Good day everyone. Welcome to the Rush Enterprises, Inc. third quarter 2008 earnings conference call. Today’s call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Mr. Marvin Rush, Chairman of the Board. Please go ahead, sir.

Good morning and welcome to our third quarter 2008 earnings release conference call. On the call, with me today are Rusty Rush, President and Chief Executive Officer; Marty Naegelin, Executive Vice President; Steve Keller, Vice President and Chief Financial Officer; Jay Hazelwood, Controller; and Derrek Weaver, our Chief Now, Steve Keller would like to say a few words regarding our forward-looking statements.

Certain statements we will make today are considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Because these statements include risks and uncertainties, our actual results may differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include but are not limited to those discussed in our annual report on Form 10-K for the year ended December 31, 2007 and in our other filings with the Securities and Exchange Commission.

Now, we would like to give you an update on our progress. Let us talk about the third quarter results. In the third quarter, the Company’s revenues totaled approximately $414 million, a 20% decrease of revenues from $522 million reported in the same period last year. Net income for the quarter was $8 million or $0.21 per diluted share compared to $13.1 million or $0.34 per diluted share in last year’s third quarter. Third quarter 2008 business segment results, I will compare this with the third quarter of 2007. Let us talk about truck segment. Our truck segment recorded revenues of $392 million in the third quarter of ’08 compared to $409 million for the same period in ‘07. The Company delivered 1350 new heavy-duty trucks compared to 1820 in the third quarter of last year. Revenue for Class 8 trucks sales decreased approximately $61 million or 27% to $162 million. Revenues from medium-duty trucks sales decreased approximately $22 million or 28% to $54 million in the third quarter of 2008 with 919 new medium-duty trucks sales. Revenue from used trucks decreased $11 million or 21% to $42 million for the third quarter of ’08. The Company sold 936 used trucks in the third quarter of 2008 and 1032 used trucks in the same period ’07. As expected given this current lull to economic conditions about Class 8, and medium-duty trucks mortgage remain weak in the third quarter. Truck load carriers have been the most severely impacted. Construction related truck sales have also declined dramatically on the East and West Coast. Decline in these sales has been offset by some strong oil and gas markets in the central part of our dealership network. Our Class 4 through 7 truck sales remained consistent with the industry which was down 41% compared…

(Operator's instruction) Your next question comes from the line of Jamie Cook with Credit Suisse. Jamie Cook – Credit Suisse: Good morning. Congratulations on a tough market environment. Can you guys just really give us a feel or a little more color one on what you are hearing from your customers in terms of their ability to get credit or finance these trucks and then second comment on I think it was last quarter where you guys had to take a write down on used equipment. Can you comment on used equipment pricing and inventory levels for you guys at this point?

Sure, Jaime. Before the credit situation when it comes to retail credit and getting customers getting finance, obviously you have to realize that it is more difficult in this environment. We fortunately, especially for our smaller customers who have taken up an approach and probably prepared for this fairly well and the fact that we have had to diversify where we lay credit off where we get retail credit financing so where we used to be historically probably tied to two sources more for 80% of our business, more than half of our business is now being sent out to other banks and other financial commercial institutions that are probably have not been caught up in the big bank credit crunch. There have been others more regionalized type banks, more local regionalized types stuff. So we have had a shift in where we place paper over the last 90 days and 120 days but we have been able to provide financing to the smaller customer. As far as the used truck inventory, our used truck inventory is in line, where we believe it should be and if you look at margins, they are back in line with historical margins in the 8% range. So, we feel really good about 8.8 I think. So, we feel really good about where we are at from the used truck perspective, we took that right down in the second quarter as we had to one time almost evaluation of second quarter and we are very comfortable we are on top of our used truck inventory and managing it accordingly going forward.

Your next question comes from the line of Andrew Obin – Merrill Lynch. Andrew Obin – Merrill Lynch: Yes, just a follow up on Jamie's question regarding financing, availability and residual values, have you seen any drastic changes in the past three weeks and I apologize if you have answered that already.

No, I did not answer that, thinking from a three-week perspective, Andrew but no I have not really seen I mean in the last three weeks. We saw it earlier in the year, obviously reflected in the second quarter but currently we believe we are on top of the used truck valuation; and as far as the rates go, no questions the rates are up but financing is available but it is obviously tiered to the stronger, I mean you got to have strong credit to get finance but rates are up so there is no question from where they were 60 days ago. Andrew Obin – Merrill Lynch: Are you guys seeing a change in players who will offer financing versus captive versus banks versus finance company and versus near-end terms? Could you describe and tell us what the landscape looks like now?

Alright, I tried to address that with Jamie's question but we have gone out and searched out more regionalized banks and other commercial institutions. I am not going to get caught up in names right at the moment but that is why there has been a shift. If you look at our last 60 days of financing, 60% of it has gone out to what I would tell you were historically a 20% piece of our business. So, okay we have had to obviously spread it around given the environment win.

(Operator's instruction) Your next question comes from the line of Chaz Jones – Morgan Keegan. Chaz Jones – Morgan Keegan & Company: I just wanted to ask quickly here on the outlook being relatively flat in 2009. Do you anticipate any market share shifts as it relates to the business? I think historically you have probably run 4% to 4.5% on the heavy duty side.

No, I really do not. I would believe, if you look at that, if you run a 4% number up a 140,000 Class 8 US retail, that is 5600 units. That is probably more or less in line with what I would project we are going to be this year in that range and where we are going to next year given the flat market now. As far as how the year spreads out, I believe that year is going to be down in the first half, 10% to 15% and up and the 15% in the second half of the year will be my best outlook as I look at it right now for 2009 deliveries. Obviously there is immediate truck availability across the board, I do not care which manufacturer you are dealing with. So, it is going to continue that way I believe through the first half of next year. You will get some slight up tick during the second half. It just depends on actually when it will start. There are a lot of things, we should talk about the credit, we should talk about the used truck values, we should talk about the replacement cycle will begin to catch up; we should talk about engine emission. So, that is why I believe the second half will be up some but offset by being down in the first half of the year. Also as one thing to remember, there has been fall out in the last few weeks as far as manufactures go so we might be able to pick up a little more market share that way but that is our job and it remains to be seen as we go into next year. Chaz Jones – Morgan Keegan & Company: Okay and then on the meeting, did you say, I know what multiple acquisitions that you guys have done over the last 24 months, remind me, is that market share around 2% if my memory serves me right?

Yes, I would say it is 2%, about 2 to 2 and a quarter in that range. As you know, it depends if you are looking to Class 4 to 7 or Class 5 to 7. It depends on how you want to break it out but yes, that is a good spot. Chaz Jones – Morgan Keegan & Company: Okay maybe just quickly on the hurricane, I know you guys obviously said that was tough to quantify but would it be fair to say that it probably had a bigger impact on the I guess the back end side of your business from a service standpoint?

Sure. No question it did. When you are running on generators for over two weeks and you do not even get those hooked up for the first six days, your customers are severely impacted. Everybody shut down in the streets and clean up and everything else but I have to tell you, I am very, very proud of our people. The efforts they put forth, I cannot begin to get on all of the stories on this call but just bringing their own generators, doing this and doing that, the effort put forth by our people in the Houston area and surrounding area was outstanding and obviously it had an adverse impact on our earnings but I do not want to quantify this. Chaz Jones – Morgan Keegan & Company: Yes, I understand. I just wanted to get a sense for may be is there a potential catch up impact in the fourth quarter or into that, just trying to be 2Q.

I am not probably getting a little bit 2Q that we will then describe as that. If you can remember the fourth quarter, it is historically the hardest absorption month. We are going in at winter time. I mean you got fewer working days, you have all the holidays and parks and service is dictated by how many working days and working hours you have to turn wrenches and sell parts. So, with the holidays, it is always a tougher quarter; November through February always the toughest months we deal with. The winter time from a backend perspective but I am very confident that we will continue to maintain our goals of matching that 105% absorption or right around that area. We always told you we thought we were there. We hope to be able to raise it faster than what we have over the last year and a half or so but on a difficult operating environment and through the efforts of a lot of people in the organization, there has been a lot of expense work because it has been tough to go to the top line but we have managed through it. That is what absorption is and there might have been dominated and I am very proud of where we are at. For the quarter we are 108.6 which puts us up a point for the year and that is outstanding and has not come from gross on the top line which is unfortunate but it has come to some great management on our part and you got to remember, if you look at same store G&A expenses, you breakout the Company but we will guess is one thing because that is obviously tied more to sales, more commission, more variable. The G&A portion of our Company from the third quarter last year to third quarter this year, is down 6.2% and down 5.6% year to date. That is the G&A fees. I mean that is what is allowed us to maintain the absorption rate there. Chaz Jones – Morgan Keegan & Company: Yes and clearly obviously very impressive absorption rate in the quarter and seasonally I know it is probably one of your better quarters. Have you guys taken another step further I guess in terms of maybe proactively identifying other leverage that you could pull on the cost side and if we can continue to kind of trend down here over the next six to nine months?

No, that is difficult Chaz. I mean customer service is number one. You have seen how Rush is going and the things that we carry and the beliefs that we have in our organization or how we go to market. The customer service is number one so you have to be very, very careful when dealing with those expenses that you do not impact the things that have gotten you to where you are at. So, I do not really want to answer that and say, "Yes, we can keep cut." I mean we will deal with the environment as it comes. Chaz Jones – Morgan Keegan & Company: I understood and then last thing here, I know you answered the question as it relates to inventory on the used truck side. I mean do you see any inventory adjustments I guess on the new side that are going to be material one way or the other in the coming quarters?

No, I would tell you we are probably flat with where we are going to be. I mean there could be little movement but we are about where we need to be. We could possibly use, it would be down a little bit from where we are up but not much, not materially Chaz.

Your next question comes from the line of Rhem Wood – Stephens Inc. Rhem Wood – Stephens Inc.: Good afternoon. Just a couple of questions, can you talk a little bit about how many of these alternative vehicles you are selling and the tax rates there? I know that it has kind of offset in the G&A line but could you just talk a little bit how many you are selling, how many you think you can sell?

Well, we are hitting it on a few different trucks. We are hitting it with the class 8 trucks especially out in the West Coast area that will accelerate as we go forward. There is no question, Rhem. So, on the bus business, the full time buses in taxes, though, there will be more of it but remember we are limited by AMT, alternative minimum tax rules so there is a limit as to how much of that tax we can pass on depending upon earnings and on tax laws, but it will accelerate some over the third quarter but I would not look for it to be, it is going to accelerate really in the next year. I will see more of it next year as we go forward, okay? I do not want to quantify it for you right now because we were working through it but you got to take the approach if that is truly a margin. It is not a tax savings. I do not want it to be snowed out this morning that was more credit, well let us say taxes. But we take a hit in the SG&A as you said just pass through those partial tax credits with municipalities and because of our size, it gives us an ability that a lot of dealers do not have because they cannot pass through a tax credit so it gives us an advantage when it comes to dealing with municipalities and we are excited about it and we believe it will accelerate going forward. We are working a lot of deals right now in that type of grain initiatives, that was a type of grain initiatives and I just cannot quantify it for you this moment. Rhem Wood – Stephens Inc.: Okay. And we get back to the financing for a minute, are you seeing any difference between the stuff that you guys are financing yourself and what is being the customers’ finance through other outside vendors?

Okay, Rhem, remember make sure you understand, we do not finance anything ourselves. Rhem Wood – Stephens Inc.: Right, you pass it on..

But if you are asking about large fleets that go out and acquire, no question that market is tight but there is credit there. It is just expensive right now given the volatility in the market. It is squeezed tight. Has it gotten tighter? Yes, it has gotten tighter but the rates are up across the board whether you are a small guy or a big guy right now. It does not matter. No matter what size of operator you are, you are effective but if your credit is good, you can get some in but I think those rates will, I hope it is starting and as LIBOR start to settle down in the last week or so. I was looking this morning and hopefully that will have an impact on some of those rates as we go forward, but I am not here to guarantee you anything but credit is available. It is not readily as available as it was but so your marginal players are really out of the credit market to be honest with you. That is where the issue is coming right now. Rhem Wood – Stephens Inc.: Okay thank and just if we could get back to the absorption ratio that is going to come down a little bit in the fourth quarter right but it has not exceed the 105% for the year.

We plan on it. That has been our goal all along. I mean basically it is a little tougher in the fourth but we are not through the fourth quarter yet so I do not put anything past our people..

Your next question comes from the line of Todd Maiden - BB&T Capital Markets. Todd Maiden - BB&T Capital Markets: Sorry if I missed it but I just hopped off another call. I heard you talking about inventory evaluations and it sounds like things have flattened out there, and ever since the drop we saw last quarter, is that the case?

Yes, that is the case. We are monitoring it very, very closely at all times. You have to, obviously when you freight for vehicles, you have to build a minimum freight and put a number on freight on used vehicle price. So, we have a shortened link from what we will give the numbers are good for going out. So, we can try to be on the top of the market this past weekend. We had very some sudden shift, we hope to be able to catch it on quicker than we did obviously the last time and we think we are going to best job we can and I think margins reflect that to normalize in the third quarter where historical margins, I think that is where we are at for that issue. Todd Maiden – BB&T Capital Markets: Alright, how long do you think it would take for you to work through your current used inventory?

Well, it takes less than the quarter given how much we have; we did not take anymore used grades, if we stop at doing business, we have got about 700 units and you saw what sales were over around 800 to 900 I think in the store in line right in front of me right now but they were 919 units that is to tell you pretty quickly how fast we could move through it if we stopped taking, but we are not going to stop taking freight. That is not the way things work. Todd Maiden – BB&T Capital Markets: Alright and then you are talking about the pricing a little bit from the OEMs, have you started to see that level or ease at all and then we saw some pretty big pass throughs there in Q2 and beyond that but has that started to ease at all?

I think there is some easing, yes, there is no question because the environment is supply and demand and when there is some not as much demand, supply gets cheaper so you could try to create a little demand so let us going on, it is a moving target really right now but I would not tell you it is trending up. Todd Maiden – BB&T Capital Markets: Right and what type of lag do you typically see there?

I am sorry lag… Todd Maiden – BB&T Capital Markets: From the time I guess in this past go around where commodity price is eased, I mean typically how long does that trickle through to you guys?

It usually takes probably 120 days or so but I would tell you, I think you are going to see because of demand being down. You have to; margins have to go down with it on all sides us included. It starts from the manufacturer to us. I mean our margins are down year over year I mean our Class 8 margins are down and that is probably reflective of the manufacturer's margins too at 1.8% from third quarter last year to third quarter this year margin. Todd Maiden – BB&T Capital Markets: Right and then the last thing, I know you are talking about revenue within the different truck types, I think the classes 5 through 7 it was $54 million in revenue for the quarter used was $42. What was Class 8?

Class 8 revenue for the quarter, give me one second, it was $162 million, $162.5.

Your next question comes from the line of Gerry Heffernan - Lord Abbett.

I was just wondering if you could review for us if you would the floor plan in financing. Who does that? What the status of that is and where you think that might be going and exactly if you could really quick just a real elementary run through of the dynamics of that and what would happen if the OEM manufacturer that you are getting the trucks through were to say “You know what if we need to put through some incentive program we need to cut the value of these trucks that are sitting on your floor?’

Okay, Gerry as far as the floor plan, we have a signed long-term agreement on floor plans so we are fairly comfortable. Everybody is in the case that you can look at in the queues so as far as where we have our floor plan, we are very comfortable. As we have mentioned in the release, we reviewed all that. We take floor plan, I think it is important. I must speak a little bit of the balance sheet really quick. It is important you got to understand about floor plans. We view floor plan as a trade payable and we take that out when we look to debt to cap because you buy a truck, you sell a truck, it comes on and off. It moves on and off, it is a constantly flowing so when you take that out like I said it is interest bearing trade payable, when you take that out, our debt to cap ratio is 33.7 which we are obviously very comfortable with. If you take a look at the equity, we got $418 million in networks of the Company of which tangible equity is $275 million with cash investments is $152 million of them, cash being $144 million. If you look at balance sheets everybody is scrutinizing them hard and trust me we have been managing ours as well as we know how. We have equity of $408 million to $418 million of equity. It is 40% equity to assets. So, if you take a look at where the stocks trade manage, trade right at tangible book value. So, those are some of things that we have been measuring and monitoring with. We have met with our providers. We talk to basically all our credit facilities and we are very comfortable with where we are at and we still believe as we said it we can get funding, rates are going to be a little higher at the moment we understand, but funding is available when it comes to real estate in these types of things right now. As far as the manufacture, if we would move, if they put past our huge incentives then it would move floor plan down. We would have in float but we do not see those types of, have not seen those types of huge incentives because usually they are towards the customer but not necessarily towards us. So, it happens at time of sale, not necessarily at time of purchase from our perspective. Does that help to answer what you were looking for?

Yes, it does. Thank you.

(Operator's instruction) It appears there are no further questions at this time so I will turn the call back over to management for closing or additional remarks.

Thanks, guys, for listening to us. If you got any questions, give us a call. We will talk to you one of these days.

Thanks everyone. We appreciate it, bye-bye.

That does conclude today’s conference. Thank you for your participation. You may disconnect at this time.