Good day and welcome to the Rush Enterprises, Inc. first quarter earnings release conference call. At this time, all participants are in a listen-only mode. Later we will conduct the question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder this conference call is being recorded. I would now like to introduce your host for today’s conference Marvin Rush, Chairman of the Board.

Welcome to our first quarter earnings release conference call. On the call with me today are Rusty Rush, President and CEO; Marty Naegelin, Executive Vice President; Steve Keller, Vice President and CFO; Jay Hazelwood, Controller of Rush Enterprises; Derrek Weaver, Vice President and General Counsel. Now, Steve Keller will say a few words regarding 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, 2009 and in our other filings with the Securities and Exchange Commission.

Let’s talk about our first quarter update. We believe 2010 will be another difficult year for truck sales, but we do see encouraging signs of recovery in general economy and specifically in our industry. Increased freight tonnage couple with diminishing excess truck capacity has resulted in a 10% in our truck centers part services and body shop revenues in the first quarter of 2010 compared to the fourth quarter 2009. This combined with continued expenses management resulted in our absorption rate increasing from 92.4% to 97% for the same period. We are optimistic of this increase in our part of services business in an early indicator that is sustainable recovery has begun and should accelerate throughout the year. The construction equipment market in the territory we serve in Southeast Texas continue to decline, industry wide unit was decreased 41% from the first quarter of 2010 from the same quarter year ago. As a result our new used construction equipment sale revenue decline $7 million in the first quarter of 2009 to $5.6 million in 2010. Let’s look at our outlook for 2010. While we believe we will continue to see improvement in the back ends of our business we also believe the 2010 will be another difficult year for truck sales. A majority of new trucks for pre-emission engine have been sold and the trucks with 2010 emission complaining engines are now beginning to reach the dealership loss. This new technology comes with a significant prices increase which will limit demand. As a result, we believe that the new heavy-duty and medium-duty truck sales remain sluggish in the second and third quarters of this year. In the meantime, we expect truck sales with pre-2010 engines to be in high demand. Looking forward, we expect strongly Freightliner truck sales in 2011, ’12 and ’13. The general economy, we believe that when the Class 8 truck market recovers, it will come back fast and strong due to the pent-up demand created by four consecutive years of below-normal replacement cycles. We’ve recently entered into an agreement to acquire certain assets of Lake City International, a dealer group for 11 locations in the Utah, Idaho and Oregon. This will provide us with significant entry into three Western states and expand our network up to 60 truck center. More importantly, it provides us an excellent platform will rush to build, it’s Navistar Division. We have had the pleasure of meeting with many of the employees of Lake City International and we look forward to welcoming them to our organization. Finally, our balance sheet is strong and company is well positioned to take advantage of acquisition opportunities. We are confident in our strategy and our ability to execute. Thanks to our employees, we’ve remain a financially strong and profitable company. We’re now prepared to answer any questions you may have.

(Operator Instructions) Your first question comes from Chaz Jones, Morgan Keegan.

Talking about the second and third quarters, you guys have said her for a couple of quarters that you expected that to probably weaker in the first quarter. Has that changed I guess and then two, are you talking more from a truck delivery standpoint, and we could see parts and service get better in the second quarter?

Hi, Chaz, you’re pretty much right and we do expect that truck group sales will be down than the second quarter slightly, although but parts and services I’ve said the last on our last call, that I expect it started rebounding around this time and it is showing, the first quarter shows those signs and we believe that to continue in the second quarter as we’ve said as capacity and tonnages reached an equilibrium out there and I believe that to be the case, truck sales will be down, but parts and service should remain stable and growing.

So we could see the top line be under maybe some pressure, but margin improvement relative to the first quarter?

Yes, overall margin improvement. They’re obviously driven with top line down and, your parts and service sales up as you know it’s obviously a more profitable piece for business source.

Rusty has your outlook changed for 2010 just in terms of the overall heavy-duty market, I think last time I recall you had mentioned a number around 105,000 for retail sales for the U.S.?

I mean, I look at the first quarter, first quarter deliveries were in the 24,700 range. So, obviously, annualize that it’s a little under 100,000 and I expect second and third quarter to be down, so if it changes any just take it up slightly, but again towards the back half of the year, towards that last quarter of the year. The last three to four months the year would be where you would see it.

Then last one, I’ll get back in the line and off the call. When we think about the recovery in ’11, ’12 and ’13, and I know this was kind of a tricky question, but are you guys kind of thinking that anyone of those years its back to on ’06 level on the heavy-duty front that we could approach retail sales of 300,000? Are we talking about more traditional replacement demand that’s said to more along the lines of maybe 200,000?

It’s fairly truth Chaz that have to go someone in the middle there. Obviously, you’re not going to have the emission issues to deal with new technology and there is no government interference here it will just be driven by industry and by market demand. So I would look for a peak in 2012 milestone, somewhere in the mid 2s, it’s a little far out for me to forecast that exactly where I think it will be in 2012. I would expect something in the mid 2s.

Your next question comes from Tim Denoyer, Wolfe Trahan.

Can you discuss roughly how much of the new and used truck margin improvement came from used truck pricing picking up? Or was some of that from new?

Majority of it was from used truck price in town, our used truck pricing as firmed especially in the last 60 or 90 days, so there is no question that you got an inventory that you traded for over the last, half of last year, but pricing is firmed here in the first quarter of this year. By nature, you’re going to get natural pick up in margin. No, it’s not something is probably sustainable over the long term, but couple of quarters is sustainable, because you’re dealing from an inventory that you traded for prior in the prior six months.

Can you just talk about, so which parts of the used truck market are you seeing strength in? Is it mostly the one to two year old aerodynamic kind of trucks, or are the older trucks gaining that same kind of price increase?

Well, it depends on what you define older trucks as right now most trucks within, most trucks since they’re not over say 650 and under 600,000 miles and within four, five years of age made in 2006 and up holding fairly steady that you’re seeing it across the board. You want a two year truck is commanding and nice, but it’s across the board may be a little more on those, but it’s across the board.

Jumping to parts and service, can you discuss the seasonality that you would normally see kind of coming through the spring season on parts and service business; and how this year has compared to those? Perhaps just how it’s gone into April?

Its been genuine, what we saw in the first quarters continue in the April I would tell you, now last year is not historical obviously 2009 was a whole different year, so I can’t say 2009 is going to be down okay, that was not a difficult year. If you go back in history without say over the six years, it did not look like that, but typically our parts and service business rises through the summer months, as temperatures heat up and we’re mainly across the southern parts of the United States it tends to lead to a more parts and service business for us opportunities for us.

As the increase you seen this year is up normal not actually last year, but relative to your prior years is that normal? Not excluding last year, but relative to prior years, or do you think that’s a little bit better?

This is the signs of sustainable recovery it’s what you see whenever you start saying equalization from tonnage and capacity, the capacity being pulled back into the market to all played obviously you have to spend more in maintenance get it ready to run so, it’s typical what you see is the beginning of signs of recovery.

One other, kind of one-off question, just wondering if you can confirm, I just heard that there might be some municipalities out there who may not be allowed to buy engines that aren’t certified to the 0.2 NOx standard, that are certified with credits. Have you encountered that in any of your sales?

Everything I am aware of it is out in California, okay, I mean, I’m dealing with Port of LA out there, we’ve had significant activity out there with the last half of the year, but earlier over the last three quarters of that going on in California, I am not really aware, but anywhere else.

Your next question comes from Jamie Cook, Credit Suisse.

A couple questions one, Rusty, what are you hearing from, I know we’re not really ordering 2010 trucks yet, but what are you hearing from customers on the preference on the 13 versus the 15-meter truck? When do you expect to take orders for the new PACCAR MX engine? Then in terms of deliveries that you’re seeing today with the ‘09 truck, what percentage is the Caterpillar engine versus Cummin versus like six months ago or three months ago?

We saw I think about for the 2010 year model on CAT plus engine?

Well, yes, but it’s like for the transition engines, what are you seeing? I’m hearing that there is a lot more the older CAT engines that are out there. So I’m just trying to see if you’ve seen that change too in your deliveries?

Yes, we’ve seen, mix has been in fact, it’s really what you have. When you get down at this point and change over, if you have more Caterpillar engines you’re going to sell more, basically we have been out of pre-2010 Cummins engines, whether it was still some availability of pre-2010 CAT engine. So, naturally you’re going to see a ship when you’re comparing those two, okay. As you talk about the MX engine, we’re selling in right now; we’re specking them and selling them as we speak.

For delivery when?

For delivery starting in the second quarter or really at the end of June, more less June delivery I will tell you.

They don’t have EPA certification yet, right?

They have, as far as I know, they are past the first EPA.

Okay, so you can still take too, okay.

You can take the order there is not delivery going on at this time.

Until they get the actual final approval, correct?

Yes, it’s a final approval we’re very comfortable that we’ll be taking care of the nice time and manner so.

Then just how much, I mean, what’s your sense of I know there is not a lot of the Cummins pre-'10. Yes pre-'10 2000. The Cummins pre-'10 engine out there. What about how much more is left on the Caterpillar side? Do you have any sense?

Jamie, I always just fixed down, I mean it’s going down quickly, so they don’t think there is any issue there with any manufactures inventory as far as that goes old inventory it is…

But that can’t help your second quarter at all, when I’m just thinking about you seen a second quarter deliveries could be weak, I’m just wondering at that scenario opportunity. You know and I mean…

This Jamie is possibly an area of opportunity, but you know, I’m not going to say here and right the second quarter into that in, pick the whole the second quarter up about and really not.

Then just a final on Rusty congratulations on buying the Navistar dealers, I mean as you think about it long term, have you guys thought about what the contribution could be to EPS overtime? Or sort of where the market share is for that business versus where you think it can go over the next couple years? Or any public comments you want to make about that acquisition?

Jamie, I really don’t want to talk about market share or EPS, you know I’m not going to do that on the call, we are excited about the new safer division that we’re putting together. We do think there is a lot of growth potential for us, but as far as getting into specifics right now, I’m really prepared to do that, but it is going to be a safer division of rush enterprises one separate from our division and we’re excited about the growth opportunities that are in front of us and our partnership with that division, with that manufacture.

Last, why don’t we finish up on Construction Equipment? I mean it sounds like that is still pretty weak. I’ll tell you, I am hearing anecdotally in the channel from some of the suppliers and dealer checks that construction in particular in the regions you serve could you know I mean is starting to show modest signs of life. Just wondering, if you are hearing sort of the same thing anecdotally and whether you think sort of we’re near a trough here for your Construction business?

I think you know your truck might be the appropriate way to describe us, we’re really, really low run rate on a market side to this point on area we serving. As far as improvement, I don’t see anything on the presumable future to get this a whole lot of robust recovery for share. So we think will pretty much bubbling along the bottom as what we’ve said before, even in terms using the truck business, we think that probably what’s going on into that market right now in the Houston, as oil and gas recovers that market will recover, it’s just kind of like when will that happen. So that market especially on the CD side is still very much tied to oil and gas. So the oil and gas improved, we look to see that improvement I don’t see it happening right now.

Your next question comes from John Barnes, RBC Capital Market.

Rusty, your commentary talking about ‘11, ‘12, and ‘13, given that we have kind had some government intervention in determining Class 8 truck sales for I guess the last eight years or so, in trying to decide what’s a consistent level of Class 8 deliveries on a go forward basis, should we be lopping off the top end, that anything over like 250? Do the numbers kind of reset here, given that you are not going to have the government intervention? You're going to take out the highs and lows. Is there some kind of normalized level?

John, I don't think in 30 plus years I've ever seen a normalized level, okay, but whatever is, but I do believe in response to your question, then when you do take out of the government influence that we shouldn't have at least for the foreseeable future. Yes, you possibly can take-off the highs, but the character to that is my property you’ve never seen the lowest that we just saw either, right. So carrying, but I think I have a big market, you’re going to be talking 250, 260 US retail I don't believe you see a 300 pushing to 300 US retail again, but I’ve never seen a 97,000 low like it was in 2009 either. So, sometimes you can get a little pushback from that given that the EPA or the government side I would not influencing it, but the truck was so deep that the peak can go higher than what you would we think as I said there is no such thing is the normalized year in the truck business in the Class 8 truck business, but I do believe that we’re going to see extremely strong years that will average if you take the three years together however they run together. They're going to average some where in my box in the 220 to 250 range. I really believe that 220, 240 somewhat that range the averaged some of that run like that, but 11 of probably be little less than 200, but I expect 12 to be a strong, strong year and 13 to follow suit. I mean you just got to look at the age of the fleet that is out there and what's on the road and look at the miles that I've see on lot of these trucks that there right now and they're piling up quickly and you can go with just kind of replacement cycle that we’re going to continue on the next couple of quarters with not have some kind of large, large kind of demand that has to be satisfied.

Do the same years apply for medium-duty as well I mean ‘11, ’12 ’13 or is that pushed out a little bit?

I don't know if the price spot is big, but yes ‘11, ‘12 and ‘13 will have to go up because there is going to be pent-up demand there, There just hasn’t been low placement and I realized mileage average miles run per unit have been down the last couple of years, but we’re talking about in four years together like this so regardless of average miles being down the total miles are still way up on the equipment that is out there, and the total uses is still up, so I mean even in vocational markets, I means if you start breaking down vocational markets, there has been nothing going to down either in the last three years. So regardless of under utilization, the actual totals because of the length of the down cycle, they are getting rather large and the age is also piling up and you have that together in all those environments in all those markets and I don’t see anything but big years in a ‘11, ‘12, and ‘13.

Given your outlook for those years, are you doing anything inventory wise to prepare for that, either on used, new, medium-duty?

Let me look a little far out to be preparing inventory, so that right now. It’s not too hard to get a truck sell.

Even on the used side?

Well, the used side is sometimes little more difficult, maybe the used truck business is normally people get is not that difficult. It’s really a supply demand business. So as you look back and what was sold in prior years is pretty much going to tell you a lot about what pricing are going to be, we’re finishing working our way through the 2006 year probably right now, which was the ’07 model trucks and we probably continue doing that the rest of the year but once you get through that, we didn’t sell anything in ’07, ’08, ’09, 2010. So your supply side is going to be low, so just by nature with any kind of demand your used truck pricing is going to be very strong.

On the parts and service side, two things. One, can you talk to I have asked you this a couple of quarters in a row, but have you started to see the turn yet in kind of the average dollar amount per service call in your service division and is there any chance that, because of the age and the miles on the trucks right now, that you could experience a little bit of a bubble in parts and service just given the required maintenance on it?

I think you are starting to see that, we were up 10% sequentially in revenues quarter-over-quarter. As I mentioned earlier on the call, there is maintaining in the first part of April, we are maintaining that if not see further acceleration. I want to say that bubble lets jump too much, but it is continuing down the path, but it started down in the first quarter.

Your next question comes from Bill Armstrong, CL King and Associates.

Most of my questions have been answered, but aside from freight, which we know is showing signs of improvement, can you update assign any trends that maybe meaningful going on in any of your major vocational markets?

I would tell you, refuse business we feel real good about not just with municipalities and also with and private carriers we are excited at where we really see that market gone over the next two years, we think over the next couple years we are going to see very nice addition to our business and that’s factor we get lot of sales out of that factor. I would tell you that oil and gas I showing times of recovery, the one table and is not situating for is housing. Housing in course is the biggest driver that is and we still don’t see any times of that either has some pickup some got lot of capacity gone out of the market place, but I know that some of the flat become is have a some pickup in their business, but I don’t believe is driven by housing and driven more by steel and things like that. So, where that would be the biggest housing in auto as we all know that is the biggest driver there on and I think if they could, will may do pickup along with the other locations which are going to pickup that drives allow that locations of this and housing picks up obviously that drives already mix business, the big driver besides commercial real estate and obviously housing is the biggest things that is. So, but we haven’t seen that yet, but as I said refuses strong mixer business and I’m not so strong yet oil and gas picking up. Bill Armstrong - C.L. King & Associates : These Navistar dealerships that you’re about to acquire, do they have any particular strengths or weaknesses in terms of whether it is vocational markets or submarkets within freight, compared with your Peterbilt businesses?

Well, I really I want to get into that much detail here at this moment I’m very excited about the group, but it is a fine group if you look at where their located at during the big truckload market areas. You thought self is pretty big truckload markets, so that would be the strongest suit that you see when you look at the overall market. We are very excited, this is going to be a separate division for us as I have stated over and over and we are excited about the growth we hope to see the inside that division going forward. Bill Armstrong - C.L. King & Associates : Then just one housekeeping question. Within the medium-duty trucks, how many buses were sold during the first quarter?

Let me fully achieve here hold on one second. 98.

Your next question comes from Brian Sponheimer, Gabelli & Co Brian Sponheimer - Gabelli & Co: Just on the acquisition, I know you can't speak too specifically, but purchasing 11 Navistar dealerships is clearly a positive signal for their engine technology. Just from a customer standpoint, can you maybe directionally give some ideas to what your customers are saying about the EGR technology and where you see that’s heading into the marketplace?

I think it’s a little early for me to say, I mean we haven’t even finish the purchase yet, but as I have stated in the past that I believe all manufacturers, whatever technical, whatever technology they take that they will figure it out. Again to the day, all engines usually always work. They always have if you look back a history, no matter what technology has been chosen. So I am comfortable, obviously very comfortable with the PACCAR, SCR technology and I know Navistar, and I’m very comfortable that they will figure out their technology also and then all the engines were going forward and service the marketplace as they said.

Your next question comes from Basili Alukos, Morningstar.

Kind of a follow-up on the international acquisition, I understand that you don’t want to comment, but I guess I’m wondering by any agreement with PACCAR, how the acquisition of expanding more Navistar that’s putting up against any covenant or any restriction of it that you have? What’s that agreement and you may have to kind of rewrite better or having an amendment kind of similar to, I think in some more experience what happen in the purchase of the American Truck Source, but the Texas and Tennessee operations? Are you ultimately had to kind of make an amendment?

I understand that also be going forward. Now this really doesn’t have any effect with our Peterbilt and PACCAR representation. We will continue to represent that as strongly as we always have, if not more and the investment will continue to be strong in our Peterbilt business. The Navistar acquisitions, and our mentality and what we’re doing, we will not made Navistar acquisition in territories were we have Peterbilt dealerships. These will be in other areas where we are not located currently, that is not our intention is to represent two manufactures in the same areas or areas of responsibility. So as we go forward you will not look to see us making any acquisitions in the territories that we already represent Peterbilt, okay. We are committed to Peterbilt in those markets, in the markets that we buy Navistar dealerships. We’ll be committed to Navistar in those markets. So that is our thought process as we go forward. So I hope that I explained you.

Yes, I mean I’m not accusing that all, I wasn’t be intent, I was just curious at what point may PACCAR kind of realize what?

No, I don’t believe there is a point there, there’s nothing that is a separate division and there is nothing contractual or anything else that has any say so on that.

Kind of a follow-up, for anecdotes quality for the supply of quality used trucks for one to two years is shrinking pretty considerably. I know PACCAR mentioned on their call yesterday, how prices for those used trucks are up $2500 year-over-year. I’m wondering if you can kind of just comment on what you see the supply of quality used trucks is like today.

These are about one to two years truck is PACCAR right, there are shrinking quickly and they won’t be any. Normally you wouldn’t have a one year old truck unless reprocessed it anyway, okay. First you think about that, which trades a truck after a years, but look at the market, you’re talking about 97,000 and 130,000 or so, U.S. retail. So there really were no trucks put into marketplace in 2008 and 2009. So just by nature you wouldn’t have any on that, but then also when you add in the fact people have been looking for one and two year old trucks given the cost increase of new technology, given the machines issues that have been driven out in California right now. Those two combines take up whatever is out there, they really do. So there’s no question that those value of those one and two year old trucks are up. As I said, first off you don’t get many of them to begin with to running outside.

Then kind of follow-up to that, I’ve heard some thoughts that kind of like the third user in a truck’s life, maybe the agriculture that because there’s been such a meager level of purchases the last couple years and then now you have – so there isn’t that big of a supply of used trucks. Now everyone is desperately looking for a used truck to beat the price increases that there may not be ample supply for kind of the third user in the lifecycle of a truck. Like agriculture, like I said and they maybe forced now instead of going after a used truck to purchase new trucks going forward in the next year or two. So I’m wondering if that kind of thought process makes sense, if that something you‘re seeing or…?

I don’t know that they could support the cap cost of a new trucks, but I don’t really see that taking place much simply because those markets do not provide the income strength to pay for a new truck, okay. So it would be very difficult for those third markets and fourth year markets. I don’t necessarily believe they all go into agriculture either. I think they go a lot more into localized hauling, more into hauling gravel around town, things like that, that’s is where I see most of them going into not necessarily agriculture, but there will definitely be a shortage of supply. I mean we just roll forward, like I said all you look at what we’ve sold in 2007, ‘08, ‘09 and what’s going to be sold in 2010, so as we go forward all the used markets will be affected, because of the lack of supply.

Your next question comes from Chaz Jones, Morgan Keegan.

Rusty, I had one quick follow-up. You guys have done an outstanding job in the downturn of scrubbing the cost structure. I think SG&A is down about 17% from the peak and if memory serves me right, I think headcount is down about 15%. The first part of the question is how quickly once business starts to pickup? Do you have to start adding people and expenses to the cost structure? Then the second part is if we look back at '05 to '07, net margins sort of peaked at 2.5% on the business and just kind of the second part of the question is, should we be thinking of net margins any differently this cycle?

No, I’ll answer reverse order, Chaz. Net margins, I think it’s sustainable back to the peaks of the cycle. I believe we’re sustainable in achieving those again, no question and we hope to try to do better, but I’m not going to see and guarantee it to you right now, but I do know, what we can get back to those peak margins. G&A as we go forward, we look to get some leverage obviously as the market accelerates now, obviously we’re in a business, where you’re handling parts and turning wrenches and thinks like that. So it does take manpower to do this, when you strip as we have over the last couple of three years out of the organization, you will have to gradually add back some, no question, but we’re going do our best to managing that and get as much leverage as we can out of it as we go forward. So I’m not going to specifically answer this certain timelines for you Chaz, but we’re managing diligently, just like we did in the downturn. We’re going to make sure that we continued to use the same things we used in managing going down. We’ll do the same going up and not get caught up in an environment that’s rising on the revenue side. It’s up to us to maintain somewhat of a lid on expenses.

Last question and I’ll drop-off again. Is the financing of equipment an issue at all anymore as we look at the near term? Is that still any type of issue in getting new equipment?

In my mind, it’s not that big of an issue for the buyers in a marketplace right now. If you look at what happens in the peak of the cycle that other buyer will shows up and they didn’t showed up yet. I would tell you that would still be an issue that the second tier buyer. Right now the only people really buying are the first tier buyers, your A and B paper. It’s when you get into that other paper that you really don't have any players out there, but typically okay reduced that to be finance maybe show up a year to from now when the market gets out that want to participate that will buy a little deeper, and I wouldn’t expect this to be any difference in any other cycle, as we go forward, I mean if you really look at you got GE just reinvested in the truck retail finance business, but they are taking over the running Navistar finance business, there are still our strong players out there that they will stay even though GE has it's obviously how they are going to be handing of whole finance division they are invested in the transportation industry.

Your next question comes from Robert Kosowsky, Sidoti & Co. Robert Kosowsky - Sidoti & Co: Just curious, coming out of this downturn and with the more expensive engines coming down the pike, do you anticipate any shifts in buying behaviors amongst your different customer segments like do you think you might see some smaller fleets, or have you seen smaller fleets and owner operators loading up on used trucks or anything to make you scratch your head on that?

No, I saw question that's been going on, that’s what you surprising as found up pretty clear recently and that's just been last 60 days phenomena. Robert Kosowsky - Sidoti & Co: That's sound like the smaller fleet owner operator customer segment?

I'm sorry Robert Kosowsky - Sidoti & Co: Has it been more on like the smaller fleet owner operator customer segment?

Not owner operator. It's been small to midsize the large companies are still going to buy new equipment. Your big truck low carriers as you, your large vocational first going to buy new equipment, which is small to midsize fleet have looked at packages of 30 years packages and 70 years, I know things like that, there is no question of that’s going on. So I feel along, like I said along with what’s happen on the West Coast within replacing all those engines has been a big driver for use truck price informing us. I’m going to figure and tell it's through the roof anything like that, but it has firmed up and as we roll forward, I would expect to continue to stay that way, I wouldn't look for any more hits in the used truck market like we had for couple of different times over the last three years. Robert Kosowsky - Sidoti & Co: On the parts and service side, have you seen any up tick in what you guys would deem more discretionary I guess services you guys are doing like maybe a dent, a fender that you wouldn't have fixed last year but might have fixed back in '06?

No, no really I don't think as seen as much discretionary side, I think it's been more driven by putting excess capacity and real work and getting maintenance done on truck and if maybe it was cannibalized or something dealing with one of that excess capacity putting other trucks back into work that fixing getting it back on the road. Because they have freight to haul with it and they are going to take that asset and they're going to all fleet. Robert Kosowsky - Sidoti & Co: Then just on the international acquisition, the Lake City acquisition, could you give some background on how you were talking to Lake City and if you could describe maybe the additional acquisition environment out there, given the cycle we are coming out of and your appetite for cash?

Well, no longer figure here and talk about how long we were talking to locate, no I’m not going to get into that, but I will say that we do believe that there will be opportunities for other acquisitions in that division as we go forward as we work with that OEM, we don’t talk with that OEM, and we work with that OEM, future growth. As I said as a separate division, we are going to go forward with growing that division outside of our Peterbilt divisions in areas that we are no longer are. So we do believe that there are opportunities do exist for that. We are remember it’s a fairly fragmented dealership organization, so there will be opportunities, I do believe as we go forward, but first we’re going to get this from closed and we will just take it from there. Robert Kosowsky - Sidoti & Co: Do you have any idea how long it would take to do the integration of Lake City into Rush? I know it is going to still be kind of an autonomous unit.?

Yes, it’s an autonomous unit, there is an integration and you say integration as I said we run the set of business units and I don’t believe that to be that difficult to integrated in because it’s not going to integrate in operationally with my Peterbilt division I mean so when you are not integrating it operationally, that takes away of lot of the issues that you typically run into when you are integrating an acquisition. So it will run operationally autonomously, there will be obviously some back room functions that will cross over. You must understand that the reason that we choose this group, this was the group that we choose, but this was the very strong group that had a strong organization, okay. They have the important organization in place that we believe will allow us to have expertise growth in the future. So we can leverage all for this group a very successful strong group. We believe one of the top side Navistar dealers around. So it’s not somewhere in that group. So that’s why we are excited that we can leverage all to perform a base in separate division on.

Your next question comes from Jack Waldo, Stephens Inc.

I've got two questions. Kind of bigger-picture questions, one is, as it pertains to both your lines of business, maybe if we look back to 2006 or 2007, how much capacity have you added maybe in terms of truck dealerships or in terms of bays for repairs?

I’m going to be flag in this employer, I would tell you, I speak to you basically we have added markets, look at this market we have added some new stores since that time we get into state of North Carolina obviously we enter Utah and Idaho with the little piece of organ so its more about markets to me, for me to explain as we increased our footprint. We increase our breadth of touch, we have added store in Oklahoma we are just opening up taking up Oklahoma facility and it opens up here shortly and tripling the size of it and okay open ups for first June will open the store in Yuma, Arizona, I don’t like and qualify for you in the percentages like now, but since ’06 we were in the (inaudible) vehicle in that timeframe we added one over and really Atlanta in late ’06. So I mean you’ve got a the either decision had about luck for you, but sometimes its little bit, you think it is a long way, laid a lot we know you get a huge market pickups, so what you want to say 20% something like that maybe I don’t know but this is flag I don’t have specific answer for you on that question right now.

The main thing I was trying to understand is, you said before you thought your margins could get back to historical levels?

Sure.

I was trying to figure out what your revenue could get back to and I realize that we might not have a…?

That has to do in size the market now and do I get a 290,000 US Class 8 retail market? I don’t get that.

If you get a 250 can you generate the same revenue, I guess is the question.

Would see no reason where we could. Okay, because I think we have also added some other ancillary things and vocational markets, this were going to be much better and as we get in, those vocational markets where it would be rough use whether it be mixed it in plane or selling we have added different other markets specific sales forces and focuses inside the organization that I look to take better advantage into those individual markets as we go forward. Yes, I don’t like as any question like revenues achievable, that could my job just make it more than that and that’s what we working on right now.

Then my second question is, with your acquisition I understand the strategy. I would like to understand maybe a little bit more how you look at it on the financial side. When you evaluate these acquisitions are you looking to pay a multiple of book value? Or are you looking to pay multiple of EBITDA? Are you looking at accretion? Is there anything that stands out, how you look at that?

Well, I mean I got an answer for you, but I mean there all different, I mean when you look at acquisition that you have to understand more of and just, what’s you are looking out on a piece of paper, you’ve got to understand market side, what is market potential? How is the market being captured to that time, are they meeting what should be there, you know market standards to the national standards of an organization. We look at there is so many different things and go into it and you know look at it like Lake City acquisition, as what it is providing, as providing a platform for growth force, so at this time is the foundation for future growth, you take assets basically and then you take a multiple after tax earnings is that you physically look at that’s how we because you’re dealing normally, typically with a private owner are always a private owner, exist with only public truck company out there, think so its providing and usually they are existing business, so you going to look assets, hard assets so then you can some multiple of after tax earnings on the three year, five years scheme depending you are in the cycle and you know typically the EBITDA comes in about 5.5 okay but there is different factors that go into the determining those price.

Is it fair to say that you wouldn't do a deal if you didn't think it was accretive in year one?

I don’t know about go there, if I think it was creative I wouldn’t do, which you could plan a cycle, what part of the cycle are you buying, I mean I can look back at acquisitions we did 1999. We bought the Arizona acquisitions to the peak of the cycle where they accreted that first year when the market tank in 2000, 2001, but they are big piece of the large equation what we’re trying to accomplish over the long-term you bet they were, so in the flip flap of that as you take a Florida acquisition that we did coming out as in 2002, 2003 were there won’t making any money, and we you pay these, you can look that we pay this huge multiple of earnings, yet we made all that back in two years, got to understand the cycle and note you know as more to it then just look at that like an wide on peace of paper living in a steady its not that way, when you got to understand in the industry

Well, you guys should be commended for the efforts you have put forth during this downturn?

Thank you, I appreciated goes to my employee is not to us here in it’s a lots of effort on lot of people out there across the 12 states that we currently represent across 15 we are fixing. Jack Waldo – Stephens Inc.: Well, hopefully we get to see the fruits of that labor here in the upcoming years.

That makes two hours that inform as last three years has been lot of work. The quality of the organization, the quality of the people has shown through time and time again as we managed to keep this thing positive than ever, and outside of GM actually in the market with an appraisal respective never had with losing quarter.

Your next question comes from Gregory Macosko, Lord Abbett.

I wondered about natural gas conversions vehicles, do you see anything in terms of commercial vehicles or the some of the long haul trucks. Is there anything going on that you’ve sense in the market place?

From my perspective, no, I would say that we probably been about the biggest participant natural gas its all country given our focus in Southern California. When you look at it in from a long haul perspective, it’s still in the infra structure inhabited technology, if you don’t have the infra structure to support the feeling you can’t have the technology. So it is better still going to be the biggest inhibitor to that technology now, when you get into more localized, when you get into the rough use market, when you get into say the port, some of the ports that are out there, I think you’ll see not just what’s happen in California. As you go forward, I would anticipate other ports as they’ll be getting under. As the EPA clamps down on these ports for the emission issues a lot of these areas are dealing with. You are going to see natural gas come about in a lot of the port area, not just towards taken out often in California, that will continue to grow and it will continue to grow with in the municipalities, from a municipal perspective, because those trucks don’t believe there, the city. So it’s easy to get fueling stations and things done. We do a lot of propane stuff in the bus business in Texas. We sold I can’t remember how many, I would say 400 propane trucks or so in the last couple of years into the state of Texas, because you can build the infrastructure to support. I think if you look now, you go to New York and the New Jersey ports are already looking at natural gas, but you are limited on the long haul until you get the infrastructure in place.

But how many roughly, did you see five, 10, 100 whatever in your areas? Is it all in LA, I guess, or…?

You’re talking about in the ports?

Yes, the areas - the new areas in the last quarter or the last three months. Have you seen anything in terms of conversions?

As far as the converting new trucks selling new natural gas trucks are converting old truck?

Either.

Well, I don’t think of converting old trucks I don’t think there is anyone out there to do it, but as far as selling new trucks you bet, I mean we’ve sold a couple hundred how is that, into the port of LA or in process of selling a couple of hundred into the Port of LA right now with natural gas. We’ve sold a lot of natural gas in the refuse over the last couple of years that’s been going on a lot more than that.

But, no long haul.

No long haul you don’t have the infrastructure and without that, it doesn’t make any sense.

Sir, I’m showing no further questions in the question.

Well, we appreciate everybody’s time and obviously, we’ll talk to you after the second quarter earnings release that’s sometime in July. So thank you very much for your patience and time.

Ladies and gentlemen, thank you for your participation in today’s conference. This concludes the program. You may all disconnect. Everyone have a great day.