Lear Corp at Morgan Stanley Laguna Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : We're going to give Lear management a chance to kind of address and provide a little market update and trading update heading into the end of the third quarter. And then we're going to focus a lot of the discussion around automation and seeding and kind of how Lear is taking advantage of new technologies to produce some margin as this industry doesn't get any easier, but if you have more tools and use AI to help improve your efficiency across your operations, that it's going to make a really big difference. So maybe Jason, over to you just to kind of kick things off and any statement you want to make upfront.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Great. I'm going to -- we're going to get into some more operational targets. I want to go straight to automation, actually, just since you teed it up. And that we've got Frank here to also kind of delve into the -- how you're using these tools on the seeding side, and we can bring in any other topic. But what is your broad view just for the audience on how AI will impact the auto industry and how Lear is using AI tools? You've got a high level, talk about that existing tools and kind of your direction of travel on automation and then I'll kind of double a little deeper.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : And Jason, has this changed your CapEx outlook? I mean, you have to -- there are costs to achieve and acquire these technologies that you then implement upfront. So how do we think about how this changes CapEx? Or how do you think about payback periods?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Clearly, reallocation.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : I got a couple of questions here before I turn to William. But William, talk about one of Williams, PA investments, Palantir, you mentioned, yes, it's -- his hit rate is not amazing, but (inaudible) it's pretty good. Tell us about that relationship. Who approach who? What's it like working with Palantir at the risk of giving away secrets because everyone else want to work with them, too. But just tell us what they're like and how they took your systems and data and helped you make decisions that create better outcomes?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : He mentioned, the culture is the same. I'm like, really?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : And they're cross the organization. It's not just limited facilities. It's not a pilot. They're embedded.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : All right. One more for me on this because I just kind of -- you mentioned automating a module assembly and kind of bring in some customers and showing them what you're doing. Presumably, there's very low scale, more demonstration, proof of concept, right? I'm curious, a, who are your benchmarks? I mean from my seat, Autoliv gets mentioned a lot, and you increasingly in the same breath with them, which is a good thing because Autoliv's -- they're damn good company. And they've got and they did things in automation that no one believed in terms of their initiators and module assembly here in high-cost countries, taking a lot of labor out and bringing in great results and doing what, just executing. I don't know if they were a benchmark. If they were, how close were you to be seeing what they do and then what other benchmarks do you see? And then in terms of really scaling these things? And then how long would it take for -- what's your outlook for you getting from a kind of demonstrating proof of concept to really integrating like fully automated module or almost fully automated module assembly into your broader operations.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : What's the human degree in the loop? How about -- you mean, zero human? What would that operation be before the automation? What would the pre-automation human component to be in terms of either people or labor as a percentage of the costs?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : You wouldn't be able to do it.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : William? Unidentified Participant I think we talked a lot about the cost side of automation. It's very obvious, the cost savings in automation, but does it even help on the revenue side? Your ability to win new business improve that you're more reliable and maybe scale a bit better than maybe some of your competitors?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : William, I just want to step on that point. Do you think that the US and European legacy automakers can narrow the gap to China on those areas of speed and iteration?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Of course. That's why I'm checking your body language more than anything.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : I just want to see if there's a question, come off air for a second. Any questions from the audience? Two minutes left. With just a couple of minutes left, I wanted to kind of hit on a bunch of topics kind of more rapid fire, if that's all right?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Did I ask you about that already? I moved on to Lady Gaga. Lady Gaga is like my obsession now as my team will tell you. Share a little bit about me that you didn't know. Frank, buy, sell, hold, humanoids?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Okay. Why?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Buy, sell, hold, Mexico.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Okay, elaborate

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : A couple more for you. Buy, sell, hold, China OEMs coming to the US market in some way over a 10 year period of time. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2025 / 5:00PM, LEA.N - Lear Corp at Morgan Stanley Laguna Conference

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Frank, EV tolls for aviation. Buy, sell, hold?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Aviation, EV toll, urban air mobility. Drones that would see.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Alright. This is the last one for me. What's your favorite sea of any kind. They're all great. I know every seat that you make is great.

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : But if you had to like -- if you had to be in a 12 hour journey, okay, what would be the seat? What's the model? What is it? What's the massage feature?

Question: Adam Jonas - Morgan Stanley & Co Ltd - Analyst : Jason, Frank, thanks for your time.