1 00:00:07,600 --> 00:00:10,560 Speaker 1: Hi everyone, this is Lee Clascow when We're Talking Transports. 2 00:00:10,640 --> 00:00:14,120 Speaker 1: Welcome to Bloomberg Intelligence Talking Transports podcast. I'm your host, 3 00:00:14,200 --> 00:00:18,160 Speaker 1: Lee Claskows, Senior Freight Transportation Logistics SILES at Bloomberg Intelligence, 4 00:00:18,360 --> 00:00:21,000 Speaker 1: Bloomberg's in house research arm of almost five hundred analysts 5 00:00:21,040 --> 00:00:24,360 Speaker 1: and strategists around the globe. A quick public service announcement 6 00:00:24,400 --> 00:00:27,680 Speaker 1: before we dive in. Your support is instrumental to keep 7 00:00:27,680 --> 00:00:30,640 Speaker 1: bringing a great guest and conversations to you our listeners, 8 00:00:30,840 --> 00:00:33,680 Speaker 1: and we need your support. So if you enjoy this podcast, 9 00:00:33,720 --> 00:00:35,720 Speaker 1: share it, like it and leave a comment. Also, if 10 00:00:35,720 --> 00:00:38,160 Speaker 1: you got ideas, feedback, or just want to talk transports, 11 00:00:38,280 --> 00:00:40,320 Speaker 1: I'm always happy to connect. You can find me on 12 00:00:40,360 --> 00:00:43,840 Speaker 1: the Bloomberg terminal, on LinkedIn or on x at Logistics. Lee. 13 00:00:44,479 --> 00:00:47,440 Speaker 1: I am very excited to have with us toite Lori Tachorius, 14 00:00:47,600 --> 00:00:51,400 Speaker 1: the Greenbrier Company CEO and President. The company trades under 15 00:00:51,400 --> 00:00:53,720 Speaker 1: the ticker at GBX and as a market cap around 16 00:00:53,800 --> 00:00:57,120 Speaker 1: one point eight billion dollars. Since joining Breenbrier in nineteen 17 00:00:57,160 --> 00:01:01,320 Speaker 1: ninety five, Laurie has held roles of increasing response including CFO, 18 00:01:01,600 --> 00:01:05,440 Speaker 1: COO and President, in addition to Greenbrier Board of directors. 19 00:01:05,720 --> 00:01:09,000 Speaker 1: Laurie is also a board member of Alamo Group and 20 00:01:09,080 --> 00:01:13,280 Speaker 1: recently joined the Portland Branch Board of Directors of the 21 00:01:13,280 --> 00:01:17,880 Speaker 1: Federal Reserve Bank of San Francisco. Welcome to talking transports, Lori, 22 00:01:17,959 --> 00:01:18,880 Speaker 1: thanks so much for joining. 23 00:01:19,160 --> 00:01:21,040 Speaker 2: Well, thank you lead, thanks for having me. It's great 24 00:01:21,040 --> 00:01:21,800 Speaker 2: to be here today. 25 00:01:22,000 --> 00:01:24,959 Speaker 1: So Greenbrier it's a public company. It's a pretty interesting 26 00:01:25,000 --> 00:01:27,880 Speaker 1: company because you kind of straddle a bunch of different things. 27 00:01:27,959 --> 00:01:31,200 Speaker 1: Can you give us a little background about Greenbrier? 28 00:01:31,600 --> 00:01:35,280 Speaker 2: Sure, happy to do that. So Greenberg is a leading 29 00:01:35,360 --> 00:01:40,520 Speaker 2: equipment and services provider for global bright transportation. So that 30 00:01:40,680 --> 00:01:45,360 Speaker 2: means that we design, we build, and we market railcars 31 00:01:45,400 --> 00:01:49,440 Speaker 2: for freight transportation from the North American market. We also 32 00:01:49,520 --> 00:01:52,840 Speaker 2: do this in Brazil and in Europe as well as 33 00:01:52,960 --> 00:01:57,680 Speaker 2: for the Middle East. In addition to designing and building railcars, 34 00:01:58,080 --> 00:02:01,040 Speaker 2: we have a small sleep of railcars that we own 35 00:02:01,120 --> 00:02:04,880 Speaker 2: that we lease out here in North America. So, as 36 00:02:04,880 --> 00:02:08,280 Speaker 2: you said, we really do service the broader great transportation 37 00:02:08,400 --> 00:02:12,200 Speaker 2: market via rail. We started out in nineteen eighty one 38 00:02:12,840 --> 00:02:16,560 Speaker 2: as really a small leasing company and then quickly pivoted 39 00:02:16,639 --> 00:02:21,120 Speaker 2: to getting into the manufacturing space. And I would say 40 00:02:21,520 --> 00:02:24,560 Speaker 2: over my thirty plus years now with Greenbrier, we've been 41 00:02:24,600 --> 00:02:28,760 Speaker 2: on an interesting journey to not only grow our footprints, 42 00:02:29,680 --> 00:02:33,960 Speaker 2: but also to expand our product offering. Where when I 43 00:02:34,040 --> 00:02:39,239 Speaker 2: first started with Greenbrier, we're primarily intermodal and forest products 44 00:02:39,680 --> 00:02:44,400 Speaker 2: railcar producer. Now we've pretty much produced anything for the 45 00:02:44,400 --> 00:02:48,240 Speaker 2: North American market. So that's what's really exciting, as well 46 00:02:48,240 --> 00:02:51,720 Speaker 2: as expanding into Europe, the Middle East and Brazil. 47 00:02:52,080 --> 00:02:54,120 Speaker 1: And then you know, you mentioned all these different regions 48 00:02:54,120 --> 00:02:58,240 Speaker 1: that you're in as US the overwhelming majority of your business. 49 00:02:58,480 --> 00:03:00,720 Speaker 2: It is the majority of our business because when you 50 00:03:00,760 --> 00:03:04,160 Speaker 2: think about the world and you think about where there 51 00:03:04,200 --> 00:03:07,960 Speaker 2: are rail lines the north end. Being a US public company, 52 00:03:08,480 --> 00:03:11,160 Speaker 2: North America is the biggest market that we can serve. 53 00:03:11,560 --> 00:03:14,160 Speaker 1: And you know, as a public company, do you guys 54 00:03:14,160 --> 00:03:17,000 Speaker 1: go out with any financial targets for twenty twenty six 55 00:03:17,639 --> 00:03:19,520 Speaker 1: or any long term targets that you might have that 56 00:03:19,600 --> 00:03:20,160 Speaker 1: you want to share. 57 00:03:20,480 --> 00:03:23,639 Speaker 2: Sure, thank you for asking. Several years back, we had 58 00:03:23,680 --> 00:03:28,760 Speaker 2: our very first ever investor day where we set several targets. 59 00:03:28,800 --> 00:03:33,680 Speaker 2: One was to double our recurring revenue in five years. 60 00:03:33,720 --> 00:03:37,480 Speaker 2: And so when we started, which was in twenty twenty three, 61 00:03:37,640 --> 00:03:40,240 Speaker 2: we were at about one hundred and thirteen million on 62 00:03:40,400 --> 00:03:43,840 Speaker 2: a last twelve month basis. As we finished our fiscal 63 00:03:43,880 --> 00:03:46,960 Speaker 2: twenty twenty five, we're about halfway there at two hundred 64 00:03:46,960 --> 00:03:50,160 Speaker 2: and twenty five million. Again, that's where we're growing the 65 00:03:50,280 --> 00:03:53,680 Speaker 2: lead inside of our business because the new rail car 66 00:03:53,800 --> 00:03:56,760 Speaker 2: site can be a bit cyclical, so growing our loosing 67 00:03:56,920 --> 00:04:01,720 Speaker 2: business allows us to bring some more predictable and repeatable 68 00:04:01,720 --> 00:04:06,160 Speaker 2: revenues into our organization. We also set a target for 69 00:04:06,400 --> 00:04:10,880 Speaker 2: aggregate growth margins being in the mid teens. Excited to 70 00:04:10,920 --> 00:04:14,320 Speaker 2: say that we achieved that with eighteen point seven percent 71 00:04:14,400 --> 00:04:17,400 Speaker 2: at the end of fiscal twenty twenty five. And then 72 00:04:17,400 --> 00:04:21,000 Speaker 2: we also have a return on invested capital or goal 73 00:04:21,160 --> 00:04:24,320 Speaker 2: of ten percent, which again at the end of FY 74 00:04:24,400 --> 00:04:26,280 Speaker 2: twenty five or at ten point nine percent. 75 00:04:26,760 --> 00:04:30,680 Speaker 1: And your growth over the years has been predominantly organic 76 00:04:30,800 --> 00:04:33,200 Speaker 1: or do you guys go out and buy things? 77 00:04:33,839 --> 00:04:37,279 Speaker 2: I would say mostly organic, But we have made some 78 00:04:38,360 --> 00:04:45,320 Speaker 2: investment and some acquisitions. So in Europe we set up 79 00:04:45,320 --> 00:04:47,960 Speaker 2: a joint venture with a company that was called Astra, 80 00:04:48,440 --> 00:04:51,240 Speaker 2: and that was back in twenty seventeen where we join 81 00:04:51,520 --> 00:04:54,159 Speaker 2: created a joint venture with our partner over there. We 82 00:04:54,240 --> 00:04:58,360 Speaker 2: have seventy five percent and he has twenty five percent, 83 00:04:58,400 --> 00:05:01,960 Speaker 2: so that's a joint venture of our facilities in Poland 84 00:05:02,440 --> 00:05:07,120 Speaker 2: and Romania. And then in twenty nineteen, we did actually 85 00:05:07,160 --> 00:05:10,240 Speaker 2: our largest acquisition, which was a company by the name 86 00:05:10,279 --> 00:05:13,840 Speaker 2: of American Rail Clark and they have two new car 87 00:05:14,160 --> 00:05:17,480 Speaker 2: production facilities in Arkansas as well as a number of 88 00:05:17,480 --> 00:05:21,000 Speaker 2: support facilities. So that was the largest acquisition we had done. 89 00:05:21,279 --> 00:05:26,160 Speaker 2: Again close in August of twenty nineteen, so fortunately or 90 00:05:26,279 --> 00:05:28,320 Speaker 2: unfortunately just before the pandemic. 91 00:05:28,720 --> 00:05:32,920 Speaker 1: So you know, so you're a manufacturer, you're a leasing company, 92 00:05:33,279 --> 00:05:38,720 Speaker 1: so you probably attract various investors, whether it's people that 93 00:05:38,760 --> 00:05:41,960 Speaker 1: invest in financial companies or people that invest industrial companies. 94 00:05:42,240 --> 00:05:44,840 Speaker 1: So what because of that combination, what do you think 95 00:05:45,000 --> 00:05:47,280 Speaker 1: the street gets wrong about Greenbrier? 96 00:05:47,720 --> 00:05:50,560 Speaker 2: Very astute question, because it is a little bit different 97 00:05:50,640 --> 00:05:56,520 Speaker 2: being both a manufacturer and a leasing Company's stepping back, though, 98 00:05:56,520 --> 00:06:00,360 Speaker 2: I think one of the things that people misunder stand 99 00:06:00,400 --> 00:06:04,600 Speaker 2: about Greenbrier and the industry is that rail is still 100 00:06:04,640 --> 00:06:05,040 Speaker 2: a thing. 101 00:06:05,560 --> 00:06:05,720 Speaker 1: Right. 102 00:06:05,800 --> 00:06:07,919 Speaker 2: A lot of people when I meet them for the 103 00:06:07,920 --> 00:06:10,600 Speaker 2: first time and they learn what I do or what 104 00:06:10,680 --> 00:06:14,359 Speaker 2: Greenbrier does, and they say, great, rail, that's still a 105 00:06:14,400 --> 00:06:16,840 Speaker 2: thing that's really happening. Because you know, there's so much 106 00:06:16,839 --> 00:06:22,560 Speaker 2: talk these things about technology and drones and automated cards 107 00:06:22,600 --> 00:06:25,440 Speaker 2: and things like that that I think people just forget 108 00:06:26,040 --> 00:06:30,279 Speaker 2: that almost everything that you probably have in your studio, 109 00:06:30,440 --> 00:06:33,359 Speaker 2: I have here in my office. At some point in time. 110 00:06:34,120 --> 00:06:37,920 Speaker 2: It's life cycle. It was in a railcar, because that's 111 00:06:38,000 --> 00:06:42,200 Speaker 2: just how things move around the organization. The other thing 112 00:06:42,440 --> 00:06:47,200 Speaker 2: that I think is a misconception about Greenbrier is that 113 00:06:47,279 --> 00:06:50,760 Speaker 2: we are just that manufacturing company. Right. That is our foundation, 114 00:06:51,040 --> 00:06:54,520 Speaker 2: and it's one of the things that we've talked a 115 00:06:54,560 --> 00:06:58,000 Speaker 2: lot about over the years, and it is part of 116 00:06:58,000 --> 00:07:01,440 Speaker 2: our DNA, it's part of our foundation. But we're more 117 00:07:01,520 --> 00:07:05,320 Speaker 2: than just a manufacturing company these days. So f Y 118 00:07:05,400 --> 00:07:09,600 Speaker 2: twenty five for us, which ended in August, we actually 119 00:07:09,640 --> 00:07:14,880 Speaker 2: had record financial results on two thousand fewer new car 120 00:07:14,960 --> 00:07:20,360 Speaker 2: deliverance than before. So that's the part that I think 121 00:07:20,360 --> 00:07:23,360 Speaker 2: my team sometimes gets frustrated because I repeat it over 122 00:07:23,520 --> 00:07:26,600 Speaker 2: and over again. We're not just a new car builder. 123 00:07:27,120 --> 00:07:30,120 Speaker 2: Some of that is because we've expanded by lease in business, 124 00:07:30,520 --> 00:07:33,880 Speaker 2: some of it is because we're providing maintenance and management 125 00:07:33,920 --> 00:07:36,880 Speaker 2: services to other folks, and a big piece of it 126 00:07:36,960 --> 00:07:41,040 Speaker 2: is just because we're focused on how can we get 127 00:07:41,120 --> 00:07:44,960 Speaker 2: more value out of where we've made investments in our 128 00:07:45,000 --> 00:07:50,400 Speaker 2: court point So the last years has actually been lower 129 00:07:50,440 --> 00:07:54,960 Speaker 2: demand for new rail cars in North America. And instead 130 00:07:55,000 --> 00:07:57,600 Speaker 2: of just you know, clasping our hands and saying, well, 131 00:07:57,600 --> 00:08:02,080 Speaker 2: we'll wait until demand comes back, we looked at our facilities. 132 00:08:02,800 --> 00:08:05,600 Speaker 2: We've got great field sales folks and they work with 133 00:08:05,640 --> 00:08:08,600 Speaker 2: our customers on what some of their needs are. And 134 00:08:08,640 --> 00:08:13,000 Speaker 2: that's where we were able to utilize what was traditionally 135 00:08:13,040 --> 00:08:17,040 Speaker 2: a new car facility to do large program work. And 136 00:08:17,640 --> 00:08:21,200 Speaker 2: large program work is for tank cars, for example, they 137 00:08:21,240 --> 00:08:26,239 Speaker 2: have to be recertified every ten years. So we're able 138 00:08:26,280 --> 00:08:30,760 Speaker 2: to work with a customer that has a large fleet 139 00:08:31,080 --> 00:08:34,280 Speaker 2: that needs all these tank cards being prequalified and we 140 00:08:34,320 --> 00:08:36,600 Speaker 2: can run them through that new car facility in a 141 00:08:36,760 --> 00:08:42,040 Speaker 2: very efficient way. Or have customers that say, have maybe 142 00:08:42,040 --> 00:08:43,920 Speaker 2: a bunch of cars that need to be reliveed. And 143 00:08:44,000 --> 00:08:46,600 Speaker 2: so just looking at where we've made investments in our 144 00:08:46,640 --> 00:08:49,800 Speaker 2: facilities and our footprint and utilizing those in a different 145 00:08:49,840 --> 00:08:55,079 Speaker 2: way allowed us to generate those record financial results on 146 00:08:55,160 --> 00:08:56,880 Speaker 2: more than just new car deliveries. 147 00:08:57,240 --> 00:08:58,680 Speaker 1: And if I heard you right, you mentioned that you 148 00:08:58,720 --> 00:09:03,680 Speaker 1: sold you know you're financially performed better by selling less railcars. 149 00:09:04,800 --> 00:09:07,880 Speaker 1: What drove the decline in railcar demand. 150 00:09:08,360 --> 00:09:10,920 Speaker 2: Well, I would say that one of the things that's 151 00:09:11,000 --> 00:09:17,120 Speaker 2: interesting over calendar twenty twenty five is we have seen 152 00:09:17,160 --> 00:09:22,559 Speaker 2: a pullback in shippers, the people who are using railcars 153 00:09:22,559 --> 00:09:28,400 Speaker 2: in North America. There's such an uncertain economy and an 154 00:09:28,440 --> 00:09:31,320 Speaker 2: operating environment in North America with some of the changes 155 00:09:31,360 --> 00:09:34,920 Speaker 2: that are going on through the current administration, that people 156 00:09:35,360 --> 00:09:37,280 Speaker 2: what we were seeing with our customers, they just kind 157 00:09:37,320 --> 00:09:39,839 Speaker 2: of pulled back and said, I don't I'm going to 158 00:09:39,880 --> 00:09:44,440 Speaker 2: wait on investing in new transportation equipment until I figure 159 00:09:44,480 --> 00:09:48,040 Speaker 2: out where am I going to invest in my business 160 00:09:48,040 --> 00:09:51,439 Speaker 2: whatever that business is. Right, whether you grain company or 161 00:09:51,800 --> 00:09:55,840 Speaker 2: an energy company or a food products company, You've got 162 00:09:55,840 --> 00:09:57,520 Speaker 2: to think about where am I going to invest in 163 00:09:57,559 --> 00:10:00,600 Speaker 2: my next facility, and then I can think about what 164 00:10:00,679 --> 00:10:04,000 Speaker 2: do I need for my supply chain, whether it's inbound 165 00:10:04,520 --> 00:10:09,040 Speaker 2: raw materials, do I need railcard or it's outbound of 166 00:10:09,040 --> 00:10:12,360 Speaker 2: my completed product. So that is the biggest piece of 167 00:10:12,400 --> 00:10:17,800 Speaker 2: where we saw people pause on delivering new cars now 168 00:10:18,200 --> 00:10:21,319 Speaker 2: or ordering new cars. One of the things that benefits 169 00:10:21,440 --> 00:10:23,560 Speaker 2: us because we took a lot of great orders in 170 00:10:23,640 --> 00:10:26,640 Speaker 2: calendar twenty four, which is what we built in our 171 00:10:26,679 --> 00:10:29,720 Speaker 2: calendar twenty five that allowed us to have those records 172 00:10:30,120 --> 00:10:31,120 Speaker 2: financial results. 173 00:10:31,400 --> 00:10:33,880 Speaker 1: And rail cars aren't cheap, and I know they price 174 00:10:33,960 --> 00:10:36,600 Speaker 1: difference from the type of car, and then within the 175 00:10:36,640 --> 00:10:39,760 Speaker 1: type of car that differs. Roughly like if I wanted 176 00:10:39,760 --> 00:10:41,400 Speaker 1: to buy a tank car, becau, I'm assuming those are 177 00:10:41,440 --> 00:10:47,400 Speaker 1: the more expensive ones. Are they over one hundred thousand dollars? 178 00:10:47,440 --> 00:10:50,760 Speaker 1: Like retail that you're not giving me a discout. I'm 179 00:10:50,800 --> 00:10:52,640 Speaker 1: full paying, full free for. 180 00:10:52,640 --> 00:10:55,760 Speaker 2: You, Lee, I'd give you a ten percent discount. 181 00:10:56,400 --> 00:10:57,160 Speaker 1: I appreciate that. 182 00:10:57,480 --> 00:11:00,960 Speaker 2: But for all of those other customers that are listening, 183 00:11:00,960 --> 00:11:04,600 Speaker 2: I would say, on average the sales price is around 184 00:11:04,679 --> 00:11:07,400 Speaker 2: one hundred and fifty to one hundred and sixty thousand dollars, 185 00:11:07,640 --> 00:11:10,160 Speaker 2: but a lot of that is dependent on the cost 186 00:11:10,280 --> 00:11:14,560 Speaker 2: of steel, So depending on where that sits, that might 187 00:11:14,679 --> 00:11:17,720 Speaker 2: impact that top line price of a railcar, as well 188 00:11:17,760 --> 00:11:21,000 Speaker 2: as the engineering and design goes into an impact on 189 00:11:21,280 --> 00:11:24,280 Speaker 2: the pricing car. So all tank cars are not made 190 00:11:24,280 --> 00:11:27,360 Speaker 2: the same, meaning right, different prices. 191 00:11:27,040 --> 00:11:30,439 Speaker 1: Right, So on that the cost of steel, obviously tariffs 192 00:11:30,480 --> 00:11:33,640 Speaker 1: have had the impact on you know where that is gone. 193 00:11:33,840 --> 00:11:37,560 Speaker 1: Can you talk about the impact of tariffs on your 194 00:11:37,679 --> 00:11:40,640 Speaker 1: overall cost to produce a railcar. 195 00:11:41,200 --> 00:11:44,960 Speaker 2: Sure, So, as I said, steel is the major component 196 00:11:45,200 --> 00:11:47,760 Speaker 2: of a railcar, whether it's a freight car or a 197 00:11:47,800 --> 00:11:51,800 Speaker 2: tank car. We do build for the North American market. 198 00:11:51,840 --> 00:11:55,920 Speaker 2: We build both in Arkansas as well as down in Mexico, 199 00:11:56,320 --> 00:12:00,240 Speaker 2: but we're sourcing the vast majority of our material is 200 00:12:00,240 --> 00:12:03,679 Speaker 2: coming from US steel manufacturer. So even for the cars 201 00:12:03,679 --> 00:12:07,040 Speaker 2: that we're building in Mexico, we're sourcing that steal from 202 00:12:07,600 --> 00:12:12,920 Speaker 2: the United States. So that's where our procurement team is amazing. 203 00:12:12,920 --> 00:12:15,920 Speaker 2: They've done a great job of securing great prices on 204 00:12:15,960 --> 00:12:19,680 Speaker 2: that and then you know, fortunately or unfortunately, we've been 205 00:12:19,760 --> 00:12:23,640 Speaker 2: through a number of cycles in the North American market 206 00:12:23,720 --> 00:12:27,640 Speaker 2: when it comes to input calls for building a rail car. 207 00:12:27,840 --> 00:12:30,120 Speaker 2: So we work with our customers to set up a 208 00:12:30,120 --> 00:12:33,840 Speaker 2: way that it's you know, we're not looking to make 209 00:12:33,960 --> 00:12:37,120 Speaker 2: money on how steel price moved. We make money on 210 00:12:37,160 --> 00:12:40,199 Speaker 2: the design and production of our railcars. So that's where 211 00:12:40,200 --> 00:12:44,200 Speaker 2: we work collaboratively with our customers to make certain that 212 00:12:44,280 --> 00:12:46,079 Speaker 2: we boot that balance. 213 00:12:46,880 --> 00:12:50,200 Speaker 1: You know, you mentioned the kind of the state of 214 00:12:50,360 --> 00:12:54,800 Speaker 1: the market last year and how that impacted you this year. 215 00:12:55,040 --> 00:12:57,520 Speaker 1: Can you talk about maybe the outlook looking a little 216 00:12:57,559 --> 00:13:01,040 Speaker 1: further out, or maybe out a year. You know, I'm 217 00:13:01,040 --> 00:13:03,400 Speaker 1: assuming you guys have an order book that you might 218 00:13:03,440 --> 00:13:06,360 Speaker 1: be able to talk to and talk about how that 219 00:13:06,520 --> 00:13:09,840 Speaker 1: order book looks relative to past cycles. 220 00:13:10,120 --> 00:13:14,640 Speaker 2: Sure, I'm always excited to talk about our backlog. As 221 00:13:14,679 --> 00:13:19,480 Speaker 2: I mentioned, our fiscal twenty twenty five was record breaking, 222 00:13:19,600 --> 00:13:21,959 Speaker 2: so if I were to look back a year ago, 223 00:13:22,880 --> 00:13:27,040 Speaker 2: our backlog was a bit higher. But the backlog at 224 00:13:27,040 --> 00:13:30,120 Speaker 2: the end of our first quarter is twenty three four 225 00:13:30,200 --> 00:13:34,000 Speaker 2: hundred units with the value of three billion dollars. So 226 00:13:34,360 --> 00:13:37,920 Speaker 2: that does give us a lot of opportunity to plan 227 00:13:38,120 --> 00:13:40,960 Speaker 2: and to think about where we're going to build parts 228 00:13:41,000 --> 00:13:45,800 Speaker 2: and how that impacts our different facilities. But the last 229 00:13:45,800 --> 00:13:49,920 Speaker 2: twelve months have been lower order activity, which is why 230 00:13:49,960 --> 00:13:52,680 Speaker 2: we're utilizing some of our facilities to do some of 231 00:13:52,720 --> 00:13:58,040 Speaker 2: this program work. That being said, we're starting to see 232 00:13:58,080 --> 00:14:02,480 Speaker 2: some real green shoots. So December, which is typically a 233 00:14:02,520 --> 00:14:05,719 Speaker 2: fairly quiet month when it comes to orders, people are, 234 00:14:06,040 --> 00:14:08,920 Speaker 2: you know, taking time off for the holidays, we saw 235 00:14:09,360 --> 00:14:13,880 Speaker 2: what I would consider very positive activity. So we're excited 236 00:14:13,920 --> 00:14:17,520 Speaker 2: for the second half of calendar twenty twenty six, and 237 00:14:17,600 --> 00:14:19,760 Speaker 2: we're ramping up to get ready for that. 238 00:14:20,800 --> 00:14:23,160 Speaker 1: And so you know you mentioned this large order book 239 00:14:23,160 --> 00:14:26,239 Speaker 1: that you have in backlog. So if I'm a customer 240 00:14:26,280 --> 00:14:29,360 Speaker 1: and I put in an order today once, should I 241 00:14:29,440 --> 00:14:32,200 Speaker 1: expect delivery? Assuming that I mean it's like a car 242 00:14:32,280 --> 00:14:34,920 Speaker 1: dealership where you have like a lot of railcars waiting 243 00:14:35,040 --> 00:14:37,640 Speaker 1: to sell, or pretty much, you make the order and 244 00:14:37,680 --> 00:14:40,360 Speaker 1: then you guys make the product and then it gets delivered. 245 00:14:40,480 --> 00:14:45,440 Speaker 2: It's a great question. Typically it would be several months 246 00:14:45,480 --> 00:14:48,200 Speaker 2: between when you place an order and when you might 247 00:14:48,320 --> 00:14:53,280 Speaker 2: get your railcar. Our customers know that these are long 248 00:14:53,400 --> 00:14:57,080 Speaker 2: lead item products, so that's where you know, our our 249 00:14:57,080 --> 00:15:00,920 Speaker 2: field sales folks are working closely with our customers to 250 00:15:01,040 --> 00:15:03,760 Speaker 2: understand what their needs are and what their timing goes. 251 00:15:04,120 --> 00:15:08,120 Speaker 2: So we're thinking that through with our production facilities and 252 00:15:08,200 --> 00:15:12,920 Speaker 2: where we are running on current lines. So you know, 253 00:15:13,040 --> 00:15:15,200 Speaker 2: again it's a several month process. 254 00:15:15,560 --> 00:15:17,800 Speaker 1: Okay. So you know we've seen a little bit of 255 00:15:17,840 --> 00:15:21,280 Speaker 1: consolidation in the rail industry and the CPKC deal a 256 00:15:21,280 --> 00:15:23,640 Speaker 1: couple of years ago, and then there's a spending up 257 00:15:23,880 --> 00:15:27,320 Speaker 1: and S deal that the STB is taking a hard 258 00:15:27,360 --> 00:15:32,680 Speaker 1: look at. This consolidation of of the market impact Greenbrier 259 00:15:32,800 --> 00:15:35,680 Speaker 1: one way or another. Like you know when when CP 260 00:15:35,840 --> 00:15:38,440 Speaker 1: and case He got together, was where they all of 261 00:15:38,440 --> 00:15:41,160 Speaker 1: a sudden, well, we don't need as many railcars because 262 00:15:41,600 --> 00:15:44,640 Speaker 1: our fleet got bigger and we can better utilize the 263 00:15:44,640 --> 00:15:45,280 Speaker 1: ones that we have. 264 00:15:45,840 --> 00:15:49,360 Speaker 2: So it's it's a great question and obviously very relevant 265 00:15:49,360 --> 00:15:54,120 Speaker 2: in today's market. You know, over the last twenty five 266 00:15:54,200 --> 00:15:56,760 Speaker 2: years have been a number of mergers that have happened 267 00:15:56,800 --> 00:16:01,560 Speaker 2: in the North American Class one rail road space, and 268 00:16:01,600 --> 00:16:06,840 Speaker 2: I'd say we have learned to navigate those. Sometimes bizarrely, 269 00:16:07,440 --> 00:16:11,480 Speaker 2: when two railroads get together, if they don't get that 270 00:16:11,600 --> 00:16:17,280 Speaker 2: combination operationally as smooth I'm sure as they would like it, 271 00:16:16,160 --> 00:16:20,560 Speaker 2: it results in the pervers need for more rail cars. 272 00:16:21,040 --> 00:16:25,080 Speaker 2: So the prior merger where we saw huge demand for 273 00:16:25,240 --> 00:16:31,360 Speaker 2: new rail cars because velocity slowed and people weren't they 274 00:16:31,440 --> 00:16:34,800 Speaker 2: just leaning more cars to near the product. I tend 275 00:16:34,800 --> 00:16:38,560 Speaker 2: to think about we need the pending or potential merger 276 00:16:39,120 --> 00:16:41,840 Speaker 2: as something that we'll just have to navigate. I think 277 00:16:41,920 --> 00:16:45,200 Speaker 2: I like to think more about our industry ballistically for 278 00:16:45,280 --> 00:16:48,520 Speaker 2: the North American market right is how can we make 279 00:16:49,560 --> 00:16:54,160 Speaker 2: transport of products via rail more efficient so that we're 280 00:16:54,240 --> 00:16:58,040 Speaker 2: gaining modal share. So that's good for the Class one railroads, 281 00:16:58,280 --> 00:17:01,800 Speaker 2: that's good for the manufacturers, that's good for the leasing companies. 282 00:17:03,000 --> 00:17:05,320 Speaker 2: I really want us to focus on how do we 283 00:17:05,440 --> 00:17:09,919 Speaker 2: make the freight rail pie bigger? And even if we 284 00:17:10,000 --> 00:17:12,760 Speaker 2: all just maintain same market share, our slice of pie 285 00:17:12,760 --> 00:17:15,720 Speaker 2: would be bigger. Right, So that's my focus. 286 00:17:16,640 --> 00:17:19,719 Speaker 1: And so in your customers, at least here in the 287 00:17:19,840 --> 00:17:23,080 Speaker 1: United States and Canada, are most of the customers like 288 00:17:23,280 --> 00:17:26,480 Speaker 1: shippers reil and not the class one rails. Did you 289 00:17:26,520 --> 00:17:27,440 Speaker 1: break that out at all? 290 00:17:28,720 --> 00:17:31,199 Speaker 2: We've seen a shift. We do break that out in 291 00:17:31,280 --> 00:17:35,800 Speaker 2: some of our investor decks. Railroads themselves are not necessarily 292 00:17:35,840 --> 00:17:39,080 Speaker 2: the largest buyers of new rail park, right, so they 293 00:17:39,080 --> 00:17:43,280 Speaker 2: have certain fleets that they tend to maintain for themselves, 294 00:17:43,359 --> 00:17:47,200 Speaker 2: but a lot of times it's operating lesslres or shippers 295 00:17:47,200 --> 00:17:48,440 Speaker 2: themselves who own the park. 296 00:17:48,880 --> 00:17:51,240 Speaker 1: Got ya. So, you know, we did talk about tariffs, 297 00:17:51,240 --> 00:17:55,480 Speaker 1: and we can't talk about tariffs talking about inflation Outside 298 00:17:55,600 --> 00:17:58,360 Speaker 1: of the impact from tariff, is there any other inflationary 299 00:17:58,359 --> 00:18:01,679 Speaker 1: pressures that you guys are dealing with? And you know, 300 00:18:03,440 --> 00:18:05,560 Speaker 1: I guess you kind of alluded that. You know, your 301 00:18:05,640 --> 00:18:08,159 Speaker 1: prices for the railcar can kind of float relative to 302 00:18:08,240 --> 00:18:12,040 Speaker 1: the costs of steel. So how do you deal with 303 00:18:12,080 --> 00:18:16,639 Speaker 1: other inflationary pressures, whether it's labor or other things that. 304 00:18:17,000 --> 00:18:20,000 Speaker 2: You deal with, Sure, and you hit on exactly what 305 00:18:20,040 --> 00:18:21,800 Speaker 2: I was going to talk about. So we talked about 306 00:18:21,840 --> 00:18:25,080 Speaker 2: steel and the inflationary impacts of what's going on with 307 00:18:25,160 --> 00:18:28,640 Speaker 2: steel liquor in the area where we stay very focused 308 00:18:28,680 --> 00:18:33,160 Speaker 2: because I want to make certain that we're taking care 309 00:18:33,320 --> 00:18:35,320 Speaker 2: of the men and women who are working on our 310 00:18:35,320 --> 00:18:38,120 Speaker 2: short floor, not only from keeping them safe as they 311 00:18:38,160 --> 00:18:41,080 Speaker 2: do the work, but also paying them a nice wage 312 00:18:41,119 --> 00:18:44,879 Speaker 2: because they're the front line and the shoulders that we 313 00:18:45,040 --> 00:18:49,960 Speaker 2: lean on to deliver our products. That's one area where 314 00:18:49,960 --> 00:18:53,800 Speaker 2: we've seen some inflation. I believe that we've got good 315 00:18:53,840 --> 00:18:56,440 Speaker 2: relations with our workforce where we're able to do that, 316 00:18:56,520 --> 00:19:02,000 Speaker 2: particularly when we have to navigate lower demand and we've 317 00:19:02,040 --> 00:19:04,920 Speaker 2: had to lay off thousands of people that you know, 318 00:19:05,119 --> 00:19:08,679 Speaker 2: we find ways to get them back. So those are 319 00:19:08,680 --> 00:19:11,840 Speaker 2: the two areas where I think really about inflation would 320 00:19:11,840 --> 00:19:13,960 Speaker 2: be steel and our workforce. 321 00:19:14,680 --> 00:19:17,480 Speaker 1: So when you look at from a strategic focus, you 322 00:19:17,480 --> 00:19:20,760 Speaker 1: know what parts of Green buyer business, whether it's manufacturing, leasing, 323 00:19:20,760 --> 00:19:23,159 Speaker 1: our services, is going to drive the most growth for 324 00:19:23,200 --> 00:19:26,200 Speaker 1: the company over the next twelve months and longer term 325 00:19:26,240 --> 00:19:28,360 Speaker 1: doesn't have to be just twelve months, right. 326 00:19:29,040 --> 00:19:30,920 Speaker 2: It's a good point. It's something that we talk about 327 00:19:31,000 --> 00:19:33,800 Speaker 2: on a regular basis, whether it's both my leadership team 328 00:19:33,960 --> 00:19:36,800 Speaker 2: or in the Greenbrier board room. It really comes down 329 00:19:36,840 --> 00:19:42,160 Speaker 2: to balance again because we've navigated a variety of cycles 330 00:19:42,200 --> 00:19:47,000 Speaker 2: over time. As I mentioned earlier, new car demand can 331 00:19:47,080 --> 00:19:52,159 Speaker 2: be cyclical, and we have navigated those cycles in the past. 332 00:19:52,920 --> 00:19:56,280 Speaker 2: This is why we're growing our least sleep to generate 333 00:19:56,400 --> 00:20:01,000 Speaker 2: that more a higher level of repeatable and state revenue 334 00:20:01,200 --> 00:20:06,040 Speaker 2: and operating margin, but also looking at how can we 335 00:20:07,119 --> 00:20:11,240 Speaker 2: continue to provide return to our shareholders. So it's a 336 00:20:11,280 --> 00:20:14,400 Speaker 2: balance between each one of those areas where we think 337 00:20:14,560 --> 00:20:17,959 Speaker 2: through where is the demand going to come from, and 338 00:20:18,040 --> 00:20:23,880 Speaker 2: how can we meet our customers with creative solutions so 339 00:20:23,920 --> 00:20:25,800 Speaker 2: that it's kind of a win win, whether it's on 340 00:20:25,840 --> 00:20:29,280 Speaker 2: a new car as I was mentioning before, with some 341 00:20:29,359 --> 00:20:32,080 Speaker 2: of this large program work, if there's a way that 342 00:20:32,119 --> 00:20:37,560 Speaker 2: we can providing those creative solutions to generate more activity 343 00:20:37,640 --> 00:20:42,240 Speaker 2: for green Brier, and then take and do that activity 344 00:20:42,320 --> 00:20:46,639 Speaker 2: in a very cost effective and efficient way so that 345 00:20:46,680 --> 00:20:48,480 Speaker 2: we're creating value for our shareholders. 346 00:20:48,800 --> 00:20:51,560 Speaker 1: And so you know you mentioned earlier that you know 347 00:20:51,600 --> 00:20:55,760 Speaker 1: you get paid for design as part of the kind 348 00:20:55,800 --> 00:21:00,480 Speaker 1: of value proposition that Greenbriar offers. Can you talk about, 349 00:21:00,600 --> 00:21:04,199 Speaker 1: you know, how designs have changed and what kind of 350 00:21:04,240 --> 00:21:07,960 Speaker 1: benefits the shippers are getting from those improved designs. 351 00:21:08,440 --> 00:21:11,119 Speaker 2: Yes, and this is a great opportunity for me to 352 00:21:11,160 --> 00:21:14,480 Speaker 2: give a plug again to our field sales folks, who 353 00:21:14,480 --> 00:21:17,199 Speaker 2: are you know, Val rode to the hip with our 354 00:21:17,240 --> 00:21:22,720 Speaker 2: customers and understanding what their needs and issues are as 355 00:21:22,720 --> 00:21:25,920 Speaker 2: they're using a freight car, as well as our engineering team. 356 00:21:26,680 --> 00:21:29,159 Speaker 2: Matter of fact, we just had a presentation from a 357 00:21:29,160 --> 00:21:32,520 Speaker 2: couple of our great young engineers yesterday talking about how 358 00:21:33,800 --> 00:21:38,160 Speaker 2: we are regularly coming up with ways to support the industry, 359 00:21:38,240 --> 00:21:43,159 Speaker 2: whether it's you know, redesigning or improving something like a 360 00:21:43,240 --> 00:21:47,400 Speaker 2: gondola so that it can carry more of whatever it's pairing, right, 361 00:21:47,480 --> 00:21:52,400 Speaker 2: maybe it's steels, trapped steel, How can we make that larger, lighter, 362 00:21:52,600 --> 00:21:56,879 Speaker 2: but still something that can be operated in such heavy 363 00:21:58,000 --> 00:22:02,439 Speaker 2: operations without breaking down. We also invest in ways that 364 00:22:02,480 --> 00:22:05,680 Speaker 2: we can transport seal for some of our steel customers 365 00:22:05,680 --> 00:22:09,000 Speaker 2: who have maybe big plates of steel that they're thinking 366 00:22:09,040 --> 00:22:12,800 Speaker 2: about how do they navigate through a tunnel or under 367 00:22:12,800 --> 00:22:16,600 Speaker 2: a bridge, and using our engineering to think through how 368 00:22:16,640 --> 00:22:19,639 Speaker 2: do we, you know, maybe make a car that has 369 00:22:20,440 --> 00:22:23,680 Speaker 2: a folding device that tilts so that it can make 370 00:22:23,720 --> 00:22:28,400 Speaker 2: those clearances. We also think about how can we use 371 00:22:29,119 --> 00:22:32,760 Speaker 2: lighter products so that what's called the tear weight of 372 00:22:32,800 --> 00:22:35,920 Speaker 2: a railcar, right, so that's the empty weight of a railcar. 373 00:22:37,040 --> 00:22:41,199 Speaker 2: The less it is, the lighter a railcar is, the 374 00:22:41,280 --> 00:22:43,880 Speaker 2: more product it can carry on the inside. So those 375 00:22:43,880 --> 00:22:47,320 Speaker 2: are the things that we're regularly doing to come up 376 00:22:47,359 --> 00:22:48,920 Speaker 2: with different or new products. 377 00:22:49,320 --> 00:22:52,879 Speaker 1: And so in addition to you know, engineering the railcar, 378 00:22:53,240 --> 00:22:57,520 Speaker 1: obviously you probably re engineer your manufacturing processes and try 379 00:22:57,560 --> 00:23:01,840 Speaker 1: to be more productive across the organization. Can you talk 380 00:23:01,840 --> 00:23:04,120 Speaker 1: about things that you guys have been doing to kind 381 00:23:04,119 --> 00:23:10,359 Speaker 1: of drive better margins, whether that's technology, fuel, productivity tools 382 00:23:10,480 --> 00:23:11,679 Speaker 1: or whatever you want to share. 383 00:23:12,000 --> 00:23:15,040 Speaker 2: Sure, And actually this was part of our presentation at 384 00:23:15,080 --> 00:23:19,200 Speaker 2: our investor day back in twenty twenty three. Is we 385 00:23:19,359 --> 00:23:23,320 Speaker 2: made a significant commitment and have completed the investment into 386 00:23:23,440 --> 00:23:28,560 Speaker 2: some insourcing activity at our facility in Central Mexico. And 387 00:23:28,600 --> 00:23:33,320 Speaker 2: that's the reason not hit the radar is as we 388 00:23:33,359 --> 00:23:37,120 Speaker 2: came out of COVID and demand was starting to pick up. 389 00:23:37,720 --> 00:23:40,600 Speaker 2: We realized that we had to go further and further 390 00:23:41,200 --> 00:23:45,560 Speaker 2: away from our manufacturing base to source some of the 391 00:23:45,560 --> 00:23:48,960 Speaker 2: components that we needed to build the rail farers. And 392 00:23:49,000 --> 00:23:50,879 Speaker 2: what we'll step back and proud about that. It's like, 393 00:23:50,920 --> 00:23:54,520 Speaker 2: oh my goodness, we are buying steel, having it sent 394 00:23:54,640 --> 00:23:59,080 Speaker 2: somewhere very far away from our plant, having it used 395 00:23:59,119 --> 00:24:02,639 Speaker 2: to create a component and then ship to us. Turns 396 00:24:02,680 --> 00:24:05,199 Speaker 2: out building a railcar is then being metaled. So we 397 00:24:05,320 --> 00:24:08,080 Speaker 2: know how to do that. What are the components that 398 00:24:08,119 --> 00:24:13,399 Speaker 2: we could bring closer to our manufacturing facility reduce the 399 00:24:13,440 --> 00:24:17,000 Speaker 2: amount of time that that components are moving back and forth. 400 00:24:17,040 --> 00:24:19,719 Speaker 2: It also gives us the opportunity to think about that 401 00:24:19,840 --> 00:24:23,719 Speaker 2: plate steel that a component is made out of and 402 00:24:24,280 --> 00:24:27,359 Speaker 2: use it more efficiently so there's less waste. Whatever ways 403 00:24:27,440 --> 00:24:30,320 Speaker 2: there is, we can control where that goes for recycling. 404 00:24:30,480 --> 00:24:32,960 Speaker 2: So that's one of the bigger things that we've It 405 00:24:33,000 --> 00:24:37,399 Speaker 2: took us several years to do that insourcing activity. The 406 00:24:37,480 --> 00:24:40,879 Speaker 2: other thing that we're doing is over the last several years, 407 00:24:40,880 --> 00:24:43,640 Speaker 2: we've really been looking at our footfront in North America 408 00:24:43,680 --> 00:24:48,479 Speaker 2: and saying, are we using our footprint the best way possible. Right, 409 00:24:48,520 --> 00:24:52,840 Speaker 2: where are there opportunities for continuous improvement to create operating 410 00:24:52,880 --> 00:24:56,560 Speaker 2: efficiencies that show up in our income statement with that 411 00:24:56,680 --> 00:24:59,159 Speaker 2: aggregate growth margin that I was talking about. Right, So 412 00:24:59,720 --> 00:25:04,439 Speaker 2: we're obviously successful in doing that because we achieved really 413 00:25:04,560 --> 00:25:08,520 Speaker 2: amazing aggregate ghost margins from eighteen percent range for Actice 414 00:25:08,520 --> 00:25:11,640 Speaker 2: Colle twenty twenty five. Now we're taking some of those 415 00:25:11,720 --> 00:25:15,920 Speaker 2: learnings and using those in Europe to leveraging those learnings 416 00:25:15,960 --> 00:25:19,880 Speaker 2: in Europe as we evaluate our footprint there and consolidate 417 00:25:19,920 --> 00:25:26,760 Speaker 2: our production into fewer facilities so that we're optimizing the 418 00:25:26,840 --> 00:25:29,600 Speaker 2: overhead boots and plates that we'll try facility. 419 00:25:29,800 --> 00:25:33,720 Speaker 1: And so, you know, everyone likes to talk about AI 420 00:25:33,800 --> 00:25:38,119 Speaker 1: and machine learning. Are you leveraging those tools across your organization? 421 00:25:38,240 --> 00:25:41,000 Speaker 1: And if you get some examples on kind of the 422 00:25:41,040 --> 00:25:42,520 Speaker 1: benefits that you're seeing. 423 00:25:43,040 --> 00:25:45,840 Speaker 2: Sure, And sometimes I feel like I must be like 424 00:25:45,840 --> 00:25:48,119 Speaker 2: one hundred years old, because there's a lot of stuff 425 00:25:48,400 --> 00:25:51,760 Speaker 2: in AI that I don't fully appreciate. You're actually just 426 00:25:51,840 --> 00:25:54,920 Speaker 2: having a meeting yesterday. It seems like there's a lot 427 00:25:54,960 --> 00:26:00,720 Speaker 2: of opportunities for us for me to embrace AI differently 428 00:26:00,760 --> 00:26:03,760 Speaker 2: than I have. But broadly through the organization. What we're 429 00:26:03,760 --> 00:26:08,399 Speaker 2: seeing is more in the management services or some of 430 00:26:08,440 --> 00:26:14,040 Speaker 2: our administrative departments leaning into using that AI to make 431 00:26:14,320 --> 00:26:19,399 Speaker 2: their work a lot more efficient. And our operating facilities, 432 00:26:20,280 --> 00:26:24,040 Speaker 2: we're using AI through our closed paths from TVs right, 433 00:26:24,080 --> 00:26:27,240 Speaker 2: so TV cameras do we have these cameras throughout our 434 00:26:27,280 --> 00:26:34,280 Speaker 2: facilities to help us to identify maybe unsafe behaviors or procedures. 435 00:26:34,920 --> 00:26:38,479 Speaker 2: And because we're using AI to identify that, that allows 436 00:26:38,560 --> 00:26:42,800 Speaker 2: us to more quickly have eyes on the entire facility 437 00:26:42,880 --> 00:26:45,199 Speaker 2: and then bring that back to the workforce so that 438 00:26:45,240 --> 00:26:48,120 Speaker 2: we can change some of our procedures. So that's another way. 439 00:26:48,560 --> 00:26:54,280 Speaker 2: And when you think about the transport of goods, you know, 440 00:26:54,560 --> 00:26:56,800 Speaker 2: I think we've all gotten very comfortable with you can 441 00:26:56,880 --> 00:27:00,879 Speaker 2: go on to Amazon and order something quickly, look and 442 00:27:00,920 --> 00:27:03,560 Speaker 2: see where's my package and when's it going to end 443 00:27:03,640 --> 00:27:06,520 Speaker 2: up on my doors? Yeah, it's not really the case 444 00:27:06,680 --> 00:27:09,600 Speaker 2: in moving products via rate, But we've been on a 445 00:27:09,680 --> 00:27:13,760 Speaker 2: journey with the broader industry around from all rail polls 446 00:27:14,240 --> 00:27:18,399 Speaker 2: where telematics are installed onto rail cars, which is helping 447 00:27:18,480 --> 00:27:22,400 Speaker 2: to identify where a car is at any particular time. 448 00:27:22,520 --> 00:27:28,240 Speaker 2: It's also used to identify where there's maintenance means or 449 00:27:28,240 --> 00:27:31,200 Speaker 2: some sort of service in the ground cards it helped 450 00:27:31,280 --> 00:27:31,800 Speaker 2: us seek. 451 00:27:32,080 --> 00:27:34,280 Speaker 1: So if you know, if you put on your old 452 00:27:34,320 --> 00:27:37,480 Speaker 1: CFO hat on, you know, how do you balance investments 453 00:27:37,480 --> 00:27:42,840 Speaker 1: in growth, modernization and shareholder returns in today's operating environment. 454 00:27:43,320 --> 00:27:47,120 Speaker 2: Do a lot of analysis, You have a lot of conversations. 455 00:27:47,520 --> 00:27:51,639 Speaker 2: You think about what is that right balance this is, 456 00:27:51,880 --> 00:27:54,720 Speaker 2: you know, going back to what I was saying about footprints, 457 00:27:54,920 --> 00:27:59,160 Speaker 2: where we worked at some of our different locations, and 458 00:27:59,520 --> 00:28:02,440 Speaker 2: are there ways that we've can strained value create more 459 00:28:02,640 --> 00:28:06,600 Speaker 2: return to the capital that we've invested in a particular facility. 460 00:28:07,440 --> 00:28:09,320 Speaker 2: What makes the most sense. Do we need to spend 461 00:28:09,320 --> 00:28:12,120 Speaker 2: a little bit more so that we tendine have better 462 00:28:12,200 --> 00:28:16,040 Speaker 2: gross marketings so that we can operate more efficiently. That's 463 00:28:16,040 --> 00:28:19,760 Speaker 2: what we did with our insourcing. But we've also been 464 00:28:19,880 --> 00:28:24,120 Speaker 2: on a record of steady quarterly dividends to our shareholders. 465 00:28:24,400 --> 00:28:27,240 Speaker 2: So that's what we're trying to balance between those means 466 00:28:27,280 --> 00:28:32,119 Speaker 2: of investing in our facilities, growing our lease fleet, and 467 00:28:32,480 --> 00:28:33,920 Speaker 2: sharing that with our shareholders. 468 00:28:34,320 --> 00:28:35,480 Speaker 1: Do you guys do a buy back? 469 00:28:35,920 --> 00:28:39,600 Speaker 2: We are periodically yes in the market buying backshare So. 470 00:28:40,720 --> 00:28:42,880 Speaker 1: We mentioned you've been with the company for a while. 471 00:28:43,520 --> 00:28:47,280 Speaker 1: How did you get into transportation, the transportation industry. 472 00:28:47,040 --> 00:28:48,000 Speaker 2: I took a wrong turn. 473 00:28:51,440 --> 00:28:53,480 Speaker 1: Well, most people are either born into or they or 474 00:28:53,600 --> 00:28:54,920 Speaker 1: they step into it if you will. 475 00:28:55,360 --> 00:29:00,360 Speaker 2: Yes, it's it's very interesting, right. So I out of 476 00:29:00,360 --> 00:29:05,400 Speaker 2: callers and I went to work in public accounting. I 477 00:29:05,600 --> 00:29:07,760 Speaker 2: left public accounting and went to work for a client 478 00:29:07,760 --> 00:29:10,720 Speaker 2: that was a geothermal power producer, where I thought it 479 00:29:10,760 --> 00:29:12,760 Speaker 2: was going to be really exciting to find a way to, 480 00:29:13,440 --> 00:29:16,040 Speaker 2: you know, do this really neat thing, which is to 481 00:29:16,080 --> 00:29:18,560 Speaker 2: create power by pulling steam out of the ground. Turns 482 00:29:18,600 --> 00:29:22,880 Speaker 2: out it was very expensive and the way that the 483 00:29:22,920 --> 00:29:25,320 Speaker 2: team before me had set up their contracts it was 484 00:29:25,880 --> 00:29:28,840 Speaker 2: not doing a great job. So I got a call 485 00:29:28,960 --> 00:29:30,920 Speaker 2: from a company just down the street who had just 486 00:29:30,960 --> 00:29:34,840 Speaker 2: gone public and realized that they needed maybe some additional 487 00:29:35,520 --> 00:29:40,000 Speaker 2: firepower around you know, public reporting, FEC reporting, And so 488 00:29:40,080 --> 00:29:42,720 Speaker 2: I got a call and I showed up, and I 489 00:29:42,800 --> 00:29:46,280 Speaker 2: will stay probably in my first thirty to forty five 490 00:29:46,360 --> 00:29:49,920 Speaker 2: days being at Greenbrier and sitting with people who were 491 00:29:49,960 --> 00:29:54,280 Speaker 2: talking about things like car hire and all these other 492 00:29:54,400 --> 00:30:00,280 Speaker 2: weird words that are associated with rail power movements, about 493 00:30:00,280 --> 00:30:03,120 Speaker 2: what in the world have I done, but it was 494 00:30:03,160 --> 00:30:06,640 Speaker 2: an exciting time. The company was evolving. It was thinking 495 00:30:06,640 --> 00:30:12,240 Speaker 2: about how do we expand our footprint. We have manufacturing, 496 00:30:12,440 --> 00:30:15,680 Speaker 2: we also had leasing, So when I had slow periods 497 00:30:15,680 --> 00:30:19,440 Speaker 2: in between you know, my SEC reporting, I could spend 498 00:30:19,440 --> 00:30:23,360 Speaker 2: time with other parts of the organization learning more about 499 00:30:24,440 --> 00:30:28,000 Speaker 2: freight rail and I found it to be really interesting. It's, 500 00:30:28,640 --> 00:30:32,840 Speaker 2: as I said earlier, everything that's in whatever room people 501 00:30:32,880 --> 00:30:37,120 Speaker 2: are in right now listening to this, at some point 502 00:30:37,160 --> 00:30:40,080 Speaker 2: in time in its lifestand is in a rail cart, right, 503 00:30:40,160 --> 00:30:43,400 Speaker 2: whether it was the raw materials to create it, or 504 00:30:43,440 --> 00:30:47,080 Speaker 2: once it gets used to the point that we decided 505 00:30:47,120 --> 00:30:48,640 Speaker 2: that we need to throw it away and it shows 506 00:30:48,680 --> 00:30:51,240 Speaker 2: up in a dump, it ends up in a waiste car, right, 507 00:30:51,280 --> 00:30:57,560 Speaker 2: So there's all. It's endlessly fascinating to me how this 508 00:30:57,720 --> 00:31:02,920 Speaker 2: industry is connected to so many difference products and that 509 00:31:03,000 --> 00:31:06,120 Speaker 2: gives new access to so many different customers and learn 510 00:31:06,200 --> 00:31:09,760 Speaker 2: about what they're doing in their business, what challenges they have. 511 00:31:11,400 --> 00:31:16,160 Speaker 2: And it's just been a never ending learning opportunity. 512 00:31:16,760 --> 00:31:18,560 Speaker 1: And if you had to summarize kind of what your 513 00:31:18,560 --> 00:31:22,920 Speaker 1: customers are telling you about, you know, the possible direction 514 00:31:23,040 --> 00:31:26,520 Speaker 1: of the economy, how would you characterize that. 515 00:31:26,960 --> 00:31:29,120 Speaker 2: What I've heard from a lot of our customers is 516 00:31:29,200 --> 00:31:36,000 Speaker 2: there's again concerns about trying to understand how tariffs or 517 00:31:36,040 --> 00:31:42,000 Speaker 2: other rules might be impacting their inbound or outbound transportation needs. 518 00:31:42,600 --> 00:31:45,440 Speaker 2: But quite honestly, I think we've kind of hit the 519 00:31:45,480 --> 00:31:48,000 Speaker 2: point where we're Greenberg as well as a lot of 520 00:31:48,000 --> 00:31:50,520 Speaker 2: our customers. We're saying, we're just going to get comfortable 521 00:31:50,880 --> 00:31:55,080 Speaker 2: living and working and engaging in a world where there's 522 00:31:55,600 --> 00:31:58,920 Speaker 2: less certainty thing would life right. So people like, if 523 00:31:58,960 --> 00:32:01,000 Speaker 2: I'm waiting for there to be certainty before i can 524 00:32:01,040 --> 00:32:04,160 Speaker 2: make some business decisions, that's silly. I can't do that. 525 00:32:04,280 --> 00:32:06,480 Speaker 2: I needed to start running my business the best way 526 00:32:06,480 --> 00:32:09,959 Speaker 2: I can. I think one of our you know, some 527 00:32:10,040 --> 00:32:13,000 Speaker 2: of our secret sauces because we've got great procuremid people 528 00:32:13,040 --> 00:32:16,280 Speaker 2: who work with our suppliers, so that as we're navigating 529 00:32:16,320 --> 00:32:19,640 Speaker 2: any changes to our supply chain, we can have those 530 00:32:19,640 --> 00:32:23,160 Speaker 2: discussions and again working with our customers on their needs. 531 00:32:23,160 --> 00:32:25,960 Speaker 2: So I see it more as we're in this together 532 00:32:26,280 --> 00:32:31,280 Speaker 2: to figure out how to navigate the current economic environment. 533 00:32:31,840 --> 00:32:33,560 Speaker 1: Well, Laurie, I really want to thank you for your 534 00:32:33,560 --> 00:32:34,440 Speaker 1: time and insights. 535 00:32:34,720 --> 00:32:36,920 Speaker 2: Thank you for having me on. I appreciate it. 536 00:32:37,040 --> 00:32:39,040 Speaker 1: Yeah, it was my pleasure and I want to thank 537 00:32:39,040 --> 00:32:41,200 Speaker 1: you for tuning in. If you liked the episode, please 538 00:32:41,200 --> 00:32:44,360 Speaker 1: subscribe and leave a review. We've lined up a number 539 00:32:44,360 --> 00:32:46,480 Speaker 1: of great guests for the podcast, so check back to 540 00:32:46,480 --> 00:32:50,920 Speaker 1: here conversations with C suite executives, shippers, regulators and decision 541 00:32:50,920 --> 00:32:53,840 Speaker 1: makers within the freight markets. Also, if you want to 542 00:32:53,880 --> 00:32:57,040 Speaker 1: learn more about freight transportation markets, please check out our 543 00:32:57,040 --> 00:33:00,720 Speaker 1: work on the Bloomberg Terminal at BIGO and on social media. 544 00:33:01,080 --> 00:33:03,320 Speaker 1: This is Lee Clasgow signing off and thanks for talking 545 00:33:03,360 --> 00:33:06,320 Speaker 1: transports with me. Talk to you soon. Bye.