“As we've noted, we'll underproduce in some regions, which will impact decrementals, as we dial down production faster than we realized savings from pulling levers.”

In context

“ain management is of utmost importance. Our team is working continuously to ensure not only that we're getting the best price on purchase components, but that we're also maintaining a robust sourcing pipeline to ensure the resiliency of our supply base. This year, we are seeing the impact of our strategic partnerships and supplier agreements come to fruition. Additionally, we continue to design cost reduction into our products. As noted previously, we expect the impact of these savings to drive year-over-year production cost favorability for our equipment operations, despite headwinds in other spend categories. Josh Jepsen: One more thing to add here. All of this work ultimately impacts our decremental margins, as we make decisions to proactively manage production and inventory levels. As we've noted, we'll underproduce in some regions, which will impact decrementals, as we dial down production faster than we realized savings from pulling levers. Additionally, we're negatively impacted by unfavorable mix from declines in high-margin products like combines and tractors, as well as geographies such as Brazil and North America. Importantly, we continue to robustly invest in future value unlock opportunities. Josh Rohleder: Awesome. And that's a great segue into my last question, which is for Aaron. Historically, we've maintained consistent R&D spend throughout the cycle, which in part, reflects our commitment to leading through innovation. The ag industry is going through a precision ag revolution, and Deere has been on this journey for nearly 25 years. Aaron, can you give us an update on where we're at in our Leap Ambitions and precision ag journey? Aaron Wetzel: Sure. Within our production and precision ag business, our Leap”