Good day, and thank you for standing by. Welcome to the Autoliv Inc Third Quarter 2024 Financial Results. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Anders Trapp. Please go ahead. Thank you, Sonia. Welcome everyone to our third quarter twenty twenty-four earnings call. On this call, we have our President and Chief Executive Officer, Mikael Bratt, and our Chief Financial Officer, Fredrik Westin, and me, Anders Trapp, VP, Investor Relations. During today's earnings call, we will cover several key topics, including our sales, earnings, and cash flow development, the high number of new product launches, an in-depth look at the China market and how we succeed with the growth of Chinese car manufacturers, how our strong balance sheet and asset return rates support continued high levels of shareholder returns. Following the presentation, we will be available to answer your questions, and as usual, the slides are available at autoliv.com. Turning to the next slide, we have the safe harbor statement, which is an integrated part of this presentation, and of course, includes the Q&A that follows. During the presentation, we will reference some non-GAAP measures. The reconciliations of historical GAAP to non-GAAP measures are disclosed in our quarterly earnings release, available on autoliv.com and in the 10-Q that will be filed with the SEC. Lastly, I should mention that this call is intended to conclude at 3:00 P.M., Central European Time, so please follow a limit of two questions per person. I now hand over to our CEO, Mikael Bratt. Thank you, Anders. Looking on the next slide. Firstly, I want to express my gratitude to all of our employees for their contributions to our third quarter results and their ongoing efforts to enhance our competitiveness in the near and medium term. Despite facing significant market headwinds from weak light vehicle production, we maintained solid sales and earnings in the quarter. This is a testament to the company's ability to adapt and thrive, leveraging our diverse product portfolio and strong customer relationships. Autoliv managed to outpace light vehicle production by four percentage points. Despite lower sales and relatively significant supplier settlement, the adjusted operating profit was virtually unchanged. This was driven by effective cost reductions and cost compensations. I am also pleased that the inflation compensation negotiations have developed in line with our expectations, with only a few negotiations still outstanding. We are making good progress towards our previously announced intention of reducing our indirect workforce by up to 2,000 and related savings of $50 million in 2024. We also managed to reduce direct headcount by around 6%. Cash flow continued to be strong, supporting a high level of shareholder return. In the quarter, we repurchased and retired 1.3 million shares for $130 million. Under the current mandate, we have repurchased over 10% of outstanding shares for $917 million. Earnings per share improved 11%, mainly from the lower number of outstanding shares and a lower tax rate. We are reiterating the adjusted operating margin guidance of around 9.5%-10%. With only a few months left of the year, we expect to come in at the low end of the around 9.5%-10%. Our operating cash flow is on track towards the full year guidance of $1.1 billion. Our balance sheet remains strong, which support our continued commitment to a high level of shareholder returns. Looking now on the market development in the third quarter on the next slide. The total global light vehicle production for the third quarter declined by nearly 5%, which was almost in line with expectations at the beginning of the quarter, according to S&P Global. However, the regional mix differed significantly. We observed further reductions in North America, primarily due to slow vehicle sales and inventory adjustments by key OEMs. Similar trends were noted in Europe and Asia, excluding China. However, these production cuts were mostly offset by increased outputs from domestic OEMs in China, driven by scrapping incentives and subsidies. This shift resulted in a more unfavorable regional light vehicle production mix, significantly impacting our top line performance. We did see call-off volatility improving slightly from the second quarter, which is unchanged year-over-year. We will talk about the market development more in detail later in the presentation. Looking now on our cost improvements on the next slide. We continue to generate broad-based improvements in key areas. Our direct labor productivity continues to trend up, as we have reduced our direct production personnel by three thousand one hundred year-over-year. This is supported by the implementation of our strategic initiatives, including optimization and digitalization. Our gross margin improved by a hundred and ten basis points from the first quarter, and by ten basis points year-over-year. The improvement was mainly the result of direct labor efficiency, reduction of the direct and indirect workforce, and customer compensations, partly offset by lower sales and costs for supplier settlement. As a result of our structural efficiency initiatives, the positive trend for RD&E and SG&A in relation to sales has continued, declining by more than 130 basis points since Q1, 2023. Combined with a gross margin improvement, this led to a substantial improvement in adjusted operating margin versus Q1, 2023. Looking now on financials in more detail on the next slide. Sales in the third quarter decreased by 160 basis points year-over-year, or by $42 million, due to unfavorable currency translation effects, lower light vehicle production, and a negative regional light vehicle production mix. The adjusted operating income for Q3 decreased by 2% to $237 million from $243 million last year. The adjusted operating margin was virtually unchanged despite lower sales. Operating cash flow was $177 million, which was $25 million lower compared to third quarter last year. Looking now on our sales growth in more detail on the next slide. Our consolidated net sales was $2.6 billion. This was $42 million lower than a year earlier, driven by lower light vehicle production and negative currency translation effects, partly offset by higher out-of-period cost compensations and by a positive price and product mix. The negative currency translation effects reduced sales by almost 1% in the quarter. Out-of-period cost compensations contributed with approximately $8 million in the quarter. This was $2 million higher than in the same period last year. Out-of-period compensations are retroactive price adjustments and other compensations that mainly relate to the first half year, but were negotiated in the third quarter. Looking on the regional sales split, China accounted for over 19%, Asia, excluding China, accounted for 20%, Americas for 33%, and Europe for 27%. We outline our organic sales growth compared to light vehicle production on the next slide. Our quarterly sales were slightly below our expectations, primarily due to more unfavorable regional mix. According to S&P Global, light vehicle production declined by 4.8% year-over-year in the quarter, which was 70 basis points better than initially anticipated at the beginning of the quarter. We estimate that the geographical light vehicle production mix had 130 basis points negative impact on our outperformance. Despite this, and that some key customers were adjusting inventories, our organic sales growth outperformed global light vehicle production by four percentage points. We continued to outperform light vehicle production significantly in Japan, rest of Asia, and in Europe, fueled by product launches and pricing. The outperformance in rest of Asia was driven mainly by India. We expect a continued strong outperformance in India from a number of launches in the third quarter. We underperformed light vehicle production by one percentage point in the Americas, despite outperforming light vehicle production by more than 15 percentage points in South America and performing in line with light vehicle production in North America. The underperformance was due to strong light vehicle production growth, with low content vehicles in South America, and a sharp decline in light vehicle production in the high content market of North America. Our underperformance in China narrowed somewhat from the second quarter, despite a stronger than expected performance of vehicles with relatively low safety content in the quarter. Domestic Chinese OEMs accounted for 39% of our China sales in Q3. We grew sales to this group by 18% versus a year ago, more than twice their light vehicle production growth of 8.5%. On the next slide, we have the key model launches in the quarter. We saw a record number of significant launches this quarter. As shown on this slide, four of these models are from Chinese OEMs, and two from OEMs in India. This highlights our growing position with Chinese OEMs and our success in capturing growth in the Indian market. The trend towards electrification continues, particularly in China, but also in Europe. As shown on this slide, all but two models are being offered as electric versions. The models shown here have an Autoliv content per vehicle from around $100 to close to $400. In terms of Autoliv sales potential, the NIO and the Zeekr launches are the most significant. This is the first time we have two Chinese models having the highest sales potential. The long-term trend to higher CPV is supported by front center airbags on five of these models, more advanced seatbelts and knee airbags. Now looking on the next slide. The importance of the Chinese car market is increasing. Already today, one out of every three cars in the world is produced in China. The rapid growth of Chinese car manufacturers is impressive. Over the past decade, the Chinese manufacturers have transformed from producing low-cost vehicles to becoming global players in automotive innovation, production, and connectivity. This shift in the China market has created significant interest, and we will therefore provide some additional information regarding the China market development. Now looking at the next slide. Autoliv is the leading automotive safety supplier to both global and domestic OEMs in China. And China contributed 20% to Autoliv's global sales in 2023. Over the past decade, we have made significant investment in China and now operate 15 plants across eight locations. We are at the forefront of innovation, providing comprehensive safety system development to help our customers achieve top results in real-life safety, as well as for safety assessments done by, for instance, China NCAP and Euro NCAP. We currently serve 68 customers and collaborate with local universities, research institutes, and leading customers to drive enhancements in the automotive safety technologies. On the next few slides, I will highlight some of Autoliv's success factors in China. Chinese automakers are rapidly expanding their market shares within China. Sales of New Energy Vehicles, of NEVs, have now surpassed those of internal combustion engine vehicles, and China has become the world's largest vehicle exporter. Five years ago, Autoliv made significant investments to break into the NEVs market, which has borne fruit with notable market share gains over the past three years. While the performance of some global OEMs have negatively impacted our sales outperformance, we expect to start outperforming in 2025, based on the latest light vehicle production forecast from S&P, driven by major new launches in the second half of 2024. Some of our major achievements are achieved over 50% market share with a broad range of high-end NEVs manufacturers. Secured the global first autonomous L4 full passive safety system development and supply contract in July. Expanded our components business with BYD, with ongoing discussions for closer collaborations. Successfully reduced costs and increased margin through modernization. Well-positioned to be the overseas expansion partner for major Chinese OEMs like Great Wall Motor, Chery, Geely, and Changan. Looking on the next slide. On this slide, you can see some of the recent launches of premium models with full Autoliv passive safety systems, meaning airbags, seat belts, and steering wheels, that we expect will support our sales growth in 2025. All of these models are NEVs, and some of them are expected to be exported as well as sold domestically. Now looking at how we are expanding our business with the fast-growing domestic OEMs on the next slide. Chinese car manufacturers have become increasingly important contributors to Autoliv sales. Over the past few years, the rapid growth and innovation within the Chinese automotive market have led to a substantial increase in demand for advanced safety solutions. As a result, Autoliv has strengthened its partnership with leading Chinese OEMs, such as Geely, Great Wall Motor, and Chery. These partnerships have been instrumental in driving our sales growth in China. This has enabled us to capture a growing share with the local OEMs.... Today, Chinese OEMs represent around 40% of Autoliv sales in China, and we expect the positive trend to continue based on the order intake over the past years. As you can see on the chart to the right, we are closing the gap between Chinese OEMs, shares of light vehicle production, and the share of our sales. Our market share with Chinese OEMs is projected to rise from approximately 20% in 2022, to around 30% in 2024, and 32% by 2025. While our share with global OEMs in China is expected to remain steady at around 42%. Looking on the next slide. We have established ourselves as a preferred partner with automotive safety solutions in China, thanks to our comprehensive approach and strong relationships with major customers. The reasons behind our success are that we have built close partnerships with leading Chinese automakers. Our speed and strong local competencies makes us a trusted partner. We actively sell advanced and differentiated solutions, supporting our customers in delivering safe and competitive vehicles across the market, all markets. We leverage our global volumes and footprint to optimize our supply base and to support our customers' overseas expansion strategies. We drive collaboration to deliver comprehensive system solution. This includes developing Zero Gravity seat solutions for flexible cabin configurations, working with technology partners to create personalized safety systems. We have been at the forefront of optimization for many years, and we have come a long way also in China. These efforts have led to significant efficiency gains, which our customers appreciate for the standardization and quality assurance they bring to automated production. Thanks to increased optimization, we have maintained virtually the same headcount, while our sales have grown by nearly 50% since 2018. This concludes the China market update. Turning to the next slide. I will now hand over to Fredrik. Thank you, Mikael. I will now talk about the financials more in detail on the next few slides. If we turn the slide. This highlights our key figures for the third quarter of 2024, compared to the third quarter of 2023. Our net sales were almost $2.6 billion. This was close to a 2% decrease. Gross profit was virtually flat at $459 million, while the gross margin increased by ten basis points to 18.0%. The adjusted operating income decreased from $243 million to $237 million, and the adjusted operating margin decreased by ten basis points to 9.3%. Non-GAAP adjustments amounted to $11 million from capacity alignments and antitrust related matters. Adjusted earnings per share diluted increased by $0.18, where the main drivers were $0.12 from lower number of shares, and $0.10 from lower income taxes, partly offset by the lower operating income. Our adjusted return on capital employed were a solid 24%. The adjusted return on equity increased to 25% from 21%, driven by share buybacks impacting total equity. We paid a dividend of $0.68 per share in the quarter, and repurchased and retired 1.33 million shares for around $130 million. Looking now on the adjusted operating income bridge on the next slide. In the third quarter of 2024, our adjusted operating income was virtually unchanged, despite market headwinds from lower light vehicle production. Operation contributed with $12 million, driven by cost saving activities and commercial recoveries. The net currency effect was $4 million negative, driven mainly by the Mexican peso versus euro, and the Japanese yen versus U.S. dollars, partly offset by peso versus U.S. dollar. The impact from raw materials was around $1 million negative. Out-of-period cost compensation of $8 million was $2 million higher than last year. Costs for SG&A and RD&E net was virtually unchanged. A supplier settlement cost of $40 million, and this cost will gradually decrease over the next few quarters. Looking now at the cash flow in more detail on the next slide. For the third quarter of 2024, operating cash flow decreased by $25 million to $177 million compared to the same period last year, mainly due to an increase in working capital. The capital expenditures net decreased by $6 million compared to the same period the previous year. Capital expenditures net in relation to sales was 5.7% versus 5.8% a year earlier. The free cash flow was positive $32 million, compared to positive $50 million in the same period the prior year. The decrease was due to the lower operating cash flow, partly offset by the lower capital expenditures net. The last 12 months, cash conversion, defined as free cash flow in relation to the net income, was around 80%. Now looking at our trade working capital development on the next slide. During the third quarter, the trade working capital increased by $138 million, driven by $102 million in higher receivables and $61 million higher inventories, partly offset by higher accounts payables. The higher inventories and receivables were partly due to higher sales towards the end of the quarter. Compared to the same period last year, trade working capital in relation to sales increased from 12.5% to 12.8%. Our capital efficiency program aims to improve working capital by 800 million, and to date, we have achieved around 470 million. Improvements in inventories are lagging due to the high customer call-off volatility and hence, planning challenges that cause inefficiencies. Over the coming years, we expect the inventories to improve significantly in tandem with the reduced call-off volatility. Now looking at our debt leverage ratio development on the next slide. Autoliv has consistently focused on maintaining a balanced leverage ratio, which reflects its prudent financial management and commitment to sustaining a strong balance sheet. This approach helped the company navigate economic fluctuations, invest in innovation, and continue delivering value to its stakeholders. While investing in our footprint and returning over $820 million to shareholders during the last twelve months, our leverage ratio is virtually unchanged at 1.4 times. Compared to the second quarter, our debt leverage ratio increased by 0.2 times, and our net debt increased by $214 million, while the twelve-month trailing Adjusted EBITDA decreased by $4 million. With that, I'll hand it back to you, Mikael. Thank you, Fredrik. On to the next slide. As we enter the last quarter of 2024, the full year twenty twenty-four outlook for the global light vehicle production has been reduced by around twenty basis points since July, to minus 2.4% by S&P. The light vehicle production update is factoring in region-specific influences, particularly recent scrapping incentives and stimulus actions in China, persistent headwinds in Europe, and continued inventory correction in North America. The updated forecast indicates a light vehicle production decline of 4% for the fourth quarter. Light vehicle production in China is expected to decrease by 1.6% in the fourth quarter, following a particularly strong performance in the same period last year. The ongoing trend of global OEMs losing market share is expected to persist. The forecast for North American fourth quarter light vehicle production has been adjusted down by over four percentage points to minus 4.1%. The main reason for the adjustment is continued need for more vehicle inventory corrections. The light vehicle production forecast for Europe has reduced to minus 9% for the fourth quarter, mainly due to forthcoming fleet emissions requirements and inventory adjustments. Based on S&P Global's forecast and our own analysis, our 2024 guidance is built on the global light vehicle production decline of around 3% for the full year. Now, looking on the business outlook on the next slide. We anticipate a significant increase in profitability in the fourth quarter compared to the first nine months of this year. This improvement is primarily supported by a substantially higher light vehicle production, the normal seasonality from engineering income, structural cost reduction and strategic initiatives, cost-customer compensations, favorable currency effects. However, this is expected to be partly offset by supplier cost inflation. Looking at our 2024 financial guidance on the next slide. This slide shows our full year 2024 guidance, which excludes effects from capacity alignment, antitrust related matters, and other discrete items. Our updated full year guidance is based on a global light vehicle production decline of around 3%. Our organic sales is expected to increase by around 1%, instead of previously expected around 2%, due to the unfavorable market mix development. Net currency translation effects are expected to be around 1% on sales. The guidance for adjusted operating margin is around 9.5%-10%, with only one quarter remaining of the year. We expect to be in the low end of the around 9.5%-10% range. Operating cash flow is expected to be around $1.1 billion. Our positive cash flow trend and our strong balance sheet. supports our continued commitment to a high level of shareholder returns. We foresee a tax rate of around 28%. Looking on the next slide. This concludes our formal comments for today's earnings call, and we would like to open the lines for questions from analysts and investors. I now hand it back to Sonia. Thank you. As a reminder, to ask questions, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We will now take our first question. Please stand by, and the first question comes from the line of Hampus Engellau from Handelsbanken. Please go ahead. Your line is now open. Thank you very much. Two questions from me. It was a quite big step up in the cost takeout program. If I compare, I think in second quarter, you had a headcount reduction around eleven hundred people on this eight thousand capacity lineup program, and it was two thousand in third quarter. Could you maybe in the ballpark, maybe talk a little bit about what you see for Q4? And previously, you also indicated that might not be all the eight thousand that will be affected by this capacity lineup program. Yeah, I'll take the first. I'll come back with a second question. Yeah. Okay, no, I mean, you see that we have reduced the indirect headcount here, up to now, a bit more than one thousand two hundred. So that, that's an increase here versus the second quarter. And then we have reduced the direct headcount by around 6%. So we are not at the eight thousand combined here that you're talking about, but we are progressing in line with our expectations. So the savings that we've indicated for this year are coming through as we had expected. And then also indicating earlier. Yeah. But it's not only headcount reductions that are impacting the cost development here. There are many other improvements that are coming through as well. Yeah, fair enough. And, I mean, it's quite also a big step up on the Chinese domestic OEMs. I guess, I mean, how do you see that going forward? At what speed do you think you will be able to get more in balance, given the significant pickup in market shares from the domestic OEMs, as many of these new battery electric vehicles also have quite high content, at least, many of them, on the bigger players? I think we are, as we have indicated here and so on the slides, also making quite good progress in terms of increasing our share of the Chinese OEMs, and we expect this to contribute to our performance in 2025. We don't have a indication or guidance per se on market share here, but all in all, we feel comfortable that we are gaining good traction with the Chinese OEMs here as they also grow together with us. All right. Thank you very much. Thank you. Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Colin Langan from Wells Fargo. Please go ahead. Your line is now open. Oh, great. Thanks for taking my questions. Just to start, I mean, you mentioned that you called out the $14 million of a supplier settlement in the quarter. I thought, I'm not sure if I misheard, that this... I thought you had made a comment that this would gradually decrease. I always kind of think of settlements as being more one time in nature. So is this, should we think of it one time, or is there actually costs that are going to keep trailing? And is this sort of maybe an issue we should be thinking about with maybe the stress on the sub-suppliers that you work with? Yeah, so this is the impact from the settlement in the third quarter. That's $14 million, and we expect this to come down to close to zero, I would say, around the third quarter next year, in a fairly linear manner, so we will also have an impact from this in the fourth quarter and also in the first half of next year. Is this all related to the same supplier, or is this just sort of your expectations given the stress in the supply base? This was related to one supplier, but I cannot go into more details on this particular legal case or legal settlement. Okay, got it. And then it's pretty big step up, I mean, if I look at, even at the low end of guidance, you're going from like, the 9.3 in, in this quarter to 12.5-13.5 in Q4. I appreciate the slide 23. I mean, any framing of the big drivers here? I mean, is it, is it like usually, like, 200 basis points is sort of the seasonal engineering recovery that helps? And, and how should we think about the other big puts and takes, particularly the, the headwind that you called out from supplier cost, a material factor we should be thinking of? Yeah, sure. I mean, the two, I would say, normal factors are that we continue to expect higher volumes in the fourth quarter than in the third quarter, or also in all other previous quarters here in the year. And then, as you said, the normal seasonality of higher engineering income, I don't expect that to be the step up in the fourth quarter will be higher than the normal. But it is also then that we have the completion of customer compensation negotiations coming through, so that will also add, and then continued savings from the structural cost initiatives and the strategic initiatives. And we also expect a favorable currency transaction effect in the fourth quarter coming through. And then, as I already alluded to, we expect headwinds from the supplier cost settlement, and also from supplier cost inflation in general, but to a lower magnitude than we had in the third quarter. Got it. Okay, and so those items are sort of in size order, too, the way you mentioned them? Is that the way to think about it in terms of the impact? I didn't listen to that, but no. Yeah, no. No, I wouldn't say... I would have to think of that list then again to-- No, don't take it that way. Okay. Thanks for taking my questions. Thank you. We will now go to our next question. Please stand by, and the next question comes from George Gallier from Goldman Sachs. Please go ahead. Your line is now open. Yeah, good afternoon, and thank you for taking my questions. The first question I had just relates to slide four, where you show the customer call-off accuracy. I realize that we're tracking substantially below what you classify as normal historically, but do you think this rate that we've seen through 2023 and 2024 maybe represents the new normal? And if indeed it does, does that create any risk to the potential target for a 12% margin next year, or are there factors you can take to kind of mitigate the new normal being lower than what's historically the case? The second question I had was just, again, coming back to the Chinese OEMs, and thank you for all the detailed presentation there. But obviously, one of the very large Chinese OEMs is a purchaser of components from you, but not yet complete systems. Based on your historical relationships with customers who have started off as component buyers, is there a point in time or a catalyst where they tend to switch from just buying components to buying full systems, or is there no sort of obvious trend there? Thank you. Thank you. Thank you for your questions. Let's start with the call-off accuracy here. If this is the new normal, I don't think it's the new normal, and I have alluded to that in the past, because there is no reason for anyone to have this kind of volatility, either be it suppliers or OEMs or anyone in the value chain here. You want to have predictability and around that you can build your efficiency and you know, have a robust delivery. So as you can see from the chart also here, it goes a little bit up and down, and the first two months in the quarter, we saw an improvement, and altogether we have seen an improvement compared to the second quarter, even though it's flat versus Q3 last year here, but what that is also describing is everybody's ambition here to get back to where it was before, and I think when you dive into the detail, which we, of course, can't disclose here, but if we look at the different customers we have, for sure, customers that are back to where we were in the past in terms of less volatility or no volatility, whilst others are struggling. So, and it also moves a little bit between the months, who's having the higher volatility than the other. So long story short, it's really the current, you know, say, market conditions and challenges you see in the industry that creates the volatility, and my expectation is to get back to normal. And we have also been quite clear here when it comes to our around 12% target here, that a normalization of the call-offs is one of these building blocks. So our assumption builds on the fact that we should get back to where we have been. If we then move on to the Chinese OEMs and the components transition into more of a system supply, I would say yes, that is what we have seen historically when we have had customers that started out more with you know their in-house supplier set up buying components. As you of course move out, especially if you have a globalization of your footprint, that's almost a necessity to transition into more of a system supply from Tier 1 than doing it all in-house for many different reasons. So that's the tendency we see. And in the meantime, of course, we have a lot of contributions here from our components sales, and especially around inflators, where we are the market leader and have a great, I would say, product development and production of those components we can support our customers with. So, that's the, I would say, the summary of that. Great. Thank you. Thank you. Thank you. Thank you. We will now take our next question. And the next question comes from the line of Mattias Holmberg from DNB Markets. Please go ahead. Your line is now open. Thank you. I would be interested to hear if you could elaborate a bit on the margin, looking at sort of the low end of your margin guidance for this year at 9.5%. and how to get to the target of 12%. I would assume the big boxes are sort of volume call-offs, price versus cost, and your cost out actions. But if you could help quantify or at least sort of range in order of size or magnitude what the biggest moving parts are to get to that 12% ambition? Thank you. Yeah. So I would reference back to what we said with the starting point of around 9%, where we ended up last year. Where we said that around one percentage point then of closing the gap up to the 12%, would be from our structural cost initiatives, so meaning the indirect costs or headcount reduction. And then around 1% from a normalization of call-offs and direct labor efficiency, and they go, to some extent, hand in hand. And then the third component from yeah, our strategic initiatives, automation, digitalization, but also then market growth. And this is where we see that in the third quar- sorry, this year, we have had, as you know, revised on our organic growth number. So that moves that target up a bit then versus where we expected to come in at the beginning of the year. But then, as you said, $50 million, we're expecting to get in terms of savings for the structural cost efficiency, so that then narrows that one percentage point. And then we're also making progress here on the direct labor, so that those are the two components that we are then biting off here in the current year. And then the delta then is what will remain to the 12%. That's clear. Thank you. Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Michael Jacks from Bank of America. Please go ahead. Your line is now open. Hi, good afternoon. Thank you for taking my questions, too. My first one is just on guidance. Compared with the June, July forecast, the latest S&P estimate seem to reflect a larger deterioration in customer and regional mix than the one-point reduction that you've made to your organic growth guide. Are there any specific regions or areas where your own call-off information is looking a little bit more favorable? I'll stop there and ask my next question after that. Yeah, I mean, it's, I mean, the LVP is actually up versus, I mean, comparably, a little bit. But it's the negative mix that offsets that, and we would quantify the 130 basis points in the quarter that has been fairly consistent throughout the year, and that's also then the reduction in the guidance here from 2% to 1% organic growth. Uh-huh. But or, let's say, more or less flat LVP, and then the one percentage point is still around one percentage point on the negative mix here that we talked about, yeah. Okay, understood. And then if I can just ask, two very short questions. Firstly, how much of compensation received this year should we consider sustainable into 2025? And finally, are your call-offs showing any evidence yet of a ramp in BEV production in Europe towards the end of Q4, or is that still kind of flatlining? I'm not sure I understood the first part of your question, yeah. In terms of the compensation that you've received this year for inflation, how much of that represents a pricing level adjustment and can be carried over into next year versus one-time payments? Okay. Well, there are still also this year there will be one-time settlements with the customers that will need to be renegotiated also next year. But it is increased, it will be an increased number of, or share of, piece price adjustments versus what we had last year, yeah. But how that exactly ends up remains to be seen. As we said, we have still a few customers outstanding here for the full year, yeah. But there will for sure be a need to also renegotiate lump sum settlements next year. And then on the outlook here for Europe, yeah, I would say it is pretty much in line so far with what also the S&P numbers would be indicating, that we see a decline here of what is around 5%. Nine. Or nine, sorry, 9% in the fourth quarter in Europe. Okay, thank you. And then maybe just on the pricing question, just to clarify, so would you say, is it more than 50% that is carried over into next year, or less than that? It was around that number, but as I said, we can come back on that after the fourth quarter of where we end up for the full year. Okay. Thank you very much. Thank you. Thank you. We will now go to our next question. Please stand by. And the next question comes from the line of Agnieszka Vilela from Nordea. Please go ahead. Your line is now open. Perfect. Thank you. I have two questions, starting with the supplier settlement, if we can go back to it again. Can you just clarify and tell us, was it related to compensating them for cost inflation in their operations, or is it anything else? No, as I said, I cannot comment on that legal case. It's, yeah, we cannot say more than what we're saying. It was related to a settlement with the supplier, but the nature of it, I'm not allowed to say ore than that. Okay Okay, thank you. And then the second question on Europe. I mean, you, you reached a very solid outperformance during the quarter. Can you tell us what was the reason behind it? And also, should we kind of try to extrapolate this outperformance into the coming quarters as well? And then maybe on Europe as well, what are you hearing from your customers right now, given quite negative commentary overall from some European OEMs? Yeah, so in the outperformance in Europe is, as you would expect, two components, but we've had indicated also in some of the previous calls, some significant launches that we've had in the prior quarters that are now contributing to the top line, so that's one driver, and then it is also, of course, the cost compensations that are coming through that are also driving up the top line. When it comes to the outlook here and what we hear from the customers, I would say it's of course a challenging market environment out there right now. And we have no indications that it will you know suddenly turn into a more stable and positive outlook here. On the other hand, we don't hear anything that would have a downside risk compared to what we just alluded to here when it comes to the rest of the year here. Perfect. Thank you. Thanks. Thank you. We will now go to our next question. Please stand by, and the next question comes from the line of Jairam Nathan from Daiwa. Please go ahead, your line is now open. Hi, thanks for taking my question. So just, it looks like based on the China commentary, there is a path to increasing share and with Chinese local OEMs and reducing that mix impact. The other component seems to be content, and of course, that's not under your control. But, is there any... How should we think about content within the local OEMs increasing over time, yeah, any historical perspective? And I have just one more question. No, I think, yes, I mean, the trend is clearly that we see an increase in content in China. I mean, if you compare the Chinese OEMs with the global OEMs, I would say when it comes to the premium level, I mean, there is equal in terms of content. The difference really, if you look in the Chinese market, is that the global OEMs have maybe more higher average when you look at all the different models they have. While the Chinese OEM has a wider range between the premium and the low-end content vehicles, if we could call it that. So but I think, I mean, clearly, over time here, there is a growth on all those models as well. We are looking very positively on China when it comes to safety content going forward. Okay. And just as a follow-up, you had—you talked about the six million higher engineering income in the third quarter. Now, is that—should we consider that as, like, kind of a pull forward from fourth quarter typically, or is that unrelated to, like, would the fourth quarter still be a 200 basis point benefit? I think, yeah, I mean, the fourth quarter, we have the seasonality higher, and I think you need to focus really on what we're saying about the full year guidance here. Then, of course, you can make your own calculations on what it means between the quarters here, but nothing specifically to report on the engineering income tendency and cyclicalities, which are not the same every year. Yeah, and, it can always fluctuate a bit between the quarters, so nothing extraordinary- No. out of the ordinary in the third quarter that would also have implications for the fourth quarter. Got it. Thank you. Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Erik Högberg from SEB. Please go ahead, your line is now open. Thank you. I have two questions, and thank you for the extra color on China. And the first one on China, and sort of looking at vehicles, I mean, such as the NIO volume there and some of the others, what's really different? I mean, what changes did you do to get better traction on orders with these? And what do you think is key to really improve with someone like BYD? And then the second question on CapEx into next year. This year, 5.5% of sales. I think you've always said that your normalized level is lower than that. So fair to assume it drops a bit further into next year? Or just an update on where you are in your investment cycle. Thank you. Thank you. Let me start with the China there. I think, I mean, it's no different there compared to anywhere else in the world in terms of what you can offer to gain traction with the different OEMs here. I mean, it's all about our innovation capabilities here to provide the right products to our customers and do that in a robust way with superior quality. And I think with the Chinese OEM, of course, if we back up a few years, the Chinese OEM space was much smaller than it is today. But we were very early on to invest in new OEMs rising in China. And of course, we have gradually grown as they have been growing here. But we also, at the same time, have had new OEMs growing as well. As you saw on the slide, I mean, we're working with sixty-eight or sixty-plus, let's say, OEMs in China here. So there are quite a few and they have over the years also been consistently increasing. So we are establishing relationships with them in early stage and gradually add on there. So I think we have just a very good team in China. And we are really here making sure that we show our capabilities here in being a close partner with them to develop new models. So far, we have been successful in that, and we put a lot of focus on it going forward as well, to add to our portfolio of customers there. Yeah, and then on your CapEx question, we are in the first nine months, here we are at 5.5%, which is also what we're guiding for the full year. We have said that we have a plan here to come down to a ratio more around 5% over time. Next year will still be somewhat above that 5% target number, as we still have some significant factories or footprint here that are coming in line with investments also next year. But it should start to trend down from the around 5.5% here. Thank you. Thanks. Thank you. We will now take our next question. Please stand by. And the next question comes from the line of Elias Cohen from Neuberger Berman. Please go ahead, your line is now open. Hi. Thanks so much for taking the question, and congrats on the progress you made in your strategic initiatives and the results you're yielding in a tough environment. I have two questions. The first is, just any, you know, any comments around profitability in China would be very helpful to us investors. I believe margins are accretive there, but any comments on the trajectory of margins, or maybe the difference between being a supplier of components versus being a supplier of full systems? And then I'll go on to the next one. Thanks. Yeah. Hello, thank you for your questions there. I mean, as you know, we don't disclose the profitability in any dimension here. For us, it's really about the portfolio of programs that we are working with. Of course, you have some that's better and some that is less profitable. And what you see here is the average of all our different programs around the world here. So we don't go into any great detail on that, unfortunately. Okay. Okay, fine. And then just to sort of... Related to the, I think it was George from Goldman who asked the question, but, you know, you made the comment that the market share losses of the OEM, Western OEMs will persist. Obviously, there's a structural change happening in the global auto industry. The Chinese OEMs behave differently, they operate differently, they have different priorities. And I guess it's a little counterintuitive to me that if the industry is structurally changing, why the call-off will normalize back to a level where it was before? So I guess, maybe a different way of asking it is, how does call-off work in China, and is that a sort of dilutive impact? And then secondly, also, how do the Chinese OEMs impact your network and capital of the business? Thanks. Yeah, when it comes to the call-off, I mean, the call-off is very much a sign of disturbances in the value chain, be it going back here, everything from the component shortage to logistical challenges around the world to, you know, this now maybe a little bit cooling off on the EVs and so forth, uncertainty around the drivelines, et cetera. So and some specific customers have their own challenges that cause for, you know, some rapid changes here within the normal frozen period. So I'm convinced that the way back is really to improve the, for everybody's interest, is to get back to less volatility in this area. I mean, the China transition, you could say, or the growing number of Chinese OEM is not creating a call-off volatility. If you go to China and look at how they work, I mean, their predictability and stability is the same as we have seen elsewhere in the world over time. So there is not the, I would say, characteristics coming from, let's say, the newer OEMs here that create calls for higher volatility. So I just confirm what I said before. On the working capital, 'cause you tend to see much longer accounts receivable and so forth in China with businesses across different industries. That's correct. I mean, they tend to have longer payment terms than other suppliers, but we've been very clear also with our supply base that to enter into this setup and also participate in this growth, that we also need the support from our supply base, so and then that's in China. That's a very common way of working, yeah. So the net does not necessarily have to be significantly different than for our, yeah, our, the other part of our business, yeah. Okay, thanks so much. Thank you. Thank you. We will now take our next question. Please stand by, and the next question comes from the line of Trevor Young from Barclays. Please go ahead, your line is now open. Hi, thanks for taking the question. Just starting out here, I, you know, appreciate the regional drivers behind the four points of growth over market. But I was curious if you could help bucket perhaps the drivers between pricing and launches and then customer mix. Specifically, the last piece there was, you know, customer mix. Generally expected a drag from that, and I was curious, you know, how you managed to offset that, including in Americas? Yeah, I mean, so our outperformance is four percentage points, and I mean, it's not. Yeah, we're getting to smaller numbers, right? Overall. Sure. Pricing is a component of that. Also, as historically here, we will not disclose our pricing ambitions and also not the realization of pricing. It is, of course, a larger part of that outgrowth. Yeah. Well, that makes sense. Thank you. Then just as a follow-up, definitely understand the logic as to why you'd be a strong partner for Chinese OEMs seeking to expand internationally. I was just curious if you, if there was any notable distinctions to call out in what you see as your opportunity between exports from China and then volumes produced from international facilities of Chinese OEMs that they're starting to open up. Do you see any difference between the two in terms of share, in terms of content? Not really. I think it's, you know, as I said, a premium vehicle is a premium vehicle everywhere, and less content is a more basic vehicle maybe as such. So no, there is no real difference, as I said before. I mean, of course, you look at the exports have tended to be more premium so far from China EVs, but it depends on where in the world it goes to as well. So there is no general statement on that. I think there's the same ambitions as any other OEM. That's helpful. Thank you. Thank you. As there are no further questions, I would now like to hand back to Mikael Bratt for any closing remarks. Thank you, Sonia. Before we conclude today's call, I want to emphasize that we remain fully committed to achieving our targets of around 12% adjusted operating margin. Our focus continues to be on structural cost reductions, cost compensation, innovation, quality, and sustainability. The positive trends in our cash flow and balance sheet reinforce our dedication to delivering strong shareholder return. Our fourth quarter and full year earnings call is scheduled for Friday, January 31st 2025. Thank you all for joining today's call. We truly value your continued interest in our business. Until next time, drive safely. This concludes today's conference call. Thank you for participating. You may now disconnect.