Good morning, and welcome to PACCAR's Fourth Quarter 2013 Earnings Conference Call. [Operator Instructions] Today's call is being recorded, and if anyone has an objection, they should disconnect at this time. I would now like to introduce Mr. Robin Easton, PACCAR's Treasurer. Mr. Easton, please go ahead.

Good morning. We would like to welcome those listening by phone and those on the webcast. My name is Robin Easton, Treasurer of PACCAR. And joining me this morning are Mark Pigott, Chairman and Chief Executive Officer; Ron Armstrong, President; Bob Christensen, Chief Financial Officer and Executive Vice President; and Michael Barkley, Vice President, Controller. [Operator Instructions] Certain information presented today will be forward-looking and involve risks and uncertainties, including general economic and competitive conditions that may affect expected results. I would now like to introduce Mark Pigott.

Good morning. It's a pleasure to share that in 2013, PACCAR achieved record annual revenues and earned our third best annual net income. For the year, PACCAR reported record revenues of $17.1 billion. Net income was $1.170 billion, an increase of 5% versus a year ago. 2013 was PACCAR's 75th consecutive year of earning a net income. Having been at the helm of this great company for each of the top 10 years for revenue and net income, I can say that each year has its own unique path. What is consistent is the quality and determination of our 22,000 employees, who delivered industry-leading products and services to our customers every day. PACCAR reported strong revenues and net income for the fourth quarter of 2013. PACCAR's fourth quarter sales and Financial Services revenue were $4.6 billion, and quarterly net income was $334 million and after-tax return on revenues of 7.3%. This was the best quarterly net income since the first quarter of 2007. Net income increased 32% compared to results generated in the fourth quarter last year. Positive contribution of all the company segments enables PACCAR to attain the highest operating margins in our industry and to deliver excellent shareholder returns while investing during all phases of the business cycle. PACCAR declared cash dividends of $1.70 per share last year, an 8% increase compared to 2012. PACCAR's total return to shareholders was 34.9% last year, and stockholder equity at year-end was a record $6.6 billion. PACCAR delivered 36,400 trucks during the fourth quarter, a 3% increase versus the third quarter. The improvement reflects increased European truck deliveries as customers purchased trucks ahead of the January 1, 2014 implementation of the Euro 6 regulations. PACCAR began production of many new vocational vehicles in the fourth quarter, the Peterbilt Model 567, the…

[Operator Instructions] Your first question comes from the line of Jamie Cook from Crédit Suisse. Jamie L. Cook - Crédit Suisse AG, Research Division: Just a couple of questions. Just, one, you talked about deliveries, I think, being up 5% in the first quarter. Can you talk about what you expect the mix is versus -- U.S. versus Europe? And then, I guess, also any color you're seeing in order trends in Europe as we look to January, given the strong pre-buy that we had. And then my last question, how are you thinking about the ability to improve margins in 2014 over '13, given your retail sales forecast?

Okay. Let's start with margins. We think margins for the first quarter will be comparable to about a year ago. Jamie L. Cook - Crédit Suisse AG, Research Division: Is that on gross or operating?

Gross.

Gross margins. And in terms of production, first quarter versus fourth quarter probably will be down about 10%, and most of that is in Europe. But as I say year-on-year, production will be up about 5%, so we're pleased with that. And as the year goes on, we look for some steady improvement in the margin side. All of Kenworth, Peterbilt, DAF are all doing a very good job, and all the new products that we've been working on for the last 3, 4 years seem to be met with very strong market reception. Customers like it. They're delivering all the attributes we wanted. And I think when we will look at things like record market share at DAF it's a very positive signal for the company. Jamie L. Cook - Crédit Suisse AG, Research Division: I guess, just last question, how do you feel about your ability to pass through -- fully pass through the Euro 6 cost? And is that margin accretive? Is the margin dilutive?

Initially, I think we've been able to do it reasonably well. And, obviously, that's our goal, and it's been our goal every year or 2 as we have new environmental regulations to comply with. So that's certainly something that I think we're becoming quite proficient at incorporating into our designs and working with our dealers to pass through most of that additional cost.

Your next question comes from the line of Stephen Volkmann from Jefferies.

Wondering if I can switch over to Brazil. And I know you mentioned that you sort of see gradually improving production rates down there. I guess, I'm just trying to sort of maybe get a little bit sharper pencil on that. Really, what I'm trying to get at is thinking about the impact on profitability in 2014. I assume it's a drag, as it was in '13, but less of a drag. And I don't know -- as we end the year, is that business breakeven? Or is that too optimistic?

Well, the good news is we're doubling production in a week or so from 1 truck to 2 trucks a day. That's always positive.

Can you do that every day?

If you've got the magic wand, we'd be interested. So that's -- it's going well. Obviously, it's a multiple-year program as we gradually ramp up production, but we're encouraged during the early days. And I think as we get towards the end of the year, certainly, we hope to be at least breakeven at the facility. So I think your analysis is accurate.

Okay, great. And then, I guess, just back on Europe for a second and then I'll pass it on. The registration data in Europe was huge in December, much bigger than what your revenues might suggest. And, I guess, I'm trying to figure out just how this whole cadence worked. Was there some inventory build that happened and then things got registered out of inventory in the fourth quarter? Or -- it doesn't look like your market share changed in any negative way. I think it was actually up a little bit, so...

Our market share is a record. In fact, we've got very strong market share in the fourth quarter and in December for DAF, over 17%. And so we're very, very pleased with that.

So did you sell a bunch out of inventory in the fourth quarter?

Well, we -- the pre-buy started in the third quarter, and inventories increased at the end of the third and during the fourth. But as we got to the end of the fourth, a lot of those trucks started to be delivered to customers, registered, and so we finished very strongly.

I got it. And then is there some delivery potential in the first quarter that's still sort of Euro 5? Or was it sort of a hard stop on January 1?

Yes. That's a good question. Really, as we look through this year, we probably have about 20% of our production will be Euro 5, primarily for markets outside of Western Europe. So that will be ongoing for a number of years.

Your next question comes from the line of Andy Casey from Wells Fargo Securities.

A couple of questions, mostly, surprisingly around Europe. Earlier in the week, different manufacturers talked about a difficult pricing environment. Are you seeing that?

No. I think the pricing environment is pretty steady. If anything, it might be a little bit better. I'm not sure who you're talking about. We've increased share. Some of our competitors might have lost a little bit of share, which might have some impact on them. But our products are very well-received. We're having a lot of great truck shows. The dealers are excited about it. And our goal is to continue to have the best products in the industry and gain a little bit of share every year. So we're -- pricing is reasonable.

Okay. It was a Scandinavian, soon-to-be German competitor. And then second, if memory serves, the U.K. had an earlier stop in terms of the Euro 6 transition, like September time frame. We're now a few months past there. Have you seen any improvement in the demand, given that the economy is doing pretty well?

Yes, the economy, they're talking about over 2% GDP growth, I think, for the U.K. this year, which should be very healthy. Yes, they had a slightly different program in the U.K., and as a result, we still are delivering some Euro 6 and Euro 5 vehicles in the U.K. They seem to be very upbeat in the U.K. right now, which is encouraging. I know even on the car side, they're going to be well over 2 million units for the car industry. So...

Have you seen a greater uptick in the Euro 6 appetite in the U.K. than other regions?

Yes, I think there -- U.K. is always pretty forward-thinking in terms of embracing the new products. So I think our share, once again, went up in the U.K. as a marketplace, and the dealers are -- have embraced all our new products. But everybody -- in all the regions that we operate, this is every couple of year program. So I think the industry, the customers, the dealers have been through it in the last 10 years 3x. So they know the drill.

Okay. And then switching over to U.S. and Canada. We've had, so far, kind of a muted cycle relative to the last 2, and we've had some recent volatility in the orders, 2 good months, 1 weaker relative month in between. How are you characterizing the cycle? I mean, is it...

I think we are on a steadily improving path. And a couple of reasons for that. First of all, in the fourth quarter, I'm talking about U.S. and Canada, the industry had a little over 70,000 orders, which is the best quarter since the first quarter of 2006. So that's quite a few years ago. Second, as you've seen, but just the macroeconomic data, the U.S. GDP growth in the fourth quarter was a little over 3%, which is good for all industries. And finally, as we talk with our customers, we just had our large dealer meetings, more and more fleets are saying they feel good about it. Construction is going to be -- home construction starts over 1 million, 16 million car production estimated this year. They're starting to say, "Let's start to replace our vehicles. We feel good about our own industry. We see our end customers are improving their business." So I think steadily improving path, positive. So we feel good about it.

Your next question comes from the line of Andrew Kaplowitz from Barclays.

Mark, can you talk about your Rest of World sales, your other sales? Those sales have continued to weaken a little bit sequentially. Do you think you are at the bottom in those markets now and you should actually start to grow again in '14? And maybe you could sort of parse out the regions for us and what you're seeing in the different regions.

Okay. We look at Rest of the World or -- we look at all these home markets. That's how we look at them. Russia continues to be a very strong growth story for us. And 3,900 units, primarily DAF and some Kenworth trucks in there, adding new dealers, very excited about that market. Taiwan, we're now the second largest market share in the sort of 16-tonne market, and that continues to grow. Mexico is down a little bit because of some, let's call it, economic changes that they're implementing, but we think that's starting to stabilize. Colombia, which is a very strong market for us for most of the last decade, has declined because they finished some major infrastructure projects. I think that's now probably at a stable platform, and hopefully, that will improve. Australia, actually, is improving again. It's been pretty good through all the last decade. So for us, we see that's a very important part of our business, and probably, we're -- we might be at the low point and look for some positive improvement there.

That's helpful, Mark. And then maybe if I could shift to PACCAR Parts. For the year, you had about 6% growth, but your fleet continues to get larger. You've talked about adding distribution centers. You've added them. We're going to see some growth here in the overall aftermarket. So can we see some acceleration in that business in '14? And should we see some margin improvement still? I mean, it's been good margins, but it has been improving. But could we see that continue?

Yes. Well, I'm very proud of the team at Parts, record total revenues, $2.8 billion, and as you've indicated, they continue to grow. We're looking for some growth again this year of, hopefully, at least 5%. We did add a number of the Parts distribution centers. Our largest one in Eindhoven opened up about a year ago. And we continue to examine. Do we need additional one? We have a new PDC in Brazil connected with the factories. That's starting to -- its operations. So they're all -- these Parts guys are always coming up with very innovative ideas that we still -- we have a record truck market out there in terms of number of vehicles, and they're doing a very good job of growing the business into other businesses, whether it's competitive brands or bus business, trailer business. So that's a big driver for us, at least 5% growth this year.

Your next question comes from the line of Ann Duignan from JPMorgan. Michael Shlisky - JP Morgan Chase & Co, Research Division: It's Mike Shlisky filling in for Ann. Kind of a 2-part question here on Brazil. Can you maybe share with us what market share of retail sales you expect to get by the end of the year in 2014? And then, I guess, part 2 of that would be, would production -- would the share of factory shipments be above retail for 2014, given the ramp here?

Yes. Our share -- it's early days, but 1% to 2%, I think, is a very reasonable target. And as soon as we get the orders in, we build them, we ship them, we sell them. So it's pretty quick process for us in Brazil.

Your next question comes from the line of Jerry Revich from Goldman Sachs.

Mark, a bit of an improvement in market share and financial position since '97, I think.

It's been a great company for 108 years, and it's just a great company going forward.

I'm wondering, Ron, if you could just talk about what are the biggest strategic priorities that you see for the business over the next 3 to 5 years. And obviously, we're building out the business in Brazil, but I'm wondering if you could just expand and talk about additional opportunities that you're evaluating.

Let me jump in on that. Probably, that'll be a great topic probably when I'm not actually in the seat. So let's kind of take that off-line.

Alright. Fair enough. Mark, for the Parts business, can you just talk about the trends that you're seeing in Europe? Obviously, everyone is focused on the pre-buy, but the underlying freight volumes have actually been really positive over the past couple of quarters. Are you seeing the same thing in your Parts business? And does that -- I guess, what does that mean for your expectations of production ramp over the course of the second quarter?

For Parts?

Sorry, for trucks. So if the Parts business is picking up steam, presumably, we could see orders picking up for new trucks once we get through the overhang.

Yes, Parts -- well, let's just start with Parts. But Parts in Europe is -- has done a very good job, and they said they've got some new infrastructure and new programs there. The dealers have completely embraced a lot of the new innovative program that they've introduced. So we're encouraged with Parts, and we think that'll have some growth this year. I think on the trucks side, everybody, the whole industry benefited from the pre-buy, and I think a number of the manufacturers are back to production levels that they were at about a year ago. And as Europe gets a positive GDP, we expect to gradually increase production.

And, Mark, in terms of the Parts performance of the quarter, was it stronger in Europe or in North America? Can you just give us some color?

It was pretty good all the way around, yes. Aren't they all? All the different areas made a good contribution.

And lastly, in the U.S., your trucking customers have had trouble pushing price increases or at least as anticipated in '13. I'm wondering if you could talk about what you're hearing from them about the pricing landscape for their business at this point as they set some of their annual contracts in the spring.

Yes, I think, basically, the customers are doing well. Some of them have seen profits down from a year ago. Some have seen them up. But I think, overall, as the U.S. and Canadian economies achieve some strong GDP growth, I think that will be good for our customers, and I think they're optimistic. They've been through some tough times, but over the last year or 2 or 3, things are improving. So you're starting to see some pretty good results from a wide range of industries, and most of them have some sort of trucking impact in terms of deliveries or shipments or whatever. So I think our customers are feeling pretty good.

Your next question comes from the line of Joel Tiss from Bank of Montreal.

It's a shame you don't have the pleasure of Navistar competing in Europe. I'm sure they'll find a way to ship those '05 engines all the way out until '17.

I'm not sure.

I wonder if -- since you sound like you're being a little more generous than usual on trying to help us out, can you help us understand some of the mix implications for 2014? Because everyone's asking about margins. I think this would help to clear it up, the growth rate of Parts relative to Europe, relative to the U.S. and what all those pieces do for the mix.

Well, I think the -- we're looking at, as I said, 5%-plus growth for Parts, and we expect to see that both in North America and in Europe. So I don't know what else I can really add in terms of that. Kenworth, Peterbilt, we're looking for steady growth in terms of increased production. DAF, we think we've covered in pretty much good detail. And we continue to have some growth outside of Western Europe, so that's encouraging. And to say we just launched a whole new range of vocational vehicles just in the last few months in Kenworth, Peterbilt and DAF, and I think the timing appears to be very good as the, let's call it, the construction markets, different applications are starting to see some improved economics. So we feel good about that also.

Is the faster Kenworth, Peterbilt growth relative to DAF good for margins?

Well, I think all of our truck groups have good margins. So we look to improve every one of our truck brands.

All right. It was worth a try. And then even -- I guess, your seat is still warm, so I want to ask if there's any chance to use the balance sheet a little more aggressively. But is there any updated thinking? Lots of companies have piled up the cash, and they're looking at other ways to deploy it. And I know you spent a lot of time building out engines, and you're building out Brazil and the rest of the planet. Are there any other things on the horizon?

No. We've had strong return to our shareholders, very important platform for our company versus, say, 108 years, and that will continue to be a main driver for PACCAR. And we've had steady growth in our quarterly dividend program. And when appropriate, we've had the special dividend. And I think our cash position is pretty much in line with where it's been for a number of years. And yes, as you say, we have invested a lot in many parts of the world, and I think that'll start to really generate some positive benefits for the company over the next few years.

Our next question comes from the line of Steven Fisher from UBS.

I just want to gauge your confidence in the 150,000 [ph] Brazil market forecast relative to your confidence in the growth of some of the other markets.

Last year, as you know, it's 149,000 [ph], and we said it's going to be comparable. We are increasing our production rates. As I mentioned, Brazil, certainly, has been in the news in the last few months about different macroeconomic policies. In terms of the effect on us, probably not that much because we're really just growing our business right now, people like the DAF products. Our dealers are investing and putting in new service locations throughout the country. Obviously, we track what's going on in a macro level, but we continue to invest in Brazil. And we look at this as a 50- to 100-year program, and we're excited about it.

More of your own company actions are going to be more impactful than what overall market is there, it sounds like.

Yes.

On the vocational side of the new products you launched, at what point would you have a view on the traction that those new products are gaining in the marketplace?

I think we're having already a positive view just in the last month or so, and it's certainly very early days. Certainly, on the dealer side, on the customer side, we're starting to get some orders, and the product seems to be doing very, very well and meeting the expectations of what our customers expect. It's a little bit wider cap and very fuel-efficient, very comfortable and seem to be just what the customers are -- have been looking for.

Your next question comes from the line of Rob Wertheimer from Vertical Research.

So just to expand on the comments earlier, you mentioned a little bit of a broadening recovery in the U.S. Construction across different types of machines had some pretty mixed results. What are your thoughts on whether you're actually starting to see a more sustained improvement in the construction, vocational, dumps, cement, all the different kinds of trucks serving the construction industry?

Well, I think 2 major ones. One would be home construction. The other one that's been in the news, obviously, is with natural gas. Looking at home construction, it's rebounding at a reasonable rate. Everything that goes into a house is brought by a truck. A lot of trucks are in that business, whether it's steel, brick, glass, sofas, white goods, whatever. So that -- I think that is very encouraging on the natural gas exploration. That's -- I think it's been pretty stable to a little bit lower in the last year or 2. But I think home construction is very strong. And then on the cars, 16 million cars, trucks play a very important part of that. And moving componentry to factories, completed goods from factories to dealerships. So we're encouraged by that also.

Okay. Let me ask you a different question. Just you had a little bit of a pulse on the R&D with all the emissions, and you did seemingly a very, very successful launch [indiscernible] with the penetration-type [indiscernible] and everything. So really, really successful. And then R&D is coming down a little bit as a result. Do you think that this is sort of a temporary down and you've got a couple of ways of investment to come as more -- I mean, there's a little bit less tightness on the emission. There's always fuel economy. Or do you think that -- or that was the pulse before and we're at a new level at this point relative to sales?

You're talking about the R&D expenditures?

Yes. That's right.

I think R&D -- we've had so many wonderful products and projects underway in the last 5-plus years, as we always do. We have a lot of programs going on right now. I think R&D might be a little bit lower this year than last year. As you say, we've concluded a lot of these programs. They're doing well and maybe a little bit lower for next year or so but still at a very steady rate.

Your next question comes from the line of J. B. Groh from D.A. Davidson. J. B. Groh - D.A. Davidson & Co., Research Division: I just had a question on -- I mean, you may have addressed this, but I apologize if you did. Can you give the penetration of the PACCAR engines in North America currently and sort of what your goals are there?

We did in sort of high-30%, 37%, 38%, and our goal is to keep growing it. I think as we look at the entire industry of last year for North America, as we mentioned this in the last year or so, the 13-liter, which is the engine that we have -- of course, we just introduced a new 11-liter for Europe, soon to be in North America. But 13-liter is about 50% of the market, and the 15-liter is about 50%. So that seems to be holding very true. And we think that the 13-liter will continue to grow, so we feel good about it. And we've now manufactured over 50,000 engines at our Mississippi factory, and it's doing well on the launch. J. B. Groh - D.A. Davidson & Co., Research Division: Good. And maybe one for Bob. Could you address what happened with that provision in Financial Services in the quarter? Is that just a true-up for the year? How did that work?

Yes, it really reflects just the timing of some recoveries on some previous charge-offs that we've had.

Your next question comes from the line of Seth Weber from RBC Capital Markets.

Going back to a question about your customers, fleet utilization is running very, very high. It's in the high-90% range. I mean, do you have a view of what the upward limit of that is? And do you get the sense that your customers are pushing that higher relative to prior cycles?

Well, yes. I think you're correct, it's probably mid-90s, low- to mid-90s. Sometimes it's a little hard to actually get an accurate number on fleet utilization. It's certainly higher than it's been because we've been through some challenging times. But starting a few years ago, I think fleets have focused on their improved fleet utilization. Obviously, there is an upper limit. It's hard to get more than 100%, but -- basic math. But -- and I think that's one of the positive drivers for our industry in terms of orders. And as I mentioned, fourth quarter was 70,000 units for the industry. That -- you get to mid-90s, and for a customer to grow, you've got to probably take on additional trucks. So I think that's another positive factor in our industry this year.

Okay. Maybe just separately on the smaller fleet, smaller customer, smaller fleet side, are you seeing anything with more available financing? And, obviously, PACCAR Financial or just across the industry, have you been noticing any loosening up towards the smaller operators?

I think there's pretty good financing available out there. Certainly, we've got a great program with PACCAR Financial. Then we have our leasing arm, which is doing pretty well and achieving strong results. And then we see a few more banks coming back into the business. As the economy improves, everybody wants to get back into it. So I think for the small to medium to large fleets, there's certainly good availability for financing.

Your next question comes from the line of Adam Uhlman from Cleveland Research.

Sticking with the engine team a bit, you sold 50,000 units in North America. It seems that some those are starting to come into the warranty, out of warranty coverage. I'm just wondering if that is a bigger factor in 2014 than it was in 2013 for the Parts business.

No. It's a good question, but I don't think it really has any impact. No. We're still probably a little ways away from sort of the positive impact on maybe parts and service side of it, still really growing our population of engines is the way I'd look at it.

Okay, got it. And then could you guys comment on the impact of currency to the quarter for revenue and earnings?

Yes.

Yes, sure. The impact on earnings was about $12 million, and the impact on revenues was about $80 million, positive.

Your next question comes from the line of Jeff Kauffman from Buckingham Research.

I wanted to dive a little bit deeper into the currency question, Bob and Robin, if I can. You said it was $12 million positive to earnings in the quarter. Could you differentiate that, say, your euro exposure versus your real exposure? And then talk about, given the big moves we've seen in the currency markets, particularly emerging markets, how could this impact 2014 just based on your outlook?

Well, the impact on the quarter -- that $12 million is a pretax number, just to clarify. And the impact was mostly from the movement of the euro. And currently, our revenue stream from Brazil is low enough that it's not going to have a big impact on us, the movements of the real.

And then looking toward the year, you would say no real real impact as you're ramping up Brazil?

Correct.

No.

Okay. And then I was just kind of thinking about cash. You mentioned, Mark, that maybe this year is an off year for R&D, but normally, relative to your revenues, the spending is a little higher. Is this more of a respite for a year and then the spending picks up a little? Or do you think this is a good run rate for R&D for you right now?

Well, I think right now, it's probably a reasonable run rate, and then in a year or 2, you get into, call it, early midlife updates on the vehicles. There's always engine work going on and continue to look at enhancements to our facility but I think reasonable run rate right now.

Okay. And final question. I'm sure this is something you'll hit at the truck show in March. What are the 1 or 2 new products that excite you most as you head into 2014?

I think as I mentioned earlier, the timing for Kenworth, Peterbilt and DAF to come out with their new vocational vehicles seems to be -- it looks like we have some great sales and marketing guys. I think they really hit the timing perfectly with these new products coming out. And the MX-11, I think that's going to be a big win for PACCAR for -- once again, for all of our truck guys around the world.

Your next question comes from the line of Tim Denoyer from KSA Capital.

I had a couple of quick cash flow questions for you. I'm wondering if you can help me understand the cash flow -- operating cash coming from the manufacturing operations. I know you don't break it out that way, but if we look at the $2.4 billion of total operating cash flow and take out the $300 million of finance income, $600 million of equipment depreciation and it looks like you usually have about $200 million of residual value and deferred revenue, are there any other big factors to consider when just trying to get out the manufacturing operating cash flow?

Excellent question. No, I mean, that's -- you've hit most of the main segments.

Okay. Great. And then one other cash flow question. I noticed that you didn't buy back any stock in 2013 after buying back about $500 million in '11 and '12. Could you talk about why not? Obviously, you're still in a very healthy cash position to just not financially viable [ph].

We continue to evaluate it, and we do have authorization, as it makes sense to do it. Right now, we're -- we've been investing in new products and engines and factories and distribution centers. But certainly, an ongoing strategic road for us.

Great. Okay. And if I could throw just one more in. You talked about the success of your own -- of your natural gas products. Can you talk about whether or not you would consider taking some of your PACCAR engines and using -- and putting -- switching those over to natural gas?

Absolutely. Yes. No, it's -- we got great engines and it's something that is always being evaluated.

Is there any time frame?

No time frame at this time.

Your next question comes from the line of Scott Group from Wolfe Research.

So, Mark, you mentioned a couple of times about the strong order momentum in fourth quarter. Can you give us a view on kind of what you're expecting for first quarter order momentum? So certainly, the truckers are seeing tighter capacity and rates starting to move up. Do you feel like there's any improving momentum on first quarter orders? And I know it's early, but the range of 210,000 to 240,000 for '14 is kind of wide. Do you have a view towards the upper or lower end of that range at this point?

Well, I think as we're here in the last day of January, I think we'll stay with that range. But I think your analysis is correct, and we look forward to updating you in a few months. And I can say we've got an important truck show coming up in probably about 6 weeks. We'll get a better flavor then. But it looks encouraging, I'll just put it that way.

Okay. And then just a follow-up on that last nat gas question. What do you -- what price do you think nat gas needs to be for that to be a competitive option? Is it losing some competitiveness with gas at $5 right now, nat gas at $5?

Excellent question. I think we've got [ph] probably a little more time than we might have on this call because it's -- I think the price of natural gas, the price differential to diesel is just one component of that equation. The other ones have certainly been discussed and debated and reviewed, and that is the infrastructure, the benefit and the effects of the improving diesel engines. So the way we look at it is that we're very pleased to have a strong share of the natural gas market. It's still in that 1% to 2% range for the total industry as it grows, and we expect it will grow over time. We will look to grow our own business with it. And so that's a broad, broad discussion that probably we don't have time to do right now.

Yes. Just one follow-up on that point. Where do you see the spread right now and the cost of the truck for diesel versus nat gas? And has that started to come in yet?

One more time with that question.

The spread -- the difference between the cost of buying a diesel truck versus nat gas truck right now. And is that coming in?

Yes, I think that cost is declining as we are getting a little bit more volume of installing natural gas onto our trucks, our chassis. And some of the suppliers are gearing up to improve the efficiency of making some of the componentry. So I think, over time, that spread will decline, will decrease.

Your next question comes from the line of Brian Sponheimer from Gabelli & Company.

A question for you on just kind of from a directional perspective. I've seen you use prices on some of your trucks over the course of, let's say, the last 9 -- 3, 6 and 9 months. I guess I'll take it from there.

Used trucks, really, both in North America and Europe, our brands continue to maintain their strong position relative to the competition, and it's been really steady over the last year.

So I'd say a truck coming off of a program in December, would you be getting the same price for that truck in December that, say, you would have gotten in April or May of this past year?

Yes. Yes, we would.

Your next question comes from the line of Tim Robinson from Susquehanna.

I was just wondering if you could give us an update on the investments you're making in the enhanced powertrain development, maybe give us a sense for the timetable.

We're working on the SuperTruck project with the government and Cummins, and that's exciting. And we're just looking at the whole, let's call it, powertrain componentry and what we can do, either working with our suppliers or working independently on continuing to enhance and make it more efficient. So I think that's about all we really can talk about.

Got it. And then lastly, Parts, the margins were great all year, and it looks like there was a bit a tail-off in 4Q. I'm just wondering, is there seasonality in that business that we should be aware of? Or what drove the sequential decline there?

There's really not that much. I mean, I would say each quarter has its own season, but we look to ramp up each quarter, depending on that season. So that really is not a factor. I think there was just a lot of Parts business in the fourth quarter, and I think they did a great job of handling it. So I don't think there's much to read into that.

There are no other questions in the queue at this time. Are there any additional remarks from the company?

I'd like to thank everyone for their excellent questions. Thank you, operator.

Ladies and gentlemen, this concludes PACCAR's earnings call. Thank you for your participating. You may now disconnect.