Good morning. My name is Simon and I will be your conference operator for today. At this time I would like to welcome everyone to the Lear Corporation Q3 2010 Earnings Conference Call. (Operator instructions.) Mr. Lowenfeld, you may begin your conference.

Thank you, Simon. Good morning and thank you for joining us for our Q3 2010 earnings call. Review materials for our earnings call will be filed with the Securities and Exchange Commission, and they were posted today on our website, www.lear.com, through the investor relations link. Today’s presenters are Bob Rossiter, CEO and President, and Matt Simoncini, Chief Financial Officer. Also participating on the call are Terry Larkin, Senior Vice President and General Counsel, and Mel Stephens, Senior Vice President of Human Resources and Communications, as well as others on the Lear finance leadership team. Before we begin I’d like to remind you that during the call we will be making forward-looking statements that are subject to risks and uncertainties. Some of the factors that could impact our future results are described in the last slide of this deck, and also in our FCC filings. In addition we will be referring to some non-GAAP financial measures. Additional information regarding these measures can be found in the slides labeled “Non-GAAP Financial Information,” also at the end of this presentation. Slide 2 shows the agenda for today’s review. Bob Rossiter will review highlights from our Q3. Next Matt Simoncini will review our Q3 financial results and update our full year financial outlook. Then Bob Rossiter will have some wrap up comments. Following the formal presentation we will be happy to take your questions. Now please turn to slide #3, and I’ll hand it over to Bob.

Thank you, Ed, and good morning, everybody. Well, the positive momentum has continued in the Q3. The company has had its fifth consecutive quarter of improvement in cooperating earnings. We continue to win new business globally in both our key products, and we continue to report positive cash flow. For the Q3 we generated $79 million of cash. The balance sheet is strong and Standard & Poor’s and Moody’s recently upgraded our credit rating. Because of our improved operating performance and industry outlook, we are increasing our full year guidance. Matt will share that with you later. Please turn now to slide 4. This slide provides an update on our geographic mix of sales. We are well diversified, with 66% of our sales outside of North America. The Asia Pacific region, our major area of focus and effort, is growing and accounts for 15% of our sales globally. On the right side you can see Brazil, Russia, India and China have grown significantly in the past five years, from $600 million in 2005 to $1.9 billion this year. And our new business is growing at a faster rate in these countries than our traditional market. Does that make you happy, Mo? We’ve been growing in these markets since 2005 at a compounded annual rate of 28% versus the industry growth of 18%. In addition, our sales at our non-consolidated joint ventures in the BRIC markets are also growing faster than the industry. We now have $650 million annually in joint ventures. Please turn to slide 5. This slide provides an update on our balance sheet at quarter end. We have one of the industry’s strongest balance sheets. We finished the quarter with $1.5 billion in cash, in debt under $700 million with no significant debt maturities until 2018. Our credit metrics continue to improve, and the ratings agencies recently upgraded our credit rating. Also we have a modest pension liability; substantially all of our US plants are either frozen or have no future benefit accruals. Our capital structure provides us with significant financial strength and flexibility and gives Lear a competitive advantage. Now I’d like to turn it over to Matt.

Thanks, Bob. Please turn to slide #7. This slide provides financial highlights for the Q3. Global vehicle production improved 13% in the quarter reflecting industry recovery in North America and continued growth in the emerging markets. Lear sales were up 11% to $2.8 billion and cooperating earnings were $150 million, up 35% from a year ago. The increase in profitability from a year ago reflects the improved production environment, the addition of new business, favorable cost performance and the benefit of operational restructuring actions. Adjusted earnings per share was $2.28 in the Q3, and $6.44 year to date. Free cash flow was $79 million, continuing our trend of positive free cash flow generation since mid 2009. We finished the quarter with $1.5 billion on cash and total debt of $699 million. As Bob mentioned, during the quarter both S&P and Moody’s upgraded our credit ratings in recognition of our improving credit metrics and outlook. On the next few slides I’ll cover our Q3 results in more detail and provide a revised financial outlook for 2010. Slide #8 shows vehicle production in our key markets for the Q3. Overall, global vehicle production was 16.9 million units, up 13% from last year. With the exception of Europe, industry production was up in all our major markets. Slide #9 provides our financial scorecard for the Q3. As previously mentioned, sales were up 11% to $2.8 billion. Pretax income before interest, other expense, and reorganization items was $119 million, down $17 million from the prior year. In 2009, this line item benefited from the reversal of a previously recorded restructuring charge of $64 million. Excluding last year’s reversal of the restructuring charge, 2010 results improved by $47 million. Net income was $95 million, an improvement of $71 million from last year, largely reflecting higher…

Thank you, Matt. Great job, by the way. On slide 17, it gives you a little summary. We continue to benefit from restructuring actions and the industry recovery. The Q3 sales are up 11%, operating income up 35%, and it’s the fifth straight quarter of earnings improvement. Our balance sheet is a competitive advantage and among the absolute best in the industry. We continue to generate strong free cash flow, and at quarter end have a cash balance of $1.5 billion. As a result of improved industry outlook and continuous excellent operating performance, we’ve increased our 2010 financial outlook with sales up to $11.7 billion, earnings up $100 million, and free cash flow up $100 million to $350 million. The improving industry outlook, outstanding balance sheet, excellent operating performance, growing significantly in both product and region, coupled with the best team of people and I believe the absolute best management team in the business provides Lear with what I believe is a great future. I’d like to open it up for questions.

(Operator Instructions.) And your first question comes from the line of Himanshu Patel with JP Morgan. Your line is open. Himanshu Patel – JP Morgan: Hi.

Good morning Himanshu Patel – JP Morgan: Good morning, yes. So your 2010 revenue guidance was I think increased to $11.7 billion? But if I look at the midpoint of your guidance then that suggests nearly a 3% operating margin in Q4, which is quite a bit lower than you posted in Q3. Could you please comment on what is bringing your margins down in the Q4?

Yeah. The margins come down a little bit in the Q4 really as a result as the launch costs that we’re incurring in the Q4 to start launching the backlog that begins, the sales start really in the first half of 2011. That coupled with program development costs to help engineer the increased backlog that we announced on a prior earnings call, as well as there’s a slight step up in the headquarters spending. The run rate in the Q4 was down slightly. Some of these expenses are not linear; it’s a time when they get recognized. Overall we’d expect the HQ costs for the full year to be in that $190 million type range. So those are the key drivers on the margin step down in the Q4. Himanshu Patel – JP Morgan: And could you please comment on Lear’s platform mix outlook in 2011 in both North America as well as Europe?

Well, it’s a little early to start talking about ’11. Probably the best place to look for that is going to be, is CSM – they look into the outer period. Right now I would tell you this – our platforms ran very well this year from both Europe and in North America. But I’d like to stay away a little bit from ’11; it’s kind of premature at this point to get into that mix conversation. Himanshu Patel – JP Morgan: Okay. And then lastly, could you please comment on Lear’s exposure or Lear’s growing exposure to German luxury?

To German luxury? Himanshu Patel – JP Morgan: Yeah, German luxury? Do you think that German luxury production has been increasing because of some high exports to China?

There’s a lot of drivers to it. One, we have a good book of premium brands and premium car lines in Europe, like the 3 Series. We have a portion of the C-Class Mercedes seats. We do the Audi A6, so we’ve got a really nice book of high end vehicles. The sales have been strong in that segment relative to the rest of Europe for a lot of reasons. One is the demand in the region as well as the export, not only to Asia but also to North America. So we’ve had good success on those high end platforms, and we’d expect that to continue. Himanshu Patel – JP Morgan: Okay, that is helpful. Thanks a lot.

You’re welcome.

Your next question comes from the line of Ravi Shanker with Morgan Stanley. Your line is open. Ravi Shanker – Morgan Stanley: Thank you. Can you give us just a little more detail on the timing of the launch costs and the engineering costs here? Because I think you said that the second half would be much higher than the first half and obviously we do not see that in this quarter’s performance. So is there a timing issue there or is it just you guys being more efficient than you thought?

No, I think that it’s still consistent with what we said. I believe the Q4 for both launch and engineering will be higher than the Q3. Launch activity actually steps up in the Q4. The second half though is significantly higher than the first half. The first half on launch costs, for instance, we guided to about a $50 million to $60 million spend. The first half was probably about 25% of that on launch, and so the vast majority of that’s going to come in in the second half. And we’re probably going to double up – double up in the Q4 what we saw in the Q3 right now on launch. As far as engineering, we would expect a pretty meaningful step up in engineering as well in the Q4 as compared to what we saw in the Q3. A lot of it’s seasonality. For instance in Europe a lot of times car companies take time off and we will also sunset some of our costs. So it’s pretty consistent with what we’ve been seeing and what we’ve been talking about. Ravi Shanker – Morgan Stanley: Got it. And any change to your longer-term margin outlook for each segment? I think you’re talking about the 7% to 7.5% range for both segments. Do you still stick with that or do you think you can go a little higher?

No, I think in Seating we’ll stay between a 7% to 8% range longer-term. I think that’s pretty much the market rate on that. And I think from Electrical, longer-term we’ll see them as well in that range. Ravi Shanker – Morgan Stanley: Okay. And finally, what levels of utilization approximately are you running at now? Just trying to get a sense of what kind of available margins you guys go the next couple of quarters.

It’s kind of hard to give an overall type number. What I will tell you is that our adjusted time facilities are tied to the car lines that they serve. The vast majority of those car lines are not at the rate of capacity just because of the sales demand - even though they’re relatively good compared to last year they’re still below historic demand levels. So I would tell you on those facilities that we’re running a good portion below our capacity. To pick a number, probably anywhere from 25% to 30%. On the components we’re starting now to see the capacity utilization increase higher than that because we’ve taken so much production out. The key is to have the production in the right regions. I would tell you that in the emerging markets, we’re probably very close to capacity in our component facilities, and in the mature markets we still probably have some wiggle room to increase production without adding any capacity. Ravi Shanker – Morgan Stanley: Great, thanks. Great quarter, guys.

Thank you.

Your next question comes from the line of Chris Ceraso with Credit Suisse. Your line is open. Chris Ceraso – Credit Suisse: Hey thanks, good morning.

Hey Chris.

Chris Ceraso? Chris Ceraso – Credit Suisse: Yeah, so Bob, you sound a little tired. Have you been out marketing, winning new business? And if so do you have an update on your-

No, actually I’ve had a cold. I’ve got a cold, so I apologize. Chris Ceraso – Credit Suisse: But what about the new business?

What about it? (inaudible) going to tell you something. I got my lawyer sitting right on my left, he said “You’re not allowed to tell him that,” but the backlog’s growing very nicely. Chris Ceraso – Credit Suisse: Okay. Now the, I know you mentioned that there are some costs that are going to pick up in Q4 relative to Q3 but the guidance still looks pretty conservative. You’ve got a track record here of putting up numbers that are considerably better. Is that it? Is it still just conservatism? Is there any element here of the GM truck build which may decline in Q4 relative to Q3? It does look like they overbuilt those trucks.

Yeah, we pretty much are consistent with CSN’s expectation for production and what we’ve used in the guidance, Chris. To us from an expense standpoint we put a range around the outcome. Cause there’s literally thousands of inputs that go into these forecasts, and from our standpoint we’re measuring them, and we’re just trying to stay focused one quarter at a time. Right now I believe that we will have a step up in launch costs and we will have a step up in program development costs as we try to get ready for this backlog coming online as Bob mentioned. We are continuing to win new business; we’ll give a full update on our backlog in January, which is the normal custom. But you know, I think it’s a balanced guidance. Chris Ceraso – Credit Suisse: Okay, last question. You’ve talked in the past about thinking about your options on the excess cash balance. Can you comment about what your views are today, in particular how you’re feeling about maybe a share repurchase; and what you’d want to see in terms of the economic environment and vehicle demand to give you comfort to go forward and do something like that.

Well, from our standpoint it’s pretty consistent with what we’ve been saying. We’d like to maintain liquidity of about $1 billion for a lot of reasons. From our standpoint we’re well beyond that. Our focus near-term is to first and foremost continue to generate free cash flow because we believe that’s the key to creating shareholder value. We’d also look to utilize some of that excess cash organically, and what we mean by that is investing in capacity, component capacity and manufacturing in emerging markets – we think that’s key to maintaining our cost advantage in the industry. We’d also look to possibly do some strategic JVs in the emerging markets to help us diversify our sales. We’d look to expand maybe our key technologies, specifically in Power Management Systems. And ultimately we’d look to, maybe for some niche acquisitions that could accelerate our diversification of sales. Having said all that, what we’d like to see is the performance for the remainder of the year. Get a good handle on how next year looks. We would not rule out returning a portion of the cash to the shareholders in an efficient manner, and we’ll probably start having that discussion in the early part of next year with our board. Chris Ceraso – Credit Suisse: Okay, so this is not something that you’ve brought to the board yet on how you plan to return cash to shareholders?

Well, it’s always a discussion with the board. You have it every quarter and we’re aware of it, and we’re focused on creating shareholder value. Chris Ceraso – Credit Suisse: Okay, thanks guys.

Thank you.

Your next question comes from the line of Rod Lesh with Deutsche Bank – your line is open. Rod Lesh – Deutsche Bank: Hey, everybody.

Rod, do I sound tired to you? Rod Lesh – Deutsche Bank: Not more tired than me. Can you, just a couple clarification points. The $350 million of free cash flows after what level of restructuring spending?

Rod, right now the free cash flow, the use of cash for restructuring excluding CAPEX is going to be about $125 million a share. And that’s a little bit, that’s a tough number to call exactly because it’s tied into the ability to execute and customer demands and what have you. But right now that’s what it’s based on, about $125 million use of cash excluding the capital. Rod Lesh – Deutsche Bank: Okay, so I’m just wondering you’re doing over $400 million, almost $500 million of free cash flow here. It’s still recessionary levels of production in Europe and North America. It seems like, just given what your capital spending metrics are, that that’s going to continue. It’s not like the CAPEX is going to double, unless I’m interpreting this wrong; and even if it did it seems like you’d still be able to generate free cash. I’m just wondering what is the rationale here for keeping even $1 billion of additional liquidity? Is it conceivable in any scenario that you would be burning cash at this point given what your cost structure is?

Well, I would tell you, Rod, first off on the $1 billion liquidity target, that’s not what is needed to run the business but we like to have excess cash as a demonstration of strength when we talk to customers, and to give them comfort that three years out or four years out that we will have the financial wherewithal under any circumstances to launch the program and maintain the type of capital and cost structure we need to be competitive. That’s why we like it now. The real need is significantly less than that. And the second part of your question was is it conceivable? The only thing I can point to is what happened in the beginning part of ’09 when we went dark. Last year we did 8.5 million units in total but the first half was on a run rate that was significantly less than that and we had a modest cash burn. So never say never; I mean it’s not inconceivable that we would have a quarter where we’d go negative in cash if there was a market dislocation, a significant market dislocation. All in all though I see things pretty consistently with you. Rod Lesh – Deutsche Bank: Okay. Can you clarify for us what the FX impact was on your revenue and EBIDTA in the quarter, and then lastly can you just give us a little bit more help on this walk for the Q4? What are you seeing? You didn’t want to comment on platform mix for next year, but can you tell us what you see for platform mix looking into the Q4 and maybe the T-900 production?

Yeah, FX, first off, the easier part of the question is FX caused about an $80 million negative impact on revenue. And that was largely driven by the change in the Euro. You’re right, I don’t want to get a whole lot into ’11. I will tell you that CSM has the 900 down year over year from this year. It’s been a pretty strong build on the 900; right now, I don’t know – CSM is calling that at roughly 950, and next year they’ve got that platform coming down about 100,000 units thereabouts, Rod. Rod Lesh – Deutsche Bank: Okay, so you’re anticipating some negative platform mix in the Q4 on a year over year basis.

Yeah, slightly but not incredibly. But last Q4 was a very strong, 2009 Q4 was a very strong build for us with our platforms. Rod Lesh – Deutsche Bank: Thank you.

You’re welcome.

Your next question comes from the line of John Murphy with Bank of America/Merrill Lynch. Your line is open. John Murphy – Bank of America/Merrill Lynch: Good morning, guys. I was just wondering if you could comment a little bit on quoting activity. I mean there was sort of a log jam in the last two years when some automakers were looking a little bit frozen. I was just wondering if you’re seeing that picking up in general, and also really sort of how this relationship is developing. I mean is anything changing in pricing as you’re quoting on new business, or is it sort of similar to the way it’s been historically? I mean has anything changed there, is it a little bit more accommodating on any pricing actions?

I don’t want to surprise you with my answer but the customers are being really flexible now. They’re always asking for higher prices, just kidding around. But no, the quoting activity has picked up, there are new programs, a lot of new programs. There’s a lot of activity globally. Lear’s participating in every market in the world. Actually, we’ve got a lot of opportunity in Asia where we’re focusing our efforts. But no, the customers haven’t changed their pricing philosophy. They’re always looking for ways to get costs out of things. That’s normal business practice. I think we know how to operate in this market and we’ll be successful, and I think we’ll win the lion’s share of what’s out there. So I feel really good about the future. I don’t feel real good about my future, but I feel real good about that future. John Murphy – Bank of America/Merrill Lynch: I think it’s looking pretty good. Just looking at the schedules you’re seeing in the near term versus some of the estimates that are out there for the Q4, I mean it sounds like things may still be running a little bit better than expectations in the near term. And we’ve seen this happen for the last couple quarters where the actual production numbers for the industry have been higher than expectations for the beginning of the quarter. Is there anything you’re seeing in your near-term order rates from your customers that would indicate that the production in the Q4 might be better or worse than what’s generally expected right now?

The releases are strong right now, Murph, but they’re holding pretty consistent with how we’re guiding right now. Could they step up? Yeah, I think a lot’s going to depend on what we see in the SAR over the next October, November, and they could step it up then heading into next year. So from our standpoint we’re fairly consistent. The releases are strong and we’ll just keep an eye on it. John Murphy – Bank of America/Merrill Lynch: Great, thank you very much guys.

You’re welcome.

Your next question comes from the line of Brian Johnson with Barclays Capital. Your line is open. Brian Johnson – Barclays Capital: Yeah, if you could maybe talk about some of the competitive dynamics, especially between North America, Europe and China in the Seating business, what that means for sequential profit margins going forward. Is the European business in particular developing better margins or still a bit of a detraction from the US business?

Yeah, I think from our standpoint when we talked about it in the past, really the margins are driven more than anything by the level of content on a vehicle and our level of vertical integration, which we have a higher percentage of both in North America, both in content and vertical integration. So that always kind of supports a slightly higher margin rate. We’ve talked about Asia being consistent with our overall margin rate and target for the business segment. In Europe, because of the lower content on average and less vertical integration, more direct, it being a little bit lower. We are seeing European margins improve and step up from the low levels of around 3% before and they’re stepping up higher. We expect them to continue to improve.

But the reason is because we’ve got more vertical integration.

Right, absolutely. And-

The more you vertically integrate, the higher your margins,

We’ve had a lot of investment Brian, you know, fixing our footprint, also expanding our capacity and components, whether it’s seat trim, seat covers in Northern Africa or Eastern Europe, to our mechanisms facilities that we’ve opened along Eastern Europe, and that’s providing dividends for us. Brian Johnson – Barclays Capital: So as we think about sequential margins in Seating, on a year over year basis on a positive it was plus 10% which is a bit lower than you’ve talked about. Quarter over quarter, of course you had seasonality – it was down 22%. What kind of range should we be thinking about and how does the sequential or year over year changes in the various regions effect that sequential margin?

Well, there’s literally thousands of inputs into the margins, and we focus a lot on the industry dynamics but the reality is we sell to specific car lines in the industry. Each has its own financial DNA, which I’m sure we all understand. From our standpoint we’re pretty comfortable being in the range of 7% to 8% in the Seating margins. We’ll be solidly in the 7%, expect to be solidly in the 7% margin heading into next year. Brian Johnson – Barclays Capital: Okay, thanks.

You’re welcome.

Your next question comes from the line of Itay Michaeli with Citi. Your line is open.

Great, thanks. Good morning. Maybe as somewhat of a follow up to that question, so the 2010 guidance, the revenue’s up $700 million, EBIDTA up $100 million, that’s about 14% which is at the low end of your historical experience. Is that some of that mix playing in or are there incremental launch costs and other headwinds implied there as well?

Yeah, it is the mix. It’s not all real high margin business. There’s also FX that factors into that number, but there’s also been a significant increase in our sales backlog which drives development costs, launch costs and what have you. So from our standpoint again, it’s literally thousands of different inputs that come in here. We don’t sell to the industry; we sell to specific car lines. Each car line has its own financial DNA and stuff like that. So all in all we’re pretty comfortable with the performance of the business. It’s running very well and I believe we’re converting at a nice clip with our incremental revenues.

That’s helpful. And then Matt, can you maybe update us on how you’re thinking about restructuring in the next couple of years. You typically give us a bit of a scale there for ’11 and ’12 for cash restructuring. And also what the magnitude of annual restructuring savings might look like.

I will tell you that what we’ve got it to is roughly $110 million this year and $110 million next year. Some of the cash actions, because they’re becoming back loaded, the actions are becoming back loaded this year, will drip into next year. We started out the year talking about a cash impact of roughly $150 million for 2010. That’s down a little bit now. Now that cash is going to slide into next year. So from our standpoint, what I’m seeing for the next two years is an average of about $110 million for this year and next year. Again, some of those actions may slip into next year so you’ve got to kind of look at it in a 24 month bundle. Cash from that standpoint will be probably balanced at about $125 million or $135 million for each of the two years, okay? Then we’ll see them go down to what we call normalized. So we’re still on a somewhat accelerated pace over the next 18 months, then we’ll bring it back down to a normalized type, $40 million-type range, which is what we believe is normalized for this business and for this company in 2012.

That’s helpful. And then lastly, can you maybe update us on the profitability of the unconsolidated joint ventures, particularly IAC and some of your other ventures?

Yeah. We have roughly 16 unconsolidated joint ventures; roughly nine of them are in Asia, and we also have them in North America and in Europe – the biggest of which is IAC. We’re pretty much profitable in all our joint ventures in Asia, our non-consolidated joint ventures in Asia. From our standpoint, IAC is profitable. They returned to profitability both as a combination of the industry recovering and a lot of the restructuring actions that we have. Now, we have a 30% interest in the European joint venture and a 19% interest in North America. We’re very happy that they returned to profitability. We believe that the results can improve further as they continue to implement their strategic business plan, and as you see an industry and production in those two mature markets return to more historical levels.

That’s great, thank you.

Your next question comes from the line of Colin Langan with UBS. Your line is open.

Thank you. Guys, just a quick follow up on the restructuring. What was the difference between the $110 million per year and the $125 million to $135 million costs? Is the $110 million the savings?

No, what it is, and I didn’t talk about the savings – I will in a minute. The difference is the expense, Colin, versus the cash. Many times we’ll recognize the expense in advance of the cash, and the cash is kind of a follow up wave a little bit. So a lot of times there’s a disconnect between the expense and the cash; it’s just the timing of recognition versus when the actual cash outflow goes. From a savings standpoint, we’ve talked about savings in a 2.5 year type payout. We’ve run a little bit better than that historically, but we believe as we get into some of these longer and tougher to implement actions that it’ll approach more of a 2.5 year payback. I’d model anywhere from $75 million to $100 million of savings on an annualized basis for this year and next.

Okay, that’s very helpful. Can you also comment on commodity costs? Were they a headwind this quarter and are they going to be a headwind going forward? Also could you just update us on whether you’re getting more protection in your contracts for commodities if that’s possible?

Okay. Yeah, they’re starting to be a headwind mainly in copper at this point. Now, just to kind of refresh where we’re at on commodities, we did incur additional costs in the quarter and we expect a little bit more in the Q4. The two major commodities that we use in our products are steel and copper. In steel, we have roughly 2.8 billion pounds of steel in our seats; roughly 250 million pounds, though, are the raw steel that we convert into components. The rest of it is really through purchased components, of which about 1.4 billion pounds are used in components that we buy. The rest are directed by our customers mainly in Europe. Now they’re directed by the customer, we believe there’s a level of price indexing and protection just because that’s a negotiation between the customer and the supplier. On the components that we buy, we have certain type agreements, anything from price indexing to fixed annual requirement contracts and what have you, and it provides a bit of a buffer on the pass through. And every year we renegotiate and we look for ways to overcome any price increases that our suppliers are incurring or cost increases that they’re incurring on the raw stock. We do that through consolidation of buy and other metrics and value engineering that are able to help us offset that impact. Now steel is running at about $0.38 a pound. It’s pretty close to the recent historical history if you take away the spike to $0.60 a couple years ago. Copper, at this level of production we’ll use anywhere from 90 million to 100 million pounds of copper a year. We use it in our wire harnesses, in our junction boxes, and components, connectors. On the harnesses themselves, about 80% of the copper we buy is used in harnesses and those have historical price indexing arrangements with our customer. We have seen a spike in copper recently – it’s been, in the quarter it was around $3.50, up about a buck year over year, and we’re seeing it now spike at times up to about $3.80. That’s where we’re incurring the majority of our commodity costs right now. We believe it’s manageable and we will continue to work to find offsets for it. But that’s probably the biggest driver right now on the commodity headwind.

And also leather’s gone up.

Right. Bob mentioned, we’re one of the biggest hide buyers in the world and we’re up about $0.40 on hides.

So you guys get back to eating chicken.

For the copper side, 80% is the sort of price index. But it’s only 20% of that 90 million to 100 million pounds a year that is, is that actual exposure.

Correct.

Okay. And just one last question. On the tax rate, I mean you’re currently paying cash taxes. Any time in the foreseeable future where you’ll have to start accruing taxes at a normal rate since you’ve had some consistent progress?

Well, I have one of the smartest tax guys in the industry, here.

Don’t say that. Somebody’s going to try to hire him. Bill, don’t answer that.

Our Vice President of Tax here, Bill McLaughlin.

Yeah, really we would probably get back to a normalized tax rate once the valuation analysis in the US is eliminated, and right now we see that probably in the latter part of 2012. So then 2013 would be the first year where we would be back to a normalized tax rate. Colin Langan – UBS: Okay, great. Thank you very much.

Your final question comes from the line of Bret Hoselton with KeyBanc. Your line is open.

Hey Bret, before you talk, I misspoke myself. Don’t eat chicken – eat more beef. If you eat more beef we get more hides. More hides, lower price.

Correct.

Go ahead, Bret. Bret Hoselton – Keybanc Capital Markets: Thank you gentlemen, good morning. Seating margins, you feel pretty comfortable that you’re going to be in that 7% to 8% range over the longer term. You’re already there; that sounds somewhat reasonable here. On the Electronic side, I think you said that you think you can get up into that comparable margin range, into that 7% to 8% level. I think I understand some of the underlying reasons for that. What I’m wondering is can you kind of give us a sense of what your expectations are for the progression of that improvement? Is that a six month timeframe, one year timeframe, two year timeframe before you push off into that level?

Yeah, good question, Bret. From our standpoint really the key to the Electrical business returning to more historical margin levels of 7% to 8% is really getting the scale back into that business, because it has a fairly high level of fixed costs for the level of sales that it has. Last year, at $2 billion in revenue we had fixed costs of roughly 25% in that business, and that’s part of the cost of being in every continent in the world and also having the capabilities both in high-powered and low-powered, which has driven our infrastructure costs up. That however has also provided opportunity to grow our sales. The backlog that we announced last quarter had a significant portion, roughly $900 million of it, being in Electrical Power Management. We believe that the sales in this segment need to get to about $4 billion before we’ll start seeing the margins in the target range. That being said, through industry recovery, the backlog, continuing to penetrate and win new business in that segment, that we can get there in a three year timeframe. In the near-term we will see continued improvements in the margin in this segment. I don’t see any reason why next year for instance we couldn’t perform at a rate consistent with what we saw in the first half of this year where margins were 5%. Bret Hoselton – Keybanc Capital Markets: And then longer-term, as you think out beyond that two-year, three-year timeframe, given the high fixed costs structure and so forth, given the potential for leverage here and so forth, is it possible that the Electrical margins could actually exceed the seating margins in your opinion? Or do you think just comparable margins is kind of the longer-term norm for both the Seating and the Electrical?

I think it can stay at 7%, 8%. Could it be higher? Possibly – it depends on the mix of the business. Harnesses have, water harnesses have the same kind of capital intensity that a seat does and the same kind of engineering up front expenditures as seats do, and to get the right return on invested capital you don’t need to post margins in excess of 7%. The Electronics portion of our business is consistent with the mechanisms that we invest in, a lot of up front engineering and some capital, and it requires a slightly higher return. So it’ll depend largely, Bret, on the mix of the product within the segment. All in all we’re pretty comfortable that the margins will remain in that 7% to 8% range, and at that rate we’ll return a nice, we’ll have a nice return on investment for our shareholders. Bret Hoselton – Keybanc Capital Markets: Very good. Thank you very much, Matt. Thank you gentlemen.

Thanks. Anyways, I think at the end I’ll thank everybody for being on the call. I want to thank you, Matt, very well done and the whole finance team that’s here did an excellent job. I also want to thank every single employee in the company for the great job that you do. This is absolutely a great company and we have a great team of people all throughout the company. So I want to thank you all for what you’ve done and what you’re going to do. Thank you very much.

Ladies and gentlemen, this concludes today’s conference call. You may now disconnect.