Mark Newton - Senior Vice President Steven Downing - Chief Financial Officer Kevin Nash - Chief Accounting Officer.

David Leiker - Robert W. Baird & Co. Richard Michael Kwas - Wells Fargo Securities, LLC Ryan Brinkman - J.P. Morgan Brett Hoselton - KeyBanc Brad Erickson - Pacific Crest Securities Steven Dyer - Craig Hallum Jason Rogers - Great Lakes Review David Whiston - Morningstar John Murphy - BofA Merrill Lynch.

Good morning, ladies and gentlemen. Welcome to the Gentex Fourth Quarter Earnings Conference Call. Today’s conference is being recorded. I would now like to turn the meeting over to Mr. Mark Newton, Senior Vice President. Please go ahead, Mr. Newton..

Thank you very much. Good morning and welcome to the Gentex 2014 Fourth Quarter and 2014 Calendar Year Earnings Release Conference Call. Also here is Steve Downing, Chief Financial Officer and Kevin Nash, Chief Accounting Officer. This call is live on the Internet by way of an icon on the Gentex website at www.gentex.com.

All contents of this conference call are the property of Gentex Corporation and may not be copied, published, reproduced, rebroadcast, retransmitted, transcribed or otherwise redistributed.

Gentex Corporation will hold responsible and liable any party for any damages incurred by Gentex Corporation with respect to any unauthorized use of the contents of this conference call.

This conference call contains forward-looking information within the meaning of the Gentex Safe Harbor statement included in the Gentex Reports Fourth Quarter and Year-End 2014 Financial Results press release from earlier this morning and as always shown on the Gentex website. Your participation in this conference call implies consent to these terms.

Now to Steve Downing for the financial summary..

Thank you, Mark. For the fourth quarter of 2014, the company reported net sales of $350.4 million, which were up 7% compared to net sales of $326.8 million for the fourth quarter of 2013.

The sales level on the fourth quarter was behind our beginning of the quarter forecast primarily due to end-of-year inventory adjustments at certain Tier 1 customers that is not expected to continue. For calendar year 2014, the company's net sales increased 17% to $1.38 billion, compared to $1.17 billion for calendar year 2013.

Gross profit margin in the fourth quarter of 2014 was 38.4%, compared with the gross profit margin of 39.4% in the fourth quarter of 2013, primarily due to higher than expected manufacturing costs related to new technology launches.

The company’s inability to leverage fix overhead costs because of the lower than anticipated sales levels and annual customer price reductions, which were not fully offset by favorable purchasing cost reductions and improvements in product mix.

The gross profit margin for calendar year 2014 was 39.2%, compared with a gross profit margin of 36.8% for calendar year 2013, primarily due to favorable shifts in product mix, the impact of the HomeLink acquisition and purchasing cost reductions, which were partially offset by annual customer price reductions.

Net income for the fourth quarter of 2014 was $71 million, up 2%, compared with net income $69.9 million in the fourth quarter of 2013. Net income in calendar year 2014 was $288.6 million, up 29% compared with net income of $222.9 million in calendar year 2013.

After adjusting for the stock split, earnings per diluted share in the fourth quarter of 2014 were $0.24, which is unchanged from the fourth quarter of 2013. Earnings per diluted share were $0.98 for calendar year 2014, compared with $0.77 for calendar year 2013.

Automotive electrochromic mirrors unit shipments in the fourth quarter of 2014 increased 9% compared with the fourth quarter of 2013, primarily due to increased unit shipments of both the company’s interior and exterior auto-dimming rear-view mirrors in all of the company 's primary markets.

Automotive net sales in the fourth quarter of 2014 was $342.4 million, up 7% compared with automotive net sales of $320.3 million in the fourth quarter of 2013. Automotive electrochromic mirror unit shipments for calendar year 2014 increased 11% compared to calendar year 2013.

As a result, automotive net sales for calendar year 2014 were 1.34 billion, up 17%, compared with automotive net sales of 1.14 billion in calendar year 2013.

Other net sales, which include dimmable aircraft windows and fire protection products were $8 million in the fourth quarter of 2014, up 24% compared with $6.5 million in the fourth quarter of 2013 and for calendar year ‘14 were $35.4 million, up 27% compared with $27.9 million in calendar year 2013.

In December 2014, the company completed a 2-for-1 stock split affected in the form of a 100% common stock dividend entitling each shareholder of record to receive one additional share of common stock for each outstanding share of the company 's common stock, par value $0.06 per share.

This stock dividend was issued on December 31, 2014 to shareholders of record at the close of business on December 17, 2014. All share and per share items represented in this conference call reflect the 2-for-1 split.

During the fourth quarter of 2014, the company repurchased 1.1 million shares of its common stock at a cost of approximately $20 million. For the year ended December 31, 2014 the company repurchased 1.8 million shares of its common stock at a cost of approximately $30 million.

The company may in the future repurchase additional shares of its common stock, depending on macroeconomic issues, market trends and other factors that the company deems appropriate, with the shares that remain available from our previously announced share repurchase plan. Now to Kevin Nash with some of the Q4 2014 details..

Thank you, Steve. E, R&D expense for the fourth quarter of 2014 increased 10% to $21.8 million compared to the fourth quarter of 2013 and also increased 10% for calendar year 2014 to 84.2 million, compared with 76.5 million for calendar year 2013.

The primary driver for both the quarter and full year was increased staffing levels, which continued to support growth and development of new business.

SG&A expense for the fourth quarter of 2014 increased 8% to $14.3 million, compared to $13.2 million in the fourth quarter of 2013, due to increased staffing benefits as well as promotional and advertising costs.

SG&A expenses for calendar year 2014 increased by 13% to $55.9 million when compared to $49.5 million for calendar year 2013, primarily due to amortization expense related to the HomeLink acquisition.

Other income for the fourth quarter of 2014 was $5.4 million, down from $8.5 million in the fourth quarter of 2013, primarily due to lower realized gains on sales of equity investments.

For the calendar year 2014, other income was $16.5 million which was also down from $23.3 million in calendar year 2013, also primarily due to lower realized gains on sale of equity investments during the year.

The effective tax rate for the fourth quarter of 2014 was 31.8%, which varied from the statutory rate of 35% primarily due to the domestic manufacturing deduction in the full year of estimated research and development tax credits of approximately 3 million, which was passed into law in late December 2014.

For the full year, the effective tax rate was 30.5%, which also varied from the statutory rate due to the domestic manufacturing deduction and incremental research and development tax credits related to amended tax return filings for calendar years 2010 through 2012 of 5.5 million, as well as incremental benefits realized as part of the original 2013 tax return filing of approximately 1.8 million, plus the previously mentioned 3 million for 2014 for a total benefit of $10.3 million in the calendar year.

Now to the few balance sheet items. Cash and cash equivalents were $497.4 million, up from $309.6 million as of December 31, 2013, primarily due to cash flow from operations, which for the fourth quarter was $99.8 million, compared to $93.7 million in the fourth quarter of 2013, driven by increases in net income and changes in working capital.

Year-to-date cash flow from operations was $327.2 million versus $317.3 million in 2013, also driven by increased net income and changes in working capital.

Accounts receivable was $168 million as of December 31, 2014 up from approximately $143 million as of December 31, 2013 primarily due to higher sequential sales level as well as the timing of sales within the quarter.

Inventories were $141.8 million, up from $120.1 million as of December 31, 2013, primarily due to increases in raw materials inventory in support of increased sales levels. Long-term investments were $114.6 million versus $107 million as of December 31, 2013. Accrued liabilities were $62 million versus $63.5 million as of December 31, 2013.

Capital expenditures for the fourth quarter were $22.5 million compared with $17.4 million in the fourth quarter of 2013 and capital expenditure for the year was $72.5 million versus $55.4 million in 2013. Depreciation and amortization expense for the fourth quarter was $17.6 million and $77.4 million for the full year.

And lastly, on January 20, the company paid a quarterly cash dividend of $0.08 per share to shareholders of record of the common stock at the close of business on January 07, 2014. And now to Mark Newton for a product update..

Thanks, Kevin. Steven, Kevin and I have been communicating with analysts and investors for a little over a year now in an intangible effort to learn how to better address the important questions that you have.

In that effort we have worked to provide more detail on all of our products, the history of those products and their product development and how all of these products affect our business and our growth opportunities.

In this communication with analysts and investors, we have learned that the most common request is for Gentex to provide a longer view on products and how they affect growth, and we heard you.

So in response to this, starting now we will provide annual product guidance in an effort to give a better understanding of where our growth comes from in the next year. 2015 production and sales includes the largest launch of new products in our company history. First product, frameless.

In 2015 new frameless interior mirrors with advanced styling to diminish the front bezel has rolling and launched in production with multiple customers. Frameless interior mirrors allow for advances in electronics and displays consistent with what you see on the latest smartphones, tablet devices and computers.

Our recently announced full display mirror is just one example of a new frameless application. Frameless is an entire product upgrade for our interior mirrors, bringing with it new applications for our mirrors in the market. Frameless interior mirrors grow to almost one third of Gentex inside mirror unit production by 2017. Next, outside mirrors.

Outside mirrors have been a leading contributor to our growth in recent years, and they will continue to be in 2015. Gentex outside auto-dimming mirrors work by interfacing with our insight auto-dimming mirrors. The global average application rate for Gentex inside mirrors is 25% of vehicles produced.

The global average application rate for Gentex outside mirrors is 7%. Everywhere we have an inside auto-dimming mirror is therefore a potential for our outside mirrors to be applied. As such, we have been and we will continue to emphasize our sales focused on outside auto-dimming mirrors.

HomeLink; advanced electronic applications represent over half of our sales. Our largest advanced electronic application is HomeLink. HomeLink in the mirror and HomeLink modules outside the mirror in consoles and visors.

In 2015 HomeLink will again be our largest advanced electronic feature with a long-term product plan that should result in growth opportunities for this product over the next several years. Many of these new HomeLink applications in 2015 are also part of a Gentex frameless interior mirror product.

HomeLink is a vehicle to home automation feature consisting of a vehicle integrated program over buttons that can operate glass doors, security gates, home lighting and other radiofrequency controlled devices.

In 2015, we also began shipping HomeLink to new market applications expanding beyond traditional automotive to new vehicles, including all-terrain, off road, agricultural, construction and a wide variety of other vehicles.

SmartBeam; our second largest advanced electronic application is SmartBeam, and in 2015 it will continue to be, growing at a faster rate than our overall corporate average.

This is due to SmartBeam generation IV, which fully rules out in 2015 on multiple vehicles, replacing our SmartBeam generation III application and also growing on to new vehicles that have not previously had SmartBeam. The new SmartBeam generation IV applications are also part of the Gentex frameless interior mirror product launch.

For over a decade, we have been shipping SmartBeam with nearly 7 million systems shipped detecting lights, detecting road conditions and detecting objects as part of the vehicle driver’s system.

Gentex generation IV is a family of SmartBeam products with features that include high beam assist, dynamic forward lighting with high beams constantly on, LED matrix beam, and such ADAS functions as lane detection, object dictation and collision detection.

Gentex has long been integrating its SmartBeam capable products in the vehicles including optimizing performance by fusing with multiple vehicle electronic systems including radar, navigation, steering and related modules provided by other industry leading automotive electronic suppliers which enables Gentex to provide its automaker customers with a highly customizable solution that meets their unique needs and specifications.

Full display mirror; a new advanced electronic application for Gentex is the full display mirror. The full display mirror begins production in the fourth quarter of 2015. When it comes to driving safety, seeing much behind you in rear-view mirror is critical.

Current design trends, however, are yielding vehicles with smaller rear windows that are often fully obstructed by headrests, passengers, and wheel support pillars. These factors can significantly hinder the mirrors’ rearward view.

The Gentex full display mirror is an intelligent rear vision system that uses accustomed externally mounted video camera and a mirror integrated video display to optimize a vehicles rearward view.

This new Gentex rear vision system consists of a hybrid full display mirror and accustomed Gentex designed camera engineered specifically for automotive vision. The mirror offers bi-modal functionality. In mirror mode, the product functions as a standard electrical rear-view mirror.

During night time driving, digital light sensors talk to one another via a microprocessor to automatically darken the mirror when glare is detected. But with the flip of a switch, the mirror enters display mode, and a clear, bright, LCD display appears through the mirror's reflective surface, providing a wide, unobstructed rearward view.

The two modes are essential because should the camera or display become non-operational, the product can operate as a standard mirror. The driver can also switch between modes to accommodate usage preferences for various weather and lighting conditions and driving tasks.

Video Cameras; another new advanced electronic application for Gentex is video camera. With the full display mirror, automotive video for rear vision requires a camera with high dynamic range, which is the ratio between the brightest and darkest areas of a given scene.

The challenge is to display the details in the darkest and brightest areas of a given scene simultaneously, without causing the display to washout due to bright light sources. The new Gentex video camera system meets this challenge in a unique way, with a Gentex designed proprietary CMOS imager that delivers unprecedented dynamic range.

This new imager allows each individual camera pixel to choose its own exposure, self-adjusting so that the brightest and darkest areas of any given scene are clear and visible. This is the same imager that we use in the generation IV SmartBeam product.

As a family of camera products with features that include high-beam assist, dynamic forward lighting with high beams constantly on, LED matrix beam, and such ADAS functions as lane detection, object, and collision detection and there is a new and there is a new generation V imager in development and launch for future applications.

Gentex is also awarded business for expertise in camera integrations in vehicle mechanically and electrically. SmartBeam cameras are integrated into the interior rear-view mirror.

Gentex video cameras can integrate behind rear window, in the rear spoiler, in the trunk lid, in the roof-mounted shark-fin antenna, into the high-mounted stop lamp, into tail gates, into license plate holder, in the outside mirrors, front grills, bumpers and many other locations either individually or as part of a multiple video camera system.

Our cameras are ultra-lightweight, aerodynamically optimized and can be heated and coated for better performance [indiscernible] conditions. These products are the growth drivers for the business in 2015. They were awarded and launched in 2012. In 2012, we were 1.1 billion in sales with 33.9% gross profit, $168.6 million net income.

Today, we are 1.38 billion in sales with 39.2% gross profit and $288.6 million net income.

These 2015 new products are designed to sustain this growth momentum and allow us to target new growth and electronic vehicle communication with HomeLink, new growth in electronic driver systems with our camera systems, new growth in vehicle safety and information systems with our new auto-dimming mirror technology and new display systems.

Now back to Steve Downing for future guidance..

Thank you, Mark. As a company, we have been working hard to do a better job of explaining the business, which includes more discussions on all of our products and the featured growth drivers of the business.

The first step in that process was to spend time during the last year discussing the breadth and depth of the product line up and how that has driven growth over the last several years and then to use that baseline as a leverage point for discussing our longer term growth strategies.

Our product updates are intended to move us in that direction by giving shareholders a better picture of where we are investing the research and development dollars, so that you have a better information regarding the growth drivers of the business.

The company has also been working diligently to provide better and more relevant financial information regarding our long-term growth strategies and goals.

As part of that evolution, we will now be providing annual sales and gross margin guidance in addition to other key annual guidance figures with quarterly updates to through [ph] up our annual guidance in each of these areas.

Based on the January 2015, IHS production forecast, which for the major regions of the world that the company serves is expected to be flat versus 2014. The company estimates that net sales for calendar year 2015 will be between $1.47 billion and $1.54 billion.

The company also estimates that the gross profit margin will be between 38.5% and 39.5% for calendar year 2015.

Operating expenses, which include E, R&D and SG&A expenses are expected to be between $150 million and $157 million for calendar year 2015, demonstrating continued [indiscernible] manage growth of expenses inside of targeted sales growth while continuing to reinvest in the business.

The company expects that the effective tax rate will be between 31.5% and 32.5% for the year. Based on the previously announced facilities projects and expected growth in unit shipments, the company is expecting a capital expenditures will be in the range of $95 million to $105 million for the year.

Depreciation and amortization is expected to be approximately $85 million to $90 million for the year. Thanks for your time and we can now proceed to questions..

[Operator Instructions] And we'll go first to David Leiker with Baird..

Good morning everyone..

Good morning David..

I want you to start and see if we can flush out some of the details of these factors in the fourth quarter, new launch cost, size, amount, timing, how long they’re going to be around and then impact of the exterior mirror inventories correction that your tier 1 customer went through?.

So I am assuming you want just cover all those David or do you want to ask some more specific questions first? Or do you want to just kind of go through them?.

Yes… I think… good understanding of what the financial impacts were of those two factors in the quarter..

Sure. So I will start with sales side and if you look at a couple of factors, first we'll talk about actual production in Q4 and if you look at Q4 production levels, they were about 2%, roughly down for the year on a year-over-year basis for Q4 and our sales were up 7.

So we actually we beat the market by about 9% from a growth standpoint, which is roughly in line with what we targeted. We talked publicly about the double-digit growth goals for the company.

If you look specifically at D&E segment globally, well really if you look at it in the three major areas that we operate in, so the one that we publish financial details around from a production standpoint. What you feel is that D&E was really down about 4% in that segmentation, which is based on our discussions we’ve had were highly consented.

So that was pretty much a headwind for us in the Q4 area. Additionally, what we had was the tier I adjustments.

This is uncommon for us in December, especially usually late November-December to have issues with tier I inventory adjustments because of the cycle time and lead time of those products and not knowing exactly what inventory levels are tier I customers are holding.

It is something that we deal with, usually on an annual basis, where you'll see dips in orders of our outside mirror products and now with the addition of HomeLink you also have risk there on the HomeLink side and that’s what we experience is just that our tier I customers were obviously trying to manage their inventories for year-end close, a little tighter and so the orders were strong.

We don't believe any of the things that we saw in November through December as related to the tier I orders, are indicative on a go-forward basis, we feel like, Mark, the sales guidance that we've been giving is right in line still..

Okay. Thanks. And then what about the launch costs of your…new product and technology launch cost if you can quantify what impact that had on margins..

Yes. So, if you look at…I’ll kind of start and then Kevin can add a couple of details there. But if you look at the overall manufacturing costs, what we saw a couple of million-dollar headwind in the quarter on manufacturing costs.

A good portion of that was obviously driven by the new technology launches that Mark has been discussing in his product section. There are a lot of things that we’re just launching this year and going into 2015. So they were the primary drivers of that.

Obviously, the sales level being slightly behind our forecast didn't allow us to leverage the overhead portion as well as we would've liked and like we mentioned that the higher sales levels that we've guided to for 2015, we believe that shouldn't be a problem [indiscernible].

Yes. The specific launch cost were probably between 50 and 100 basis points, David, if that suits your [indiscernible] that the 50 to 100 was a negative impact there..

So all-in-all, it looks like there are some mix issues and then the launch costs are the biggest issues here. And….

Yes. We had favorable mix that obviously helped, but then some of these things outweighed there in its order..

Okay. Great. Thanks. I will come back..

Thanks David..

Thanks David..

We'll go next to from Rich Kwas with Wells Fargo Securities..

Hi. Good morning. Just a follow-up on David's question, so when you look at the inventory destocking, Steve, how would you frame it between the impact of the exterior and then just a lower production on D&E segment in terms of the impact on sales.

Is there a ratio we should think of?.

Sure. Yes. We’ll start with the D&E segment. If you look at the units that sell out of the forecast, I mean that’s one of the production environment in the fourth quarter.

Given our content there and the average when you are dealing with D&E segment, you’re talking about the average between 2 meters and 2.5 meters for every one of those vehicles because of the inside and the outside mirror content we tend to have. And if you look at ASPs, that could have been anywhere from $7 million to $10 million.

And then if you look at the inventory adjustments, you are looking at another 7 to 10 roughly that took place in the quarter [indiscernible].

And now some of those are overlapping, so you can’t necessarily add the two together entirely because part of that inventory adjustments from the tier I was probably partially driven by the lower production, but not all of it..

Okay. And you feel at this point tier I customers have their inventories in pretty good shape..

Yes, typically. And this actually happens almost every year. It’s just a matter of how severe it is from time to time. But typically, they are trying to get their inventories in order for their end of year close and try to make sure they are holding a right amount of product as they close their year up.

And sometimes you will see more significant cut back in orders in that period. And then typically, you’ll see either strengthen or go back to normal as January rolls around..

Hi Rich. This mark and as I think we talked previously. When it comes to outside mirrors in the year-end issues with our tier I customers, it's no excuse on our part. We just missed it. We did missing in previous quarter is low on outside mirrors and had continually improving performance.

And in this particular case, this should be viewed as more of a one-time situation. That was specifically from a year-end..

Yes, I think important thing to remember is that we do have more risk to this now with the HomeLink acquisition because the part of the business that we acquired is all tier II business for us, in other words, all those component sale through a tier I sale.

Now, it’s not just our outside mirror business, it’s also the HomeLink business is subject to this type of inventory adjustment risk..

Okay and so bottomline it sounds like that GNET is a bigger piece of a sales mix than the inventory adjustment, rather fair comment..

Yes, I would say they are roughly about the same..

In terms of the guidance for gross margin, so the decline, can you frame this up in terms of what transitory versus, what’s sustainable/structural meaning how much of the impact here should get reversed as you move into ’16 and get more volume and leverage on the new products..

Well, I think if you look at, like we said before if you look at the overhead portion of it, I mean that’s the functional, how you are doing relative to your sales level.

So if the sales were responding, get back to the levels we believe that we have in ’15, then you would expect the overhead to move in line and to be obviously visible by a greater base. So that should help to smooth that out.

If you look at the other launch paths, I mean some of those will probably likely to continue in the ’15 but on the higher sales level that should help absorb those as well.

And then as we work through six months or so of launching this products typically what Gentex has done is a fantastic job of getting more efficient and getting yields off and not having -- and then the new things are occurring obviously, have issues over time and some of the other things that have to occur in order to hit your shipments.

So we look at and say hey, why half way through the mid-15 will be through a lot of those one timing issues on start up cost and start to produce the type of margins on those products that we’re accustomed to..

So does the guide include a 50 basis point to 100 basis point headwind similar to what you experienced in the fourth quarter related to launch cost, manufacturing efficiencies, etc. is that the –.

I think, like Steve indicated, we have some other factors early and then we are working to be more efficient throughout the year. But as we also know historically, January one is typically when we have [Indiscernible] to the customers right so we are factoring out in as well. .

Okay, all right..

And one of the other things that we have talked about [Indiscernible] is just that our supply base and then also our manufacturing costs are kind of spread out. Those efficiencies come in throughout the year. The pricing affect is on January 1. Some of the efficiencies are filtered in throughout the year.

So the year is not 100% consistent as it relates to the margins and back. .

So the way to think about, so from a Q1 standpoint, I know you’re going away from the quarterly guidance, from a Q1 standpoint. Similar impact on the large cost here in the near term and then you add in the price downs because of the normal [Indiscernible]..

That’s [Indiscernible], you got it exactly..

Okay, all right. And then just a bigger picture question, so Mark, appreciate all the commentary around the new products. Just to be clear, SmartBeam is going to grow faster than the overall corporate growth for ’15, is that [Indiscernible]..

SmartBeam and HomeLink on the electronic side have been and will continue to, generally the interest from what we are seeing for ’15 right now, and growth as we have been experiencing the last couple of year has increasing and had contributions in these areas, yes..

Okay, so faster than 7% to 12% range for the company as a whole, right. And then just a quick follow up on that point.

Can you give us any color around ADAS functionality? You referenced it in terms of SmartBeam but can you give us any flavor for what you are selling or what you are shipping right now that has ADAS functionality within the SmartBeam portfolio? The thing is that that’s one of the thing that people want to have more clarity from you in terms of the growth profile that business, and I understand that it’s a moving target you got right now.

But in behalf of you could provide in any color around that specifically. .

It’s not really a moving target. The SmartBeam generation IV product has from the outset, when we first began shipping at the end of the third quarter of last year, and now with the expansion this year, that product was created with this capability.

That’s important to know that for over a decade SmartBeam has been positioned as a mid-level option package beginning originally to control forward lighting and increasing in capability through fusion with radar and steering and other electronic systems on the vehicle and adding capability to detect lanes and roads and objects.

As you might easily imagine, we’ve been since the offset with the original SmartBeam. We’ve been detecting lights as we approach the vehicle. Those lights turns out [Indiscernible] vehicles and so it’s no stretch to [Indiscernible] that we have been detecting vehicles in all conditions.

In almost all of our applications where SmartBeam is applied we got a line of 17 different automakers worldwide where this is applied and it has continued to be a growing product as you know.

And each of those application there has been generally a high-end package of multiple feature drive assist consistent with Bosch or Continental or the Mobileye applications as well. We have been participating as a mid-level option and but there was a high-end option.

We publicly pointed out and like almost seven million units on the field, we’ve experienced that we had a much higher application take-rate in a more expensive multiple featured driver assist systems.

The good news today with the increasing market interest in success of applying more driver assist systems on the vehicle means -- and that the high end systems, multiple feature like the Continental or Bosch or rather Mobileye application with multiple features, those are increasing in application but so is ours.

We created SmartBeam now for over a decade together with customers adding feature capability to that customer request, not at our own free will. And doing so -- and so with this the generation IV SmartBeam that is shipping now and includes capability of features that detect objects and report that information to the car.

On high systems we are very sophisticated and near outstanding products that have applications that detects specifically pedestrians and detect vehicle and detect collision and detect road conditions, our product has been detecting vehicles and road conditions and objects in the sense so as the market broadens there are more applications generally from mid-range as well as the high end, and that’s basically what we’ve been developing and are experiencing growth..

You are seeing growth in ADAS, or ADAS functionality to [Indiscernible] within the SmartBeam portfolio..

The generation IV SmartBeam was specifically, we created the imager, we created the applications, then had customer request to add capability and lane and object detection as well as in lighting. And so, yes, those are driver assist functions and this were sending information to the vehicles.

We have been highly flexible in fusing with a wide variety of radar and steering and pitch and yaw and other sensors on the vehicle for some time, many years. So we’ve have been increasingly seeing more with our cameras sending more information to the car, integrating with more systems at customer request and that is ADAS.

ADAS doesn’t have to specifically be seven features, specifically defined as an application basis, actually quite broad and it is actually an application just beginning in the market [Indiscernible] so far good news is, there is great interest and it’s an opportunity for growth..

We will take our next question from Ryan Brinkman with J.P. Morgan..

Just on the tier 1 destocking this year again, did this relate to destocking of Gentex components that go into the supplier modules implying some sort of change in take rates or are [Indiscernible] more just a destocking of the completed modules because of lower production at the automakers for example..

Yes, what this is, is destocking of our outside mirror assemblies that we sell to the tier 1 outside mirror manufacturers. In other words, they buy our glass element or electro-chromic element and then they use those in their full outside mirror assemblies and basically it’s a timing issue and it’s an inventory management issue that they have.

And typically, and like I said we’ve experienced this almost every year. Actually we’ve been selling outside mirrors. Now it’s a little larger in terms of it’s a real dollar value, because of the HomeLinks are also tier 2 business for us, for are selling electronics module that are being added to visor and overhead console.

And so typically when you see this occur, it’s not a change in any type of take rate or any type of what’s going on with the core business it’s more just tier one customer trying to make sure that they have the right inventory levels as they head into the new year..

Hi Ryan this is Mark and typically as you might have imagined in this case it's a question of [indiscernible] shop to us between Christmas and New Year we are going to push the order out end of the New Year type situation as well it often happens..

I see. Okay. Great.

And then what are, in terms of take rates, average transaction pricing certainly vehicle [indiscernible] all time record highs, some of that might relate to several mix, so what are you seeing in terms of how vehicles are being contented and how is that impacting the business, in fact should commented on the changes by geography [indiscernible], what are you seeing there?.

I will start with all responses I think in this. Again this is Mark. As we have been saying publicly for some time the best surprise that we have enjoyed particularly in 2014, particularly in this year, rapid growth in the BMC segment in some compact and compact vehicles was traditionally did not have advanced electronic content like we provide.

That's been a great growth area for us in this and so that's driving a lot of the unit application growth that we have been experiencing over the past years and it is also reflected in new business awards that we have received for our future business in 2014, and we are excited to see more on the BMC side..

Probably that's the best place to see the evidence of that is if you look at the end of the that press release what you will see is content from inside and outside mirrors by regions both north America versus international and what you see it's consistent growth in all areas of our business.

In other words both an inside mirrors and an outside mirrors and in all region.

So one of the things we point you there is that we believe that some of the content that you are seeing at vehicle some of the average, higher average sales prices of those vehicles are helping us because we are one of the features that OEMs look to add to vehicle to make a to a to add a pricable option and b, to help content that vehicle specially they start to move down segment and as a shopper begins to look at lower segment vehicles, so it doesn’t necessarily mean [indiscernible] it is also a function of size, fuel economy and some of the other things we are seeing in the industry..

Okay. Thanks and just last question on the buyback, you did a second quarter in row after not having done it for a while, what should we enter from this and then can you comment on the stock split to and reasons for that..

Sure. So on the share repurchase side, like we said before I mean this is something that the company uses as an opportunity. We tend to be very situational, in other words we don't have a preformatted or stated strategy about when or how to execute stock buybacks but it is something that the company evaluates constantly.

On the stock split side, that was primarily a function of trying to make sure we are managing our stock option expense as it relates to the company. As the stock has been going up and value, one of the things that comes along with that as negative is that the option expense can grow.

The advantage of the stock split is it helps to minimize the growth in that area of the business. So it helps us control our cost in a more affective way..

All right. Thank you. .

We will go to Brett Hoselton with KeyBanc..

One, you obviously laid out quite extensively the products regarding your revenue growth, so thank you very much. That is very helpful.

My question is in the past few years you have kind of talked about 10% revenue CAGR plus or minus and this year 2015 regarding tier one 10% on average given roughly flat production and so forth , so that's fairly consistent.

My question is do you look across your broader product portfolio and if you look out into 2016, ’17 and ’18 or something on those lines, and you consider that 10% what's the bias on that gross rate.

In other words, do you think that that's just simply kind of remain kind of in 10% range, is there an upward bias or downward bias, do you see your product growth accelerating or decelerating or just remaining the same?.

All efforts on the company's part we are working to communicate again Brett this is Mark are to accelerate that growth but we always hesitate with caution primarily because we are sold as an option package as oppose to largely a standard equipment application because we are an option, we tend to vary a lot based on economic conditions in our various markets.

When the economies are good, since where and that had option that consumers must select, we tend to do well and the economics tends to slow in certain region we could move at to a more base out of newer product with a lower product mix which have been electronics and so that's where we tend to be cautious.

The message that I think you are pointing to and we do want to communicate is that the company increasingly in the leadership increasingly is pushing or accelerating that growth but we are not committing beyond the 10% at this point, one, because we continue to see a flat reduction environment and two, because we are an option and the situation that doesn't indicate large significance of the growth..

Excellent.

And then just the follow on the share repurchase, obviously you have got a growing cash balance and so I mean you kind of [indiscernible] repurchase my question is what do you think the possibility of maybe developing a more consistent let's say share repurchase plan as an oppose to opportunistic share repurchase plan, what do you think the possibility of that happening might be and if so do you have any sense of whether or not that's something that could possibly occur in 2015 or ’16, or ’17 what's your general thought there?.

I think overall when we look at share repurchase, historically the company has used the opportunistic approach and hasn’t done anything from the methodology standpoint that we drive to be consistent.

That's one of the things that we talk about very frequently here in terms of how do we leverage the balance sheet to make sure we are doing the right thing for the shareholder but hasn’t right now the strategy remains to be the same which is that we are going to look at this as an opportunity and we are going to be opportunistic in how we handle our share repurchases.

Like I said before, I mean the company always thinks that makes Gentex very unique is that we are opportunistic and we do look at thing, and reevaluate them all the time to make sure we are taking the right approach. So that's something that we debate internally and we do talk about and look at.

It's one of our focuses though that has always been on top line growth of actual revenue, not trying to drive EPS only to balance sheet but to look at it as how do we grow the business, invest in the business in such a way that we make sure we are driving the top line and then proving the shareholders that we all value through those need.

So it's one of the things that balance sheet is very important as [indiscernible] would point out, we did last year make a big step from an acquisition standpoint and so right now we are in that process and making sure being discipline with the business and driving efficiently so we can rebuild that balance sheet and then get ready for what is next..

And then finally as we think about your operating margin outlook, obviously you got an implied outlook let's say 2015 sort of and we cannot think about ’15 ’16, and ’17 the faster revenue growing products are seems to be higher margin that might be a nice tailwinds, it looks like you are not necessarily anticipating your sales growth to outpace your operating expenses, so not necessarily anticipating your sales growth to outpace your operating expenses so at least on that basis you don't necessarily get that kind of leverage but I am wondering kind of outside those two factors and correct me those assumptions are incorrect but what are the other mix in case with regards to your operating margins because that kind of seems like your margins are quite sustainable but there may be some opportunity for some upside there..

Sure and we will first of all start at the very highest level. Anything above 10% tends to be when we have the best opportunity to expand gross margin anything below that typically we are going to be more on the realm of maintain margins not expanding them. So that's the first factor.

The second one is on the take side is really when you look at annual customer price reduction, you are facing 2.5% to 3% on January 1, little bit later in the year but most of it at January 1 and so that's the big headwind for the company.

So our first goal is to get the purchasing group in line and manufacturing cost in line we try to offset those cost just to be able to maintain the margins that we are – that we posted in 2014.

Beyond that if you look at the operating line items, like we said, we try to be discipline with our expense growth there to make sure that we are not growing those that are rate faster than sales are growing but at any given point in time, that can outpace and that's primarily specially on the R&D side would be driven by customer order and need to develop in terms of our product launch to make sure that we are delivering products on time and so those are the things that can drive operating cost to outpace sales growth but for the most part if we can move as to roughly in line, then we are focused on our sales, a for selling the right products and like you mentioned, the things that will help us on the gross margin side to help us offset those cost reductions is the mix and for us the mix is HomeLink or outside mirrors or smart products, those are positive from a margin standpoint.

So at this stage and what you see in the longer term this one year gross margin guidance is stabilization in that gross margins and we believe if we can do that, that gives us some upside potential that will be predicated on our ability to grow faster than 10%.

So for growing anywhere around 10% or slightly lower you would expect hopefully margins stabilization anything that outpaces that is when we have our first opportunity to expand margins..

And just for one context we did come I mean in short period of time from low 20% operating margins from where we are today, the high 20s, 30s, 30% operating. .

Gentlemen, thank you very much..

Thank you..

We will take the next question from Brad Erickson with Pacific Crest Securities..

Hi, Brad..

Hi guys. Thanks for taking my questions.

First on HomeLink, can you just give a little bit more of an update on kind of how both the refresh is going particularly in the new geographies and then maybe also some of the new products like the non-automotive applications and kind of how those ramps are going relative to your commentary a quarter ago?.

I [indiscernible] the answer. The product release in the newer applications does begin to have primary launches starting in 2015 and in the new market, applications are specifically as we talked in China is a growing area for us those also begin later this year as well, both of them have been very-very positive.

Right now we are essentially just starting we are not giving specific guidance in those market areas beyond saying HomeLink continues to be our largest electronic applications and it is growing at and often above over the businesses product..

Yes.

I think like when we talk about a little bit before on the product side and Mark kind of addressed it, one of the things that we are excited about is it's taking an off the shelf product and using it at some new market opportunities and not with those specially in the ATV market or some of the other industries that we are talking about their it's not that it is necessary material for the business enough in themselves.

An example of additional opportunities for the company to operate outside of just strictly automotive and that applies not only to HomeLink but our goal is to help us those relationships will allows us to introduce other technologies that we make and have expertise and to be offer those to those new customers as well.

On the other side, the HomeLink in the international market we have talked about is coming along quite nicely with our compatibility agreements in the China market. We are excited about over the next three to five years what kind of growth opportunities that will have in the China market.

There is a lot of speculation at this point because we actually have to go and first get the compatibility in place and then get customer award so that to help drive that business but based upon our initial dialogues with the OEMs we are excited because they do see the value in that marketplace.

So I think between market and I hopefully we answer your question but that's what we are seeing in the HomeLink product..

Yes that’s great. Thanks.

And then just following up, just kind of broadly on these has been few questions on the [indiscernible] obviously very hot topic these days, as potentially if and as it falls more under the regulatory umbrella over time, how do you think about your opportunity there from a competitive standpoint meaning is this just basically rising type from the content perspective overtime or are there pricing pressures that came to like some of the RCD stuff you have talked about few years ago that you could be subject to over time, just any help with how we should be thinking about that would be great..

I liked your language on that, it is a rising tide just beginning but it's a rising tide on the content side and now there has been so much discussion in the marketplace. The most common thing that we hear was that there was a war and the war is over and it's already been won.

The actual application for most of the function driver system application is actually just starting and we are really pleased that it is. There are very-very powerful competitors in this, we are one of those. We have been building it from the bottom of application with our smart being product we are going to continue to be a mid range option package.

There are high end, high performing multifunction packages but we are seeing growth in this. Again our product are unique and that we did that acquisition, we talked about back in the 90s to have a capability design on our camera chips so that we have better control on what applications we apply to those two.

And so with our own camera chips, we design our own optics. We write on algorithms for these and now that we are in the fourth generation of product, those products have been developed together with customers and so we have been adapting it specifically. Customers have driven us, have requested others and have awarded to us.

Mid range application packages that have an increasing function for it is and so the good news is it is a rising tide of applications and there are competitive pricing pressures in it but right now relatively new as an application space, I mean it's basically a very low single digit application percentage where it's applied currently today that will begin to grow between now and 2020 as the first major applications begin to be applied and with it there are high end applications and our mid-range applications where mid range application in this working as always been..

Got it. That's great. Thank you..

Thanks Brad..

We will go next to Steven Dyer with Craig-Hallum..

Hi Steve..

Good morning guys. Couple of quick ones since most have been asked. As you look at growth for 2015, the midpoint of your revenue guidance is something like 9% or 10% growth over 2014 and in a flat production environment.

So as you take kind of that 9% or 10% and then you cut the price down, actually means kind of apples to apples, it's 12% to 13% faster than the industry.

Could you maybe take a shot at kind of bucketing out where that growth comes from and with the buckets maybe being kind of new programs, your takes rates going up or down and then content or overall ASP, however you think the best way is to sort of bucket how you are able to grow 10%, 12%, 13% faster than production?.

Sure. Well if you look at the press release then you look at what you have done for instance this year in terms of near constant growth that kind of establishes the base line. So in other words, that's the penetration of our new program that we are going to have in 2015.

Anything, the difference between that and the stated growth goals especially when you add back to 2.5% to 3% the difference there is content increases, it's a new feature that we are selling, it's the stuff that we don't report necessarily on our per part basis.

In other words, now it’s taken a mirror where we already have content and adding and other additional feature to it or changing that product to upgrade for instance products so with those are kind of how you bucket the growth rates.

If you are going to look at it, you would say roughly probably 50% of the growth is penetration and the other half is content increases..

Right. That's very helpful.

There is not a lot of talk about RCD anymore, can you kind of like I guess maybe talk a little bit about where you stand there at the momentum that you are getting or not getting and how you think about that piece of the business going forward?.

This is Mark. RCD is still product for us and it continues to sell and continues to be applied and primarily outside the United States. In the United States where we have and it's a law that begins to take effect. The application are pretty much already defined. We publicly stated that at this moment we have got no material guidance honestly.

There is no longer a headwind to the business the areas where we were affected occurred in 2013 and 2014 so we are very, very pleased to pass that and so that's kind of where it stands I guess right now. .

Yes I like Mark said, the biggest thing that we are actually excited about is the headwind stops in 2015 during 2013 and 2014 we saw draw back because of the net legislation but this is a stable product at this point growing up outside of North America so it's a longer shrinking inside new business..

It possibly came up family of products as it relates to video displays in what we are doing as a company I mean in terms of RCD it gave us the infrastructure, helped us pave the way for what for display mirror has to come and so really it gives us the lower grade introductory products and gives us the high end product that we can introduce to OEMs who want to move to a full scale type application..

And given the fact that the [indiscernible] about to take affect and it sounds like most OEMs have made their decision so far, what kind of opportunities road do you think the full display rear view mirror has?.

Totally different application. Completely different always was when we were developing at.

The display mirror was to address selling the design things in the car where you see less and less out a smaller and smaller back glass and so this is a camera mounted high on the vehicles where it's applied and it is an [indiscernible] mirror with the options which to display also the full size of the mirror.

I mean it is not the same application we need to at all which is looking down in a very specific area. This is to address a totally different issue. It's sold as an option for automakers.

It was designed and requested about specifically by automaker customers in the past few years and so they are not applications as we begin to go to market where we start initial shipments lately this year in the fourth quarter..

Great and then last question, could you give a little bit of guidance on the other income line of the P&L.

I know you have been winding down the investment portfolio, how should we maybe think about that number for 2015 and beyond?.

Yes I think if you look at we didn’t talk about but the unrealized gain offer has come down around $11 million after tax I mean we wouldn't expect that would be at the level of as it was in 2013 or 2014..

But that is going to be largely marketed..

So it means is that number half order it was in 2014 or without knowing the market of course but is $11 million kind of decent number to think about?.

Yes I think somewhere in that range depending on the market I mean it would have 10% to 15% improvement in the market from here to going higher than that. .

Okay. Great. Thanks guys..

Alright. Thank you..

We will take the next question from Jason Rogers with Great Lakes Review..

Just the follow up on the full display mirror, it would seem that unlike RCD that there would not be a lot of competition from the consoles since the display would be needed for entertainment features and other information is that the case?.

That's correct. It's totally independent of any other applications for video display like the automaker has. It's an additional option that automakers have requested and are increasingly requesting as a product..

Is it too early to talk about estimates for expecting unit shipments as a percent of the total?.

Too early at this point. We really don't really start production until very late this year..

[indiscernible] material impact by any stretch in 2015 it doesn't start until Q4 and volumes aren’t huge even in Q4. This is really one of our longer term growth place for the company..

Are you expecting any change in the degree of customer price reductions?.

No, if you look, we have – those haven’t come on line over the last several years and somewhere in the 2.5% to 3% range tend to be about where we expect this settle and maintain going forward..

And finalizing looking at you talked about Gentex being mid range versus high end for the functions, what's the main, if looking at the high and what are those some of those features that Gentex can't do or working towards?.

Actually always with the design intentionally. Since we start shipping a little over decade ago, to be a mid-range option application but it has an average application tech rates which is applied about 25%.

The high end applications for the driver were traditionally referred to as line of bunch of warranting [indiscernible] collision warning, pedestrian detection, collision mitigation, traffic sign recognition, the headwind monitoring, adopt a video, adopt a cruise control and things like that.

At the core where we have been asked to compete in this, we began originally as an automatic [indiscernible] control system where you are industry leader in that but from that point originally the subsequent generation of the product, after the generation four, there is beginning to shift now, we have been asked to detect objects generally and see information, to the vehicle to the various electronic control units in the vehicle as well as well conditions.

So at the core of driver system if you want to look at it, this way, they were very basic function that driver assistant is working to saw is “tell me when I am going to crash into something, anything.

A recon a pedestrian, a telephone phone, a leave the road and that kind of thing and so in those applications, since we had originally and always have been detecting light and the position of lights on the vehicle and sending instructions to our own lights to manage the [indiscernible] we have always increased some of that capability to detect position of objects in the applications.

Most of the customers have been asking as to do so [indiscernible] has continue to expand and grow as a product and there is now likely we would have said in this call increasing market interest for the high end systems and many of the features we don’t do at this point, the ones that we probably said are part of smart beam are the providing control, the length detection functions and the collision functions generally..

Okay I would like to squeeze in one more just wanted to get an update on the double aircraft window shipment..

So you said the level?.

A general business update if you are continuing to grow that area of the business..

Yes we absolutely the growth basically you see in that area is related to our expansion of that product on the both 787 family and as they have launched new aircraft and new derivatives of 787 we are part of that product growth. [Indiscernible] It continues to be good business.

It's a business where we are continuing to extend on the applications of 787 and we are actively new business but it's still small portion of the businesses..

Thanks a lot guys..

All right. Thank you..

We will go next to David Whiston with Morningstar..

Good morning.

In October you had said the plan on CapEx for 2016 I think was to have a go down versus 2015 is that still true?.

No. what we are talking about is normalizing the CapEx and we are talking about this specific portion of the CapEx related to the facilities expansion..

In other words, most of that spend would be in 2015 on the new facility. We haven’t given guidance on CapEx for 2016 yet..

Okay.

And two things on the product side, the going back to the discussion on your [indiscernible] part of an auction but down cars and autonomous vehicles do you think how much longer would it be for Gentex products to be standard is that less than a decade away and somewhat related could any updates or anything you want to share about the about your time [indiscernible].

On the standardization feature, we have really never been standard in corporate history and our customers tend to looked to us to create auctions that they can apply and automakers can also make money, it's one of the reasons for us to success.

And so for us predominantly going forward, we have operated the business as a growth business as an auction. We are still targeting for that to continue with no real change in that at this point..

On the [indiscernible] side it was a new step of the company we had in the display there before. One of the things that I will say is that it's a great opportunity for the company to meet and discuss new products and feature technologies of customers as well as investors and analysts. It's nice to talk on the conference call.

It's very difficult to describe the products [indiscernible] without being able to see them and touch them and so one of the things we are focused on 2015 is trying to be have the same footprint that we had in 2014 as it relates the same [indiscernible] where we openly invite the investors [indiscernible] buy and see the product that we are talking about just come by those shows as well as we are planning [indiscernible] planning a investor analysts day here [indiscernible] in the second half of the year.

That’s a great opportunity to actually see the products we are discussing on this calls and understand them in more effective way. .

Okay. Sounds great. Thanks so much. .

Thank you. .

We will take our next question from John Murphy with BofA Merrill Lynch..

Hey John.

Good morning guys. Just the first simple question.

With two thirds of Europe shipment, almost two third of the [indiscernible] shipment international, is there any impact from the strengthening dollar or most of your sales are dollar denominated?.

Most of our sales are dollar denominated. So the issue that we face based on currency aren’t really about our sales levels and FX issues, it's more about the economies and how the automotive sales are doing in those current [indiscernible] economies. .

[Indiscernible] it's an immaterial level in outside of US dollar sales, is that correct?.

Yeah that's correct..

Okay.

second question I mean on the inventory calling out adjustments, you are calling out in the fourth quarter, does that mean the third quarter benefit or there will be catch up in the first quarter because it sounds like it's more of time and seasonality thing as oppose to one time item and if that’s the kind of thing that we [indiscernible] first quarter or the second quarter of next year..

It is primarily correct. The timing and the seasonality issue, the deliveries generally are adjusted to another time. .

And that's the point is over the last several years I would say 80% of the years we go through this occurs and happens and so really when you look at the year-over-year basis, keep force slightly lower [indiscernible]from timing issues and Q1 tends to be little higher than it would be normally.

couple of years ago everybody was growing production at a rapid phase and working through holidays whereas now I think level and everyone took kind of traditional holidays. .

Good lesson for us if Christmas [indiscernible]in the middle of the week we would take a strong note to pay attention to that in the future. We can't have an impact on [indiscernible] and things like that..

Just as we think about the product and think about this full display mirrors that you have discussed, I mean it used to be that you have products or RCD products in the mirror that the image you had in mirror that would facilitate the needs of requirements and it sounds like what you are talking about now that that's not possible or not the way that the automakers are going and I am just curious I mean we have always thought about this mirror or the mirror as screen in the vehicle and potentially replacements for the screen and that's what you guys have talked about but it sounds like that’s changed dramatically in your communication to it.

I am just trying to understand what's changed there..

You know actually it's exactly the same communication that we have been having with the full display mirror.

The totally different application automakers came with us basically with an increasing challenge that you are seeing less and less out of the rear mirror out of the styling, the rear windows are changing in size, head rest are in the way, when you look in the mirror view, mirror view tend to see head rest, and now they are interfering things so this is an additional camera mount to the high end of the vehicle looking at the place where the rear view mirror is looking.

Where camera display application, which we do still have in the United States and worldwide is the camera is very specifically expect to look down on the specific area for backup. This is a switchable system created by automakers that addresses totally separate issue this point.

Can they merge in the future? The cameras are looking in different places. The camera display will be used for more than one year, [indiscernible] absolutely therefore for more than one video camera on the vehicle and an application. .

It seems logical I mean just connect two cameras to one display as oppose to paying for _ display.

Its just seems odd that you wouldn't do both can you talk about the economics operator display yours versus your regular self mirrors, are they the revenue and the margin and investment much greater than what you have just on the regular mirror right now?.

Yeah there are both there are revenue is a lot higher than the traditional mirror, the development specially in the first few programs is very high. But that development is being handled inside of our current R&D budget so it's not like that you would see R&D escalate in any way outside of what we have already guided to for the R&D.

One of the things that we would do talk about margins typically when we launch new products tend to be roughly in line what the company said average so that would be expectations from that business going forward. .

Okay and then just lastly, who makes the cameras that you guys use? There is a number of different suppliers, is it most [indiscernible] just trying to understand?.

They are Gentex cameras John, Gentex made an acquisition in the 1990s in California Silicon valley effectively for [indiscernible] images we have been designing our own CMOS images and our own cameras [indiscernible] history we just went for [indiscernible] fourth generation of it. We are not buying cameras. .

You are actually producing the physical camera or --.

We are producing the physical camera, _.

Okay. Great. Thank you..

Very good. Thank you John..

Next we will take the follow up from Rich Kwas from Wells Fargo Securities..

I will make it quick. [indiscernible] has that launched already or when will that launch in 2015 and.

Launch in Q3, remember when we announced third quarter [indiscernible] production in 2015 multiple vehicle..

Multiple vehicles and then I guess it's too early to give some detail on take rates for the incremental safety functionality or do you have any kind of early read on what you see?.

Since it comes on board, we should be able to in the future _ starting the application right now so it's early but..

Okay. Yeah that would be helpful to future calls to –.

Maybe we should point something out because there continues to be – there is so much public communications that drivers assist is a specific set of features that a supplier or [Indiscernible] if you look at smart beam for last few years, what you have seen are our generation three products [Indiscernible] shipping for some years have capabilities called motor way detection as an example that's linked actually and that's [Indiscernible] application are and increasing capabilities for things that we named [Indiscernible] tunnel detection, things like that.

This is an object detection capability that can detect distance to objects communicate them to the vehicle and that [Indiscernible] continued to expand and so one of the challenges I think we have to do [Indiscernible] better job of explaining is the specific list of features offered by some of the suppliers that not necessarily means that's the product.

There are many, many applications in this marketplace. We are trying to do that to better understand it..

Okay. Great. Thank you..

Thanks Rich. That's very good. I think that's it and we appreciate everyone for the question and participation in call today. Thank you very much..

This concludes today's conference. Thank you for your participation..