Adam Jonas - Morgan Stanley

Okay.

Bodo Uebber

I don't like it but this is, there is no real improvement in Russia. On the profit side we have no reversal of impairment of leased assets. That means, of course, what we have done where at this point of time I only would like to mention as you said we have to maybe increase it but I do think, let's say the market developments confirm what we have done last year in the third quarter 2008. So, we use this kind of let's say impairment, what we have, but as I said there's no reversal of impairment of leased assets so the profits are not impacted by kind of this stuff.

Of course the residual value, the development as such in the U.S. again positive in the third quarter, so we are far down from the peaks which we have seen four quarters ago and it seems to be that the expectation also for the fourth quarter is okay. In this regard U.K. also nothing, no bad news so it's developing okay. In Germany, we have some pressure on the residual side but also not as big but I have to speak from an earnings point of view as a warning or so.

From the dealer and supplier side, which you mentioned on the supplier side, there is an increasing number of suppliers which are in problem if might say so, different phases so to say. The impact which we had year-to-date is 60 million is not as big as we might have expected but the subject is such has a huge impact on our internal capacity. We have ongoing teams, of course, you can imagine which are coping with that subject. On the one end I cannot exclude that once in awhile we get a bigger issue here on this side and that, of course, the longer the crisis take and the longer we don't have top-line effects from the market point of view the situation with the suppliers without that I can tell you how big the number would be is increasingly an issue.

On the dealer side more or less the same we have not had real impact right now from the dealer side so I cannot tell you any number because there is no numbers so to say. But we had some impact in different markets within sort of in dealers which are not really a big issue I know we could work with that. But also they are more and more dealers, of course, the longer the market as such as they are and the trucks we are down by 50% more or less worldwide in the current market you can imagine that also Dealers are coping with that issue and that could lead to possible impacts which I cannot really forecast. It is not possible. Yes, that's the situation there.

Adam Jonas - Morgan Stanley

Okay. Thanks for elaborating on that. Thank you.

Michael Muhlbaye

Okay. Next question we take from Adam Hull WestLB.

Adam Hull - WestLB

Hi, good afternoon, it's Adam Hull from WestLB. Three questions if I may. First on the R&D, your amortizing 169 lower than you're capitalizing so it's about 0.9% benefit to the margin on Q3. I wonder if you could comment a little bit because it seems to be not so much that capitalizing is high but rather amortizing level is very low. You have got 6.5 billion on the intangible assets in the industrial business, and just maybe a little bit of a comment that we would continue to see that difference? Secondly, CapEx quite a low level in Q3 was down 34%, 3.2% of revenues, 3.3 for nine months, just give us a little bit of an indication to what degree you think is a sustainable level of CapEx for the group is and when you think you will start moving to that because obviously revenues are pretty low at the moment.

And then finally, on Mercedes I presume you still got some pretty attractive FX hedging rates and that's I presume still helping the fades particularly, I guess on sterling, perhaps you could quantify some of that and maybe give us some indication whether you're still taking FX hedging over the next year or two if you are still taking out fresh hedges on the dollar and sterling at these kind of rates? Thanks.

Bodo Uebber

So, Adam, your question to regarding R&D of course, there is some volatility quarter-by-quarter in these numbers and that depends more or less at what point in time you start with capitalizing products, new products, engines or whatever. So, all in all you cannot really, let's say there's no indication from a quarter development to about a year development. The only thing I can tell you that we have roughly between 30% and 35% capitalization ratios, as I said, depends sometimes on what kind of product we had and that is more or less the stable number through the quarters.

And in Trucks, we have a higher percentage in Q3 due to the start with the SFTP, the future truck for example, which gets you into capitalization so it's based on product development and nothing else.

Your second question regarding CapEx, of course CapEx development on the one hand there is one part which is also related to do products which we cannot really impact because we have this new product and then we have a new tooling and then we will of course expense it.

On the other hand in the crisis right now, we try also to be very aware what we spend what not. So, today, let say, what we are heading two years of course lower than 2008. It's might be higher in the fourth quarter on the one hand because we have postponed some spending on the one hand. And also for 2010, I don't see here right now you might take this with you not very further room for decreasing there's more room for so to say investing into the product side for 2010.

On the FX side of course we don't comment you on the numbers we have one quarter you see on the profit [work] but the effect is regarding the third quarter and you know the year-to-date numbers so to say, for 2010 we are hedged by 60% for the U.S. dollar for the British pound and we are more than 60% on the Japanese Yen. But, of course, the currency, of course, and something we not only look at when the dollar is $1.50 it's always a concern but the $1.50 level of course is a concern and will give us some thinking about how to offset this kind of stuff. It will impact certainly also the year 2010 and especially the pound of course has developed in a direction where we also have to take measures maybe on the pricing side in the U.K. and then Yen and it is something which we are watching very closely. Thank you.