capacity expansion initiatives take longer or cost more than we anticipate or fail to deliver the operational efficiencies or throughput improvements we expect, we may be unable to meet forecasted sales, incur higher operating or capital costs or experience reduced margins. Any such delays or inefficiencies could adversely affect our results of operations, cash flows or competitive position. Fluctuations in prices of raw materials and other inputs may adversely impact our results. We purchase, directly and indirectly through component purchases, significant amounts of steel, aluminum, copper and other commodities. Steel, aluminum, copper and other commodity prices have historically been highly volatile. Costs for these items may increase in the future due to a variety of factors, including: outbreaks of conflict in regions of the world that produce the commodities or the raw materials that go into the commodities or through which the commodities are transported; or a weakening U.S. dollar. In addition, the cost of parts, materials, components or final assemblies has increased and may continue to increase for reasons other than changes in commodity prices. Factors such as the imposition of duties and tariffs and other trade barriers, supply and demand, the level of imports, freight costs, availability of transportation, the cost or availability of manufacturing labor, inventory levels and general economic conditions may affect the prices we pay for parts, materials, components or final assembly purchases. While the Company seeks to mitigate increases in the price of materials and other inputs through cost reduction initiatives, there can be no assurance that these efforts will be successful or sufficient to offset such cost increases. Increases in parts, materials, components or final assemblies costs could reduce the profitability of orders in backlog as those sales prices have already been negotiated. If we are not able to recover cost increases through price increases to our customers, then such increases would have an adverse effect on our financial condition, profitability and/or cash flows. Furthermore, price increases may not be accepted by our customers and may result in them choosing to order from our competitors. Any significant decrease in orders could have an adverse effect on our net sales, financial condition, profitability and/or cash flows. Additionally, if costs decrease and we are unable to negotiate timely component cost decreases commensurate with any decrease in costs, then our higher component costs could put us at a disadvantage compared to our competition which could have a material adverse effect on our net sales, financial condition, profitability and/or cash flows. We are dependent upon third-party suppliers, making us vulnerable to supply shortages and price increases. We have experienced, and in the future are likely to experience, significant disruption of the supply of some of our parts, materials, components and final assemblies that we obtain from suppliers or subcontractors. Delays in obtaining parts, materials, components and final assemblies may result from a number of factors affecting our suppliers including shipping disruptions, capacity constraints, labor constraints, supplier product quality issues, decisions by suppliers to discontinue or modify components or parts, including to meet changing regulatory requirements, suppliers’ impaired financial condition, interruptions in suppliers' information technology systems and suppliers’ allocations to other purchasers. Such disruptions have resulted and could further result in higher manufacturing costs caused by an inefficient parts flow to our production lines or the need to procure parts from higher cost suppliers, could delay production and/or sales and could result in a material adverse effect on our results of operations, financial condition, and/or cash flows. We are dependent on our suppliers of engines, chassis, axles, batteries and other components to continue to timely deliver such components that meet applicable emissions regulations and customer preferences. If we fail to have adequate relationships with suppliers that will supply appropriate engines, chassis, axles, batteries and other components to us or fail to timely receive appropriate components from our suppliers, that could result in us being placed in an uncompetitive position or without finished product when needed. Labor issues may adversely impact our results. Our production, or the production of our suppliers, could be disrupted by labor issues including availability of skilled workforce in locations in which we and our suppliers operate due to competition, absenteeism, public health issues, strikes or other factors. In addition, our production schedules assume the availability of a sufficient workforce in areas in which our facilities operate at anticipated labor rates. If a sufficient workforce is not available or rates are higher than we anticipate, it could have an adverse effect on our net sales, financial condition, profitability and/or cash flows.
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