The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Ken Hoexter - BofA Global Research - Analyst
: Brian, Michael and Lorie and Justin congrats on 19 years. Can you talk a little bit about the downshift in the production? Is that solely -- it sounded
like, Lorie, you were saying it's not due to the closure in Europe, you can maintain that. Is that is that shift down to 5,000 units in the back half of
the year quarterly? Is that just due to decreased demand? I just want to understand what the message on the lower the units increased the margin
opportunity is?
Question: Ken Hoexter - BofA Global Research - Analyst
: Wonderful. I mean, great job. I mean you definitely talked about the insourcing and executing on that. So I guess, just maybe switching over to the
leasing for a second. Can you talk about the -- well, on the production, any -- is there -- I think you opened up with comments about the tariffs.
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APRIL 07, 2025 / 9:00PM, GBX.N - Q2 2025 Greenbrier Companies Inc Earnings Call
Is there something we should expect in terms of costs? I know it's a full pass-through in terms of if you're shifting from Europe to Mexico. I guess,
is there any impact on tariffs? And then any impact on the falling rates on the returns for leasing?
Question: Ken Hoexter - BofA Global Research - Analyst
: Just -- I don't want to dominate, but just a quick follow-up there. You mentioned the pricing on the new build is holding steady. I just want to
understand because the -- I guess the average sell price just looking at the $400 million and the $3.1 billion in backlog, it seems to be -- I'm sorry,
3,100 new cars added, would be about 129,000 ASP per car, which would be down 6% sequentially. So you're saying that, that is just solely mix
and not anything on price?
Question: Harrison Bauer - Susquehanna Financial Group, LLP - Analyst
: Great. Your working capital investment in leased railcars held for syndication rose each of the last two quarters. How are your customers in the
syndication channel reacting to this uncertain environment? And how much visibility do you have into syndication sales over the next few quarters?
Question: Harrison Bauer - Susquehanna Financial Group, LLP - Analyst
: Great. And maybe on the secondary market, more broadly and how that's behaving. Anything specific on the price of lease attached cars, market
depth, and liquidity that would be helpful.
Question: Ken Hoexter - BofA Global Research - Analyst
: Just want to squeeze a follow-up in. In the release, you kind of lowered CapEx. Can you maybe talk a little bit about what's being pulled out?
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APRIL 07, 2025 / 9:00PM, GBX.N - Q2 2025 Greenbrier Companies Inc Earnings Call
Question: Ken Hoexter - BofA Global Research - Analyst
: Okay. So the lease fleet stays at the $300 million and so it's just pulling out of manufacturing?
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