Brian Roberts: And I’ll just add that the second half of the year, Luke, to your question, we do have the product launches coming up for TPMS within HVOR. That’s driven by regulation in Europe. So, that one makes us feel a little bit better about that one. The leak detection in HVAC, we expect to see — continue to see ramp up given where we are and what demand looks like there. So as we’ve gone through this process, I mean, we certainly and Jeff mentioned it in his remarks, it’s important that we make sure that we’re executing well against what we’re saying. And so, I think it’s fair to say that we’ve tried to build in a level of conservatism into the forecasting. Obviously, we’ll continue to watch third-party data as it goes and adjust if required, but we feel pretty good about it today.
Jacob Sayer: Thanks, Luke, for the question.
Operator: The next question comes from Shreyas Patil with Wolfe Research. Please go ahead.
Shreyas Patil: Hey. Thanks a lot for taking my question. In wondering if you could talk a little bit more about the productivity actions that you’re looking to take this year and how to think about that relative to the impact of contractual price reductions? You mentioned those are starting to come back. I believe they’re typically around 1% to 2% annually. So, just trying to think about how the two will you be looking to offset those price reductions through productivity this year? Thanks.
Brian Roberts: Sure. No, great question. Thank you. So, I mean, the first, I would say is we have been investing continuously over the last couple of years in capital expenditures driven around customer needs for our lines and facilities, but also to be able to gain efficiencies and improve automation levels. And so that’s certainly an area that we think is going to help us kicking in here in the second half of the year, to be able to find those gains and find productivity. Again, certainly in an environment that’s more normalizing to kind of an OEM price down environment, we’re working with our suppliers already on what that means around material costs. Again, it’s going to take us a little bit of time to work through higher cost capitalized inventory.
So, that’s a little bit more of a headwind in the beginning of the year. But again, as we talk about the sequential margin improvement in the back half of the year, we think that’s certainly a helper for us. And as Jeff noted also, we think exchange rates normalizing gives us a little bit more benefit there as we’re continuing to purchase.
Jeffrey Cote: Yeah. And the only other thing I would mention is on the pricing side. So, we talked about a return to more normal environment. We’re not expecting 1.5% price down in 2024, but the trend is going in a direction from where we were seeing significant price up to more neutral on pricing. So, we don’t have to bend the cost curve completely, but we are trying to get ahead of the curve in terms of bending the overall COGS cost line to be prepared for that transition back to the normal environment, where we would see that 1%, 1.5% price down in productivity to offset it.
Jacob Sayer: Thank you, Shreyas, for the question.
Operator: The next question comes from Amit Daryanani with Evercore. Please go ahead.
Amit Daryanani: Yeah. Good morning, everyone. I have two as well. I guess the first one, Jeff, I’m hoping you can just talk about what do you think the path to 21% operating margin looks like today. And is there a revenue run rate or a combination of that and cost reduction that you need to get there? And just what the contribution of those two buckets would look like?
Jeffrey Cote: Yeah. So, volume helps us tremendously. There’s no question about that. But with 2%, 3% expected revenue growth, we can’t count on that right now. So, we’re going to do all of the other productivity measures that Brian talked about to try to get more productivity to offset the pricing impact at some point. And things are starting to turn a little bit in terms of the strength of the U.S. dollar versus those long currencies. So the fact that we are, for the full year, are not going to have a big impact or a headwind associated with what’s going on there is going to be extraordinarily helpful in terms of the overall benefit that we experience. But it’s the combination of those things that are going to allow us to do that.
Longer-term aspects of the profitability of the business mix, but we do that really well. We have a dozen or so very large product families where we have product roadmaps that we’ve built that are multi-year roadmaps, that will get us to better profitability in the mix of business. We’ve talked pretty extensively on prior calls regarding the fact that our electrification business is lower margin at the net margin level. But at the gross margin level, it’s more comparable to the company margin. And so as that investment profile reaches equilibrium, we’ll start to see a better drop-through in terms of overall margin profile.
Jacob Sayer: Thank you, Amit, for the question.
Operator: The next question comes from Joe Giordano with Cowen. Please go ahead.
Joseph Giordano: Hi, guys. Morning.
Jeffrey Cote: Good morning.
