can you give a – just remind us where you stand with market share in terms of the PACCAR win last year? Are you – when do you – have you been increasing shares sequentially? And when do you start to anniversary the gains that you got with that customer? Jeffrey A. Craig - President & Chief Executive Officer: Well, we jumped off as (26:39) we talked about head count on – this is Jay. We jumped off as (26:42) we talked about at the Analyst Day about 50% penetration. And so, I think that we're starting to – we certainly expect year-over-year increases, because that penetration level certainly wasn't at that same level at these quarters last year.

Okay. All right. Thank you very much for taking my questions.

And the next question comes from the line of Brian Johnson from Barclays. Your line is now open.

Yeah. A couple of things. First, can you just help us think about when we think about the mix and performance? On our calculations, it's probably worth at least $9 million or $10 million in the quarter, within that volume, which is obviously a headwind I'm talking about Commercial. How do you – could you divide that between you're doing better gross margins and the products either through and then to the extent you're doing that is to what extent it's kind of moving to more differentiated products with our margins or is it materials? And then in terms of the major kind of cost takeouts or cost improvement outside of SG&A, the cost permits are going to COGS, how that played out? Kevin Nowlan - Chief Financial Officer & Senior Vice President: Brian, this is Kevin. You're right. Your math is roughly in the right range as you think about that $5 million line item we call volume mix performance and other, and there is volume and mix is a negative in that number. So you're in the right area. In terms of what that $10 million or something in that range looks like, what's driving the positive numbers there, a piece of it is lower steel indices. That's worth about $4 million year-over-year. The difference between the good news we get from lower steel prices from our suppliers and passing that back through to our customers on a lagged basis. And the balance of that is really material, labor and burden performance, driving cost performance not really, in this case, to the SG&A line, it's really been through the material, labor and performance lines, which goes through the gross margin.

Okay. And second question. What's your expectations for the revenue tailwind from new business? You started out assuming $175 million, but obviously, the end market in North American Class 8 has moved downward. And so, where are you on that, or was it maybe not tied to the Class 8 market? Kevin Nowlan - Chief Financial Officer & Senior Vice President: It was tied to the Class 8 market. When we originally announced that, it was based effectively on about a $260 million market when we're announcing new business wins. So effectively, in our guidance, we are seeing the effects of what we had hoped to achieve in terms of the new business year-over-year.

Okay, good. And just final question, given the softness of the Class 8 market, how is that playing through in terms of the couple of factors? First, OEMs' desire to use the in-sourced solutions when available, and second, just in terms of the pricing environment in the marketplace. Jeffrey A. Craig - President & Chief Executive Officer: Okay. Hey, Brian. This is Jay. Yeah, I think in answer to your first question, obviously, the one customer that has that alternative would be Daimler and we're seeing our penetrations remain stable there, consistent with the agreement that we have with them over the long-term. And then, secondly, on pricing, as you're well aware, we have long-term contracts with all our customers where the pricing remains relatively fixed other than the pass-through mechanisms for materials, which we do see. As market slowdowns occur, obviously that commodity price can decline and we can be passing a lot of those benefits to customers.

Okay. But no major attempt either from the OEMs or the fleets to push the pressures on their businesses upstream to you? Jeffrey A. Craig - President & Chief Executive Officer: No, I think everybody in the industry appreciates that this is a highly cyclical industry, and they expect us to perform on the up-cycles when they can generate significant revenue and profitability, but that also requires that we have some fixed level of expectations of what pricing will be on the down-cycles, so we can manage our business to it. So we are not seeing them.

Okay. Thank you.

Thank you. Our next question comes from the line of Patrick Archambault from Goldman Sachs. Your line is now open. Patrick Archambault - Goldman Sachs & Co.: Yeah. Thanks. Yeah, my main question is just on the margin trajectory. You're sticking with the 10%. You're running kind of in the 9.6%, 9.7% range in the first half, and it does imply – it's a little bit of an acceleration in the second half, I think, like year-on-year, like, up 80 basis points. I think we've talked about some of the factors that would help like the non-recurrence of that $6 million comp issue. But what are some of the other factors that we need to think about to get to that acceleration? Kevin Nowlan - Chief Financial Officer & Senior Vice President: Yeah. Patrick, it's Kevin. I think your math is roughly right. I mean we're expecting to effectively average something around 10.4% for the back half of the year. Now, keep in mind, we're coming off a 9.9% quarter. But nonetheless, we're expecting the full back half of the year to be around 10.4%. To put that in perspective, what that means is we have to outperform 10% in the back half by about $6 million of EBITDA if you just do the math, so $3 million or so a quarter. And there's really two fundamental drivers of that. One is that revenue in the back half of the year is slightly stronger than the front half of the year. And so, we'd expect to contribute on that. And then second, we continue to reap the benefits from our performance initiatives, the material, labor and burden performance initiatives as they achieve full run rate for the full year. Patrick Archambault - Goldman Sachs & Co.: Okay. I mean for…

And our next question comes from the line of Neil Frohnapple. Your line is now open.

Hey. Good morning, guys. Congrats on a great quarter. Jeffrey A. Craig - President & Chief Executive Officer: Thank you.

Kevin, you mentioned lower steel cost, I think, was the $4 million tailwind in the quarter. Should we expect these benefits to begin to moderate or even become a headwind later this year? Can you just remind us what a typical lag is, the changes in steel indices? Kevin Nowlan - Chief Financial Officer & Senior Vice President: I think the answer is yes to that. I mean we got some benefit in the first quarter on a year-over-year basis and some more benefit in the second quarter. But as we look at the full year, we're not expecting to see much incremental benefit from it, because in some cases, steel prices have flatted or even in North America here in the last quarter, they've ticked up a little bit. So as we look at the full year on a year-over-year basis, we think we'll see a tailwind in total, but most of that tailwind is already in the P&L that we reported for the first half. The risk we have as we look out is if steel prices were to increase, because the cost coming through from our suppliers happens more quickly than the pass-through back to our customers. And so, our outlook right now is based on an expectation that steel prices roughly moderate at where they are, which is slightly up this past quarter in North America, although slightly down still in Europe overall.

Got it. Thanks. And maybe a question for Jay. I mean just not looking for 2017 guidance by any means, but just given North America truck continues to deteriorate, again, with orders being weaker than expected out last night, just curious if you think this is more just temporary like mid-cycle slowdown, as the industry tries to work through this excess inventory, and you think we can kind of return to growth in 2017 for the North American Class 8 market. I mean just any more color you can provide on just conversations you're having with fleets and your customers. Jeffrey A. Craig - President & Chief Executive Officer: I think at this point we do still believe it is an inventory correction from the aggressive buy last year. I mean if you look at a lot of the underlying factors that stabilized and are starting to improve, I think the manufacturing index has been positive the last two months. We're seeing the outlook for ton miles to be slowly increasing over time. What we look at is over the long term, trucking moves almost exactly on a flat line (36:44) with GDP growth. So if the overall economy holds up, this inventory should clear the system and we should go back to more normalized levels. Now, will we get back to the peak demand we saw a year ago? Probably not. But can we get back to normal replacement demand orders and production? We believe so.

All right. Got it. So I mean assuming that inventory correction works its way through and we get positive GDP growth, you're saying there's no reason why we shouldn't see some North American Class 8 growth next year? Jeffrey A. Craig - President & Chief Executive Officer: Well, that's what we believe at this point, that's correct.

Thanks, Jay.

Thank you. And our next question comes from the line of Ryan Brinkman, JPMorgan. Your line is now open.

Okay, great. Thanks. Can you just update us on any progress made during the quarter relative to your pursuit of the revenue opportunity you talked about at your last Investor Day, the components area or North America off-highway don't expect that they (37:43) contributed during the quarter, but discussions you're having with customers, et cetera. Jeffrey A. Craig - President & Chief Executive Officer: Sure. Great question. On the components piece, we are working with several potential customers responding to quotes that we had developed the business stream for. And so, we're very optimistic on that. As far as the off-highway, it's a little different approach. We are developing the products necessary to address that market. We're having discussions with potential customers and getting a very clear understanding of what they would expect from us in terms of product attributes and offerings, and we're aggressively investing in those applications. And so, we're still very optimistic about that. We think we have a lot of competitive strengths to bring to both of those marketplaces, not the least of which is just a reliability of delivery, the cost of our products and also the quality that we have. So we still feel very, very optimistic about those markets.

Okay, great. Then – and just last question, it seems like Western Europe registrations have been coming in better. I'm curious if you're also seeing it with regard to your big customer over there, Volvo and is this offset already sort of included in your lower guide today? Jeffrey A. Craig - President & Chief Executive Officer: Well, I'll start with the end of (39:11) your question first. It is included in our guide, but I think it's more than Volvo. We are seeing that with Volvo, but I think what is really heartening to us is that our customer (39:25) and Renault were starting to see strengthening in that Southern European market as well which we haven't seen for several years. So I think it's across our customer portfolio base there in Europe. We're seeing a pretty broad-based recovery.

Great. Thank you.

And I'm showing no further questions at this time. I would like to turn the call back to Carl Anderson for any closing remarks.

Thank you, Eric. We do appreciate your participation in today's call. If you have follow-up questions, please feel free to contact me directly. And this does conclude Meritor's second quarter 2016 earnings call. Thank you.