Hello, and welcome to The Greenbrier Companies' third quarter of fiscal 2022 earnings conference call. Following today's presentation, we will conduct a question and answer session. Each analyst should limit themselves to only two questions. Until that time, all lines will be in a listen only mode. At the request of The Greenbrier Companies, this conference call is being recorded for instant replay purposes. At this time, I would like to turn the conference over to Mr. Justin Roberts, Vice President of Corporate Finance. Mr. Roberts, you may begin. Thank you, Sarah. Good morning, everyone, and welcome to our conference call. Today I am joined by Bill Furman, Greenbrier's Executive Chairman, Lorie Tekorius, CEO and President, Brian Comstock, Executive Vice President and Chief Commercial and Leasing Officer, and Adrian Downes, Senior Vice President and CFO. Following our update on Greenbrier's performance and our outlook for fiscal 2022, we will open up the call for questions. In addition to the press release issued this morning, additional financial information and metrics can be found in a slide presentation posted today on the IR section of our website. Matters discussed on today's conference call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Throughout our discussion today, we will describe some of the important factors that could cause Greenbrier's actual results in 2022 and beyond to differ materially from those expressed in any forward-looking statements made by or on behalf of Greenbrier. With that, I will hand the call over to Mr. Furman. Thank you, Justin. While I've had the pleasure of participating in every quarterly earnings call since Greenbrier became a public company in 1994, our IPO occurred almost exactly 28 years ago on July 14, to be exact. Today is my final earnings call after turning over the management company to our new CEO, Lorie Tekorius. I'm very pleased about all that. I'll briefly offer some comments on Greenbrier and where I believe the company has been and where we're headed under Lorie and our team. My late partner, Alan James, and I started Greenbrier in 1981. We wanted to create a company that would someday grow beyond our own skills and influence. We did. It was a remarkable journey for both of us and for Greenbrier. We purchased Greenbrier Leasing in 1981 from Commercial Metals Company for $4 million. It was located in Huntington, West Virginia at the time and owned 358 railcars, many of which were leased to The Goodyear Tire & Rubber Company. We entered manufacturing with a single facility in Portland, Oregon in 1985. Today, manufacturing operates on four continents at 12 locations. It is our largest business unit, comprising over 80% of our total revenues for the trailing 12 months. Railcar leasing and management services is our second largest core business, with assets of nearly $700 million. Since our IPO in 1994, Greenbrier's annual revenues increased from $321 million during its first full fiscal year to close to $3 billion at the end of this year. When we concluded fiscal 1994, our backlog was approximately 3,000 units with a value of $150 million. Today, our backlog is nearly 31,000 units with a value of $3.6 billion. At the time of our IPO, we managed approximately 36,000 railcars, moving up from the 358 we began with in 1981. Today, we manage over 430,000 railcars, more than 25% of the entire North American fleet. We started with an employee base of less than 10 people. Now we employ more than 15,000 employees serving global markets worldwide. Today, Greenbrier has grown to be the leading freight transportation manufacturer, supplier and service provider with a global reach that positions it for continued growth. Our ability to adapt and seek continuous improvement has led to growth and scale, is a legacy that I know the current management team at Greenbrier respects. They helped create this growth, and I know that this will continue. Lorie Tekorius, who's been part of Greenbrier for 25 years, is highly skilled at making good businesses better. She's had very serious operating experience and has a commercial background and a good, strong team in both areas as well. Lorie will continue to drive innovation at Greenbrier. She will improve its ROIC and its TSR. I expect her, and the board expects her to expand our leasing and services business, which generate stable cash flows to offset the cyclicality of new railcar demand. In closing, I'd like to say I feel privileged to have enjoyed a lengthy tenure at Greenbrier. Extended careers leading publicly traded companies today are exceedingly rare. I thank our board of directors and our shareholders for their confidence in me throughout. Mostly, I'm grateful for the personal relationships I've made with so many of the men and women who helped build Greenbrier. It's been a unique honor to have worked with so many talented and dedicated people at all levels of our business. Beyond the walls of Greenbrier, I appreciate all those I've worked with, had the privilege of working with in the communities where we operate. This includes our joint venture partners, our customers, our suppliers, advisors, bankers, equity analysts, members of Congress, others in the U.S. government and in other governments all over the world. All of these are valued relationships that enhanced our business, and they also enriched my life in countless ways. To all of you on today's call, I wanna thank you for our association. I'm grateful for the opportunity to represent Greenbrier today in other settings. With some wistfulness, but not regret, I leave my time as a Greenbrier executive officer with a sense of accomplishment, and certainly there's unfinished business. I know that not all business can ever be finished. Going forward, my role will be in the boardroom, helping Lorie and her team grow Greenbrier for generations to come. I won't be on the board for generations to come, only for 2023. As a fellow investor, I look forward to listening to these calls along with you in future quarters. There is no doubt in my mind that you will be hearing great things from Lorie and from Greenbrier as we move ahead. Thank you, Lorie, over to you. Thank you, Bill, and good morning, everyone. I appreciate you joining us today for a review of our operating results and our perspective on market conditions. Before I discuss the quarter, I'd like to thank the men and women of Greenbrier who work hard to serve the rail freight industry everywhere we operate. I am proud to lead such a fine group that's integral to the movement of essential commodities and provides the foundation for Greenbrier to address our customers' needs through innovative equipment and services. Now turning to the quarter, I'm pleased that Greenbrier delivered solid operating results. The value of our integrated business model was clearly demonstrated by the meaningful impact of our leasing platform, including strong syndication activity during a quarter that was characterized by a rapidly changing macroeconomic landscape. Likewise, our maintenance services business continued to gain momentum. The dilutive impact of pass-throughs of input cost escalations and reduced production in Europe due to the impacts from the war in Ukraine were headwinds to margins. Despite these headwinds, our aggregate gross margins trended up $21.5 million or 39% sequentially as we move through the second half of our fiscal year. In our core North American market, railcar production increased. This required a workforce expansion of over 1,500 people while successfully contending with a volatile supply chain. Overall, the manufacturing leadership team performed well with sequential margin improvement of $19 million or 91% during one of the more complicated production ramps in our history. In Europe, the war triggered a slowdown in production and a pause in order activity after securing orders for 2,300 railcars in the first half of our fiscal year. Europe's economy is recalibrating to the realities of the continuing conflict, with the impact being felt across the value chain. Pricing and availability of critical materials such as steel have improved, albeit not to pre-war levels, and customers are returning to the market. In maintenance services, strong volumes led to improved profitability. We continue to gain momentum as the action plan we implemented to increase efficiencies in our repair facilities improves our results. Across the economy, uncertainties regarding inflation, interest rates, commodity prices, and supply chain issues have raised recession fears. At the same time, unemployment is low, wages are rising, and consumers still hold meaningful savings accrued over the pandemic. It's times like these when the strength and significant experience of our leadership team and the flexibility of our business model produce strong, steady results. As we enter the final quarter of our fiscal year, we're encouraged by our momentum and invigorated to finish the year strong. We believe the current challenges in the North American rail system, like network congestion, present opportunities for our business in the months ahead. Strong customer inquiries and shipper outlook are encouraging indicators of future order activity and leasing performance. Our backlog is diversified among a variety of railcar types and extends well into calendar 2023. Finally, I'm confident in our team's ability to execute in any type of market condition. With that, I'll turn it over to Brian to discuss railcar demand environment and our leasing activity. Thanks, Lorie, and good morning, everyone. In Q3, Greenbrier secured new railcar orders of 5,000 units valued at $670 million. With deliveries of 5,200 units in the quarter, our book-to-bill ratio was nearly 1. We maintain our market-leading position in North America. At the end of calendar Q1, orders for Greenbrier comprised 48% of the total North American industry backlog. Our diversified backlog currently stands at nearly 31,000 units with a total value of $3.6 billion. Customer inquiries remain high and we see ongoing industry investment from all categories of customers. According to FTR Associates, new railcar deliveries are expected to be 42,000 units and 53,000 units in 2022 and 2023 respectively. Total railcars in storage are approximately 286,000 units, levels last seen in 2018. Scrap cars are expected to exceed new railcar deliveries for the third consecutive year, causing the North American fleet to shrink. The combination of a shrinking fleet and decreased railcars in storage increases railcar utilization and adds pressure on fleet availability in North America. As a reminder, our new railcar backlog does not include 3,100 units valued at more than $220 million that are part of Greenbrier's railcar refurbishment program. Our refurbishment program is an important part of ensuring rail remains the most environmentally friendly mode of surface transport. Importantly, we continue to operate in a strong North American leasing market for new originations and lease renewals. This validates the significant expansion of our lease fleet over the last 18 months. Our leasing team continues to perform ahead of expectations as we scale this business with an owned fleet totaling 11,800 railcars at the end of the quarter. Lease pricing on renewals has increased into the double digits in fiscal 2022, while fleet utilization remains strong at 98%. We are very focused on protecting our economics through our lease agreements by hedging our debt balances to factor for inflation and rising interest rates. During the quarter, we fixed our remaining leasing term debt to its maturity date of August 2027. Syndication activity in Q3 totaled 800 units, maintaining our strong activity this year with our partners. As a reminder, syndication revenue is the additional revenue in excess of what is derived from a new railcar sale that is created from the sale of a new railcar with a lease attached. Beginning in Q1 of fiscal 2022, we sought to demonstrate our enhanced leasing strategy in our financial reporting by moving syndication revenue from manufacturing to our leasing segment. This aligns revenue dollars with the syndication activities performed by our capital markets group who work in leasing. This change also reflects our commitment to monitor overall margin dollars and percentages by segment. Growth of Greenbrier's consolidated margin is, of course, our end goal. Greenbrier's management team is experienced and our business model is flexible. We are energized and optimistic about our ability to serve our customers and perform well in our markets. This leaves us well positioned to successfully navigate these next two stages of recovery from the pandemic and the prevailing forces at work in the economy at any particular time. Adrian will now speak to the highlights in the third quarter. Thank you, Brian, and good morning, everyone. Today, I will discuss highlights from our third quarter. I'd like to remind our listeners today that quarterly financial information is available in the press release and supplemental slides on our website. I will provide additional color at the close of my remarks as we are refining fiscal year 2022 guidance today. Items of note in the third quarter include aggregate gross margins of 9.6% reflect higher deliveries and improved operating efficiencies in manufacturing and maintenance services. Headwinds in Europe as a result of the war in Ukraine and passthrough of input cost escalations partially offset the improved efficiencies by approximately 200 basis points. As a reminder, the passthrough of input cost escalations increase our revenues, safeguard our gross margin dollars, but are dilutive to gross margin percent. Selling and administrative expense of about $57 million is higher sequentially, reflecting increased employee-related costs, consulting, and travel expense from increased business activity. Interest expense of about $15 million is a result of higher borrowings and increases in interest rates on our floating rate revolving facilities. In the quarter, we also recognized $1.1 million of gross costs specifically related to COVID-19 employee and facility safety. This is approximately 47% lower than Q2, in line with reduced impact from COVID. Greenbrier's liquidity of $535 million at the end of Q3 consisted of cash of $450 million and available borrowings of $85 million. The sequential reduction reflects increased working capital, an increase in leased railcars held for syndication, and reduced borrowing capacity resulting from the sale of legacy lease fleet assets in Q2. In Q4, we expect liquidity will grow due to higher levels of cash from improved operating results, stabilization of working capital, and increased borrowing capacity resulting from more railcars placed on our balance sheet during Q3. Our debt's weighted average maturity is about five years with an average interest rate below 4%. Because of the strength of our balance sheet, we are confident in our ability to navigate the volatility of the current market. As highlighted in prior quarters, we expect to receive a large portion of our $106 million tax receivable in fiscal Q4. However, this could occur later due to processing delays at the IRS. This refund is an addition to Greenbrier's available cash and borrowing capacity. Today we announced that Greenbrier's board of directors declared a dividend of $0.27 per share, our 33rd consecutive dividend. Based on Friday's closing price, our annual dividend represents a dividend yield of approximately 3.3%. Since reinstating the dividend in 2014, Greenbrier has returned over $385 million of capital to shareholders through dividends and share repurchases. Based on current business trends and production schedules, we're adjusting Greenbrier's fiscal year 2022 outlook to reflect the following. We are increasing the low end of our deliveries guidance. Our updated fiscal year 2022 deliveries guidance is 18,500 units-19,500 units, which includes approximately 1,500 units from Greenbrier-Maxion in Brazil. As a reminder, in fiscal 2022, approximately 1,700 units are expected to be built and capitalized into our lease fleet. This is an increase of about 300 units from our prior guidance and is reflected in the modestly higher leasing capital expenditure guidance for the year. These units are not reflected in the delivery guidance provided. As a reminder, we consider a railcar delivered when it leaves Greenbrier's balance sheet and is owned by an external third party. Selling and administrative expenses are expected to be approximately $210 million-$215 million for the year. Gross capital expenditures of approximately $310 million in leasing and management services, $50 million in manufacturing, and $10 million in maintenance services. Net of proceeds from equipment sales of $155 million, leasing CapEx is expected to be $155 million. Gross margin percent is expected to increase sequentially in Q4, with margins expected to be between low double digits and low teens. Before we head into the Q&A portion of the call, I would like to reiterate a few of the key takeaways. Greenbrier is supported by a robust backlog, which provides strong earnings visibility. Anchored by an agile and experienced management team, Greenbrier will continue to successfully navigate the challenges we have faced during our fiscal year. Our liquidity and balance sheet strength protects our business during volatile times and positions us to be opportunistic when the right opportunities present themselves. As we look to strongly finish our current fiscal year, we are well positioned to drive shareholder growth and value entering fiscal 2023. Now we will open it up for questions. Sarah? We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the key. To withdraw your question, please press star then two. Please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. Our first question comes from Justin Long with Stephens. Please go ahead. Thanks. Good morning. Bill, since this is the last call, just wanted to say congratulations again on a great run. Thank you. Thank you very much. Enjoyed working with you. Same here. Adrian, maybe to just follow up on the comment you made about fourth quarter gross margins on a consolidated basis being in that low double digit to low teens range. Can you provide a little bit more color on the manufacturing gross margins that you're assuming in the fourth quarter within that guidance, and maybe speak to the difference you're seeing in North American gross margins versus European gross margins right now, given some of the disruptions you referenced? Yeah. As you might imagine, the North American gross margins are quite a bit higher than Europe. That would continue into Q4. As you might expect with that level of increase in consolidated margins, it would be driven primarily by improvement in North American manufacturing margins as well. You would you know look to see manufacturing margins you know in the double digits as well. Okay. That's helpful. In terms of order activity, I know you talked about European activity for new railcars picking back up, but I just wanted to be clear, are you seeing orders from Europe quarter to date? Overall, as you think about order activity quarter to date, how would you say that it's tracking relative to the 5,000 orders that you just posted in fiscal second quarter? Hey, Justin, this is Brian. I'll take that. I'll start with North America. In North America, the cadence continues to be very similar to what we've seen over the last couple of quarters. We haven't seen any appreciable slowdown at this stage, and things look good. We're off to a pretty good start here in the quarter. For Europe, now that things are settled in and there's a bit of normalcy, as much as there can be in Europe, we're starting to see customers come back to the table, and we have began to secure orders again. You know, it's starting to stabilize a little bit over there as well. Okay. Helpful. I'll leave it there. I appreciate the time. Our next question comes from Matt Elkott with Cowen. Please go ahead. Good morning. Thank you. I want to reiterate congratulations to Bill on the accomplishments over the last few decades here. Great working with you all this time. Staying on the Europe front, did you guys mention how many deliveries you had in Europe in the quarter and how many deliveries in the fourth quarter? We did not explicitly get into that. I would say that there were less than 1,000 cars delivered in fiscal Q3, and we would expect something similar in fiscal Q4. This is a pretty significant step down from where we were at pre-war from a expectations perspective. Okay. Got it. So we should expect that barring any, you know, unexpected macro and geopolitical developments, should we expect that to ramp up to normal levels next year? I think that's the plan, and that's what we're working towards at this point. We have seen that. I would reiterate, it is a fluid environment and some important negotiations with customers to get completed, but at the end of the day, that's what we see. It is a very challenging environment over there where everybody is basically experiencing pain. Yeah. Understood. Justin and Brian, probably, has the mix of orders changed in North America? I mean, the recovery so far in the last two years has been driven mostly by freight cars, but it seems like the tank car market, on the leasing side at least, is tightening a bit in recent months, so should we expect that to eventually hit manufacturer orders? Then the other way I'd like to see if the order mix has changed, has the mix of buyers changed more in favor of shippers and railroads as opposed to lessors? Because it seems to me like if you're a lessor, the return dynamics or, you know, additions to the fleet don't seem super compelling right now given equipment costs and interest rates going up. Yeah. This is Brian, Matt. All good questions. We have been seeing this year, and I think we'll continue to see that the predominant buyers in the marketplace are shippers. A lot of our leasing activity that we're originating is going directly to shippers, as well as we're seeing more product being purchased by shippers as well. As far as the mixed question goes, we're continuing to see pretty much the same diverse mix of product. You know, it's everything from boxcars to covered hopper cars. There is still a nice tank car undertone that's been keeping us very busy, and a number of other car types as well. Okay. You know, that's very helpful. Back on the shipper versus lessor side, I guess you really haven't seen much large orders by lessors. What do you think it will take for that to change? I mean, many lessors are looking at utilization rates in the nineties, some in the high 90s. Yeah. Do you think? Yeah, go ahead. Yeah. I think you're at that inflection point now. I think, you know, as commodity prices begin to moderate, which we're seeing, you know, hot rolled coil, plate is still standing pretty strong, but hot rolled coil is coming down. We're seeing signs of, you know, the scrap surcharges are starting to ease a bit. And you do have operating lessors that have an investment appetite that have been sitting on the sidelines. I think we're basically hitting that inflection point now. A little bit of moderation in commodities will bring them back. As you said, very high utilization rates and a shrinking fleet is putting a lot of pressure on demand. Great. Thank you very much. Our next question comes from Allison Poliniak with Wells Fargo. Please go ahead. Hi. Good morning. Bill, congrats myself to you. You certainly left Greenbrier in good hands with Lorie and team there, so best of luck. I just wanna go back, I think, Lorie, with your comment on rail congestion. You know, certainly it's been a benefit to cars, and one of the concerns out there is as congestion starts to ease, maybe that starts to loosen the supply network up a little bit. Just any thoughts on how you're viewing that. Is there a strong enough underlying demand to continue sort of this path on new car interest here? The short answer is yes, I do think so. I think as the congestion eases, that's gonna allow a lot of folks to really put their focus back on shipping commodities via the rail, where maybe they've pulled back a little bit during the supply chain difficulty and with some of the congestion. You know, rail transportation is the most efficient. It's got the lowest carbon footprint, so there's a lot of desire to move more product via the rail. The railroads themselves just need to sort through this congestion issue, which, you know, I think we're all reading in the papers that it's impacting all of us, right? It has to do with labor shortages, the timing of things. It just takes a little bit to get this all worked out. I do know that the railroads are very focused on figuring out how they can sort through this. All that being said, I think there will be continuing demand. May not be kind of going to some of the high driving up peaks and dropping back down. Congestion is one of those things that, as we all know, it cuts two ways, right? As we incur a bunch of congestion, it could increase costs or it could cut costs. That's. I think it's gonna be an area where we continue to see demand. Oh, that's great. Thanks. Just leasing. I might have missed this, but, you know, obviously double digit, I think you mentioned renewed lease rates. Where are we with term? Are you starting to see that extend in terms of the terms of the leases at this point, or are we still early stages there? Just any color. No, we've. It's a good question, Allison. This is Brian. We've seen now for the past few quarters really extended terms on a lot of these transactions. Quite frankly, we're pushing extended terms given where interest rates and things are. Yeah, I would say that terms, quite frankly, are much more extended than they've been in quite some time. Great. Thank you. Our next question comes from Bascome Majors with Susquehanna. Please go ahead. Going back to the customer questions from earlier, can you talk a little bit about the syndication channel, you know, how your core customers there are faring, and what their response has been to an environment of higher asset prices and higher interest rates? Yeah. You know, the syndication channel, first off, has been very liquid, and we continue to have great partners working in that aspect. As it relates to higher equipment costs and interest rates, at the end of the day, you know, we always have to have those conversations. You know, the people that we transact with are, you know, they understand what's going on. They understand what's happening in the interest rate world. They see it on their mortgages, they see it in their everyday world, and so they can translate that into the additional costs expected. We have not seen any failure to get or to pass through any of those costs at this point. If I could just add one thing. I mean, with the rise in interest rates, the rise in asset prices, there's also a rise in lease rates, and so our syndication partners are generating stronger lease returns as well. Yeah. It's also bringing up the value of existing fleets, right? We're talking, we're very focused around right now what's being produced right now, but as some of these partners have larger fleets, they're seeing as renewals come up, we're also seeing that benefit in the renewals of some of their existing fleets. You know, to that point, you know, you have historically, at least in recent years, shown some level of seasonality with the syndication cadence, and it's typically been a bit heavier in the fourth quarter. It's hard to tease that specifically out of the guidance the way it's said, but, I mean, but are you seeing that? Is there anything that would keep that typical or at least recently typical 3Q to 4Q bridge of higher deliveries a little more muted this time? Just trying to dig through that. Thank you. Sure. I think that, you know, it's a matter of seasoning some of the assets that are on our balance sheet. It's also a matter of when those cars are being built in our manufacturing facilities. As we mentioned earlier, we have been ramping up production. From a sequential basis, you may see a little bit more, but that's not because we're just holding it for the fourth quarter or something like that. It's just related to our levels of production and the timing of when some of our partners would like to take those assets. Thank you for that. As we look in the next year, obviously there's not a lot of incentive to get super precise given the uncertainties globally in a lot of different regions and businesses that you operate in. But, you know, as we think about the run rates into 2023, can you give us a little color on a few things you have visibility into, whether it's the backlog that's scheduled for fiscal 2023 delivery, SG&A, you know, reversals in some of the working capital build? Just anything we can think about to kind of bookend the range of outcomes in our models would be really helpful. Thank you. Sure. I'll give a little bit of color there. As I think everyone has mentioned in their prepared remarks, we do feel very comforted by the large backlog that we have. It allows us to have production schedules that go out well into calendar 2023 to give us an idea of how we'll be able to build. We are being mindful to not, again, have a large run up and then be having to pull back on our workforce. Having a steady workforce, having steady production is one of those things that helps us to drive more efficiency through the manufacturing process. When it comes to SG&A and even some of the manufacturing, as well as our other businesses, we all know that, you know, inflation is here. We're having those impacts, particularly within our workforces. We're very mindful of making certain that we are paying attention to retaining the talent that we have. That will require some additional employee-related costs. Interest rates have gone up. I think the team has done a great job of locking in with hedging at lower rates than what you might see in today's market, but they're definitely higher than what we've had historically. I think overall, as I think about our fiscal 2023, I should say, while we're not gonna be giving explicit guidance, we do see kind of, you know, maybe what might be a little bit of a nice, sweet steady ramp up and staying at some sort of a steady basis, which would be, I think something the entire manufacturing group would enjoy across our industry. It sounds like you mentioned working capital. I'm sorry, go ahead. You mentioned working capital as well. You know, working capital tends to lead into the higher production rates. As our, you know, as we finish our ramp up, you know, we should see some efficiencies in our working capital. As we see some commodity prices moderating or declining, again, we would expect that to be favorable to our working capital and, you know, drive cash as that reduces next year. A lot of uncertainty there, obviously, but, you know, I think with what we see today, we would expect to see some improvements there. Thanks for touching that. Thank you, all. My next question comes from Ken Hoexter with Bank of America. Please go ahead. Great. Good morning. Bill, I'll echo the congrats on forming a great company and the job you've done. It must have been a great stay at The Greenbrier to have the name stick all these years. Maybe I'll go. I don't know if it's Lorie or Adrian, but on the margins impacted by 200 basis points you mentioned on supply chain and gross margin pressure. Maybe talk a bit about where I think you were targeting maybe low teens into the third quarter and certainly into next quarter. Maybe talk about where it missed internally to get there? Was that supply chain costs? Was that other costs? Was that the pricing not keeping pace with the inflation cost? Maybe just talk us through some of the cost side there. Hey, Ken, this is Justin. Just to clarify, I think last quarter we spoke to kind of low double-digit to low teens in Q3 into Q4. If you're gonna take the 9.6% consolidated and add back the 200, that gets you into kind of 11.5%, which gets us into that low double-digit range. I think we ultimately felt like we accomplished quite a bit and did what we guided to last quarter. It just was. There's definitely some headwinds out there, especially from the escalations in European activity. Fortunately, we do see that there's enough upside and efficiencies that we're gaining in North American manufacturing that we'll see further improvement in Q4 and going forward. Okay. It sounds like the lease fleet climbed a little bit on the balance sheet versus the total build. You lifted the bottom end of your build range, kept the top end. It looks like you've kept more on the balance sheet despite what's going on in Europe. If we've got a book-to-bill that fell down to 1.0, lease utilization falling, maybe just give your view on, you know, it sounds like Lorie talked a lot about the congestion at the railroads and obviously increased demand. What is your feeling on the state of the market now? I would say our feeling on the state of the market is cautiously optimistic, and we are seeing a lot of things that when you get deeper beyond just the headlines that you see, we see demand by a number of shippers to add equipment to the rails to be able to ship more products via the rails. We are seeing, you know, that sort of steady encouraging improvement. On lease fleet utilization, I don't think we had a drop off. I think we've stayed steady at 98% utilization. I think that is just another indicator that the market is using all the equipment that they can that's out there. Once there's a bit better fluidity on the rails, you're likely going to see more equipment being brought in. The other thing that goes on is you've got some equipment that's probably aged out, is inefficient, and so as is possible, that'll probably continue to get scrapped and moved into more efficient, rail equipment. That's one of the things that we enjoy working with a lot of our customer partners on, is innovation on, designs of rail cars that are, improved technology. Hey, Ken, this is Brian. On the lease fleet utilization, I just want to hit on one point. With a fleet size of 11,800 cars, it doesn't take many cars to change a percentage or two. A lot of those leases are transitioning from one lease to another. They're not necessarily in storage. It's, you know, they're going from one customer to another, and they have to go through shop and get repaired. When you look at 98%, we really feel like we're as close to 100% as we could be, just given the dynamics of how leasing works. Ken, we did. So maybe- We did talk about. Go ahead. increasing the low end of our deliveries guidance, and deliveries are sales to third parties. The additional investment in our lease fleet that we talked about, what's gone onto our balance sheet is separate from those deliveries. Yeah. It's not driving those deliveries. Yeah. Right. No, I know. That's why I was. It seemed like an encouraging statement if you're lifting the bottom end and putting more into the lease fleet. So just maybe to follow up on that, if I can, you know, it seems like you talked about pricing keeping pace with inflation as your pass through. Typically, we've seen. You talked about earlier the values written in a rising rate environment on your fleet value. I think in the eighties you had, maybe this is more of a Bill question, but you had tax benefits that encouraged investment. You know, what's the environment like today? Is this just more, kind of just straight demand? Is there any encouragement in a rising rate environment where you see a focus more on subscribing for assets? This is Brian. You know, the demand is really demand driven. It's we're not seeing you know, people coming in necessarily for the investment, although the investments are good and our syndication partners are happy with the returns. The orders that we're seeing are for either expansions or replacement cars you know, as the fleet contracts. It is demand driven. All right. Appreciate the time, everyone. Thank you. Again, if you'd like to ask a question, please press star then one. Our next question comes from Steve Barger with KeyBanc Capital Markets. Please go ahead. Hey, good morning, everyone. Bill, congratulations to you. I hope you have a great next chapter. Thank you very much. Appreciate it. You bet. Several of you kind of mentioned the chaotic macro environment. A lot of questions have been directed that way. You all still sound cautiously optimistic, and I think Brian said inquiry activity is still good. Just to ask the question directly, are your customers talking about recession or expressing fears that their own business is set to decline? You know, I think everybody's got an eye on the finish line, and everybody's being smart about what they do. Our customers, you know, aren't necessarily focused on recession as much as they're focused on trying to get their product to market. As you know, the truck market is pretty congested. They're having issues. The rail velocity is congested, and so there's still a lot of supply chain constrictions. That's really what people are focused on, is how do we get our product to market and how do we grow share on rail? Unfortunately, as Lorie said earlier in her comments, it's being restricted at this point. Right. Well, with, you know, the inflationary pressures that you've talked about, new car pricing is higher. Have you booked cars so far in Q4? Yes. Great. Adrian or Justin, going back to the margin conversation, or maybe more importantly, gross profit per car. I hear you on feeling like you accomplished a lot this quarter, given the challenges, but I think it's fair to say that year-to-date manufacturing results have been falling short of how we and probably you were thinking about it at the start of the year. Can you just be more specific on what drives that improvement going forward? Yeah. I think I'll start and then Adrian can correct me where I'm wrong or fill in any gaps. I think a big piece is. Well, one, I would say yeah, it's been a challenging year, and I think more challenging than when we started six months ago or even. I'm sorry, probably closer to 10 months ago. A production ramp of this size and magnitude is challenging in and of itself. When you layer in the challenges of the supply chain and Delta and Omicron variants in the first six months of the year, it really created a very chaotic, challenging environment. Now, what we see going forward and what we've started to experience in Q3 is the actual efficiencies start to manifest. As you're increasing your production, you're absorbing more overhead and you're reaching those stabilized production rates, that allows more profit to fall through to the margin and therefore bottom line. I mean, we're seeing that manifesting. Then especially down in Mexico, where much of the ramp is occurring, you see substantial improvements each quarter sequentially and into the fourth quarter. Well, we see it. You don't necessarily see those specific facilities, but you will see that flow through on the margin line. Got it. I know that orders have been kind of lower volume, higher mix, which has its own challenges as well. Are those line changeover issues more behind you as well? I think the pricing was supposed to get better. Is that starting to flow through? Before Brian jumps in, I would say yeah. I mean, I think as we looked at this fiscal year earlier on, we expected, as Justin said, some of the ramping to occur a little bit sooner than what had actually occurred because of things like supply chain, COVID and the impact on bringing back a workforce. I think our manufacturing team has done an amazing job of bringing back that workforce. It just took us a little bit longer to get that traction. Yeah, no, I agree, Lorie. You nailed it. We're just, you know, we're a little bit behind in the ramp ups, but the ramp ups are nearly behind us. Pricing continues to improve and yeah, looks good. I think the crazy thing is, you know, we're pleased that in our contracts we do have the pass-throughs of cost escalations, which does, I think, as Adrian said, tried to be very clear about this, which it drives an increase in revenue, but is a headwind to margin percentage because while our focus is on margin percentage, it's also focused on margin dollars. We're keeping those margin dollars neutral, but math just recreates a headwind to margin percentage. No, I understand that. You look at the revenue per car this quarter and the gross profit per car and you're still kind of trailing where, you know, historically you have been. Fair enough. I think Europe was a big piece of that as well, when you look at those manufacturing margins. Understood. Thanks. This concludes our question and answer session. I would like to turn the call back over to Mr. Justin Roberts for any closing remarks. I just wanted to say thank you very much for your time and attention today. If you have any follow-up questions, please reach out to me at either justin.roberts@gbrx.com or through our investor relations email. With that, I hope everybody has a great July. Have a great day. Thank you. Thanks, everyone. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.