The transportation industry is faced with the challenge of meeting aggressive fuel economy targets that would reduce pollution emissions. Exhibit 1 highlights the worldwide efforts with the North American market targeting a 65% improvement by 2025. Automakers are pursuing various high profile avenues (such as engines, batteries and powertrains) that could enable their vehicle platforms to boost gas mileage.
Exhibit 1: Global Trend to Regulate Fuel Economy
However, one approach that has been broadly acknowledged, but receives less attention, is the use of ‘light weight’ materials in place of heavier metals such as steel.
Integral Technologies Positioned to Participate in a $300 Billion Annual Market
Integral Technologies (OTCQB: ITKG) is an emerging company that appears well-positioned to capitalize on the light weighting opportunity. Management estimates the market to be at $300 billion annually. The company is engaged in the commercialization of electronically conductive hybrid plastics. Its flagship ‘Electriplast’ product is a non-corrosive, electrically conductive, carbon fiber reinforced plastic (CFRP) material that can displace heavier metallic components that are currently used in electromagnetic interference shielding and conductive devices.
10% Weight Reduction Drives Up To 8% Fuel Economy Improvement
The deployment of Integral Technologies’ high performance material in place of heavier metallic parts within a vehicle body (as shown in Exhibit 2) should help automakers shed hundreds of pounds, making it easier to boost gas mileage and meet regulatory mandates. According to the Department of Energy, a 10% reduction in vehicle weight improves fuel economy by up to 8%. Electriplast can reduce component weight by 40-60%.
Exhibit 2: Multiple Opportunities for Electriplast within Vehicle Base
Most, if not all, automobile manufacturers are ‘watching the weight’ of their vehicles and consider light weighting integral to their energy efficiency efforts. Volkswagen is already using over 200 pounds of plastics across its ‘Golf’ platform, which is about 30% more than typically used in autos. Ford (NYSE:F) unveiled its Fusion lightweight concept car and revealed it was able to eliminate 800 pounds by incorporating more plastic material in place of metal parts. General Motors (NYSE: GM) has stated that the light-weighting of vehicles is a major focus and is using lightweight materials across multiple platforms. Tesla Motors (NASDAQ: TSLA) has incorporated carbon fiber in its vehicles.
However, the applications for Electriplast are numerous and extend beyond automotive into aerospace, consumer electronics and defense markets. With strong partners such as BASF, Delphi Automotive, Hanwha and others to help commercialize Electriplast, we expect demand for the CFRP material to accelerate in the near-term. In addition, we would not be surprised if additional partnerships were forged.
Positioned to be a Dominant Force because of its Unique Offering
The lack of a pure play competitor combined with 118 issued and pending patents and strong partners positions the company for future success. We believe operational execution is key for Integral Technologies as the market is for the taking.
We recommend investors look at public companies with dominant market positions participating (as potential comparables) in the transportation industry that exhibited strong share appreciation once their product offering was designed into a commercial platform. One such company is carbon fiber manufacturer Hexcel (HXL), whose shares experienced significant appreciation after it was announced that their ‘lightweight’ material was selected for usage in the Boeing Dreamliner 787. We believe ITKG shares could experience a similar trajectory.
Initiating Coverage of Integral Technologies
One Equity Research has retained an active, experienced industry executive, thought-leader and former materials analyst to advise our initiation of Integral Technologies, where we will explore how light-weighting will integrate into global supply chains and how investors can capitalize on this macro trend.
To receive a complimentary copy of our ITKG initiation report upon release, please subscribe here.
How to Learn More about Integral Technologies
Investors can learn more about the extraordinary opportunities addressable by the Company by viewing the Integral Technologies Corporate Presentation (below) or by visiting the Company’s investor relations website here.
About One Equity Research
One Equity Research is a leading provider of proprietary and in-depth research crafted by respected financial analysts and domain experts. Our team includes trained finance professionals with diverse backgrounds that include equity research, investment banking, and strategic consulting at preeminent firms. We distribute our research through mainstream media partners and to subscribers of our Intelligence Service.
Legal Disclaimer: The report described in this press release has been prepared by One Equity Research, LLC on behalf of a third party, as part of research coverage services. One Equity Research expects to be compensated up to twenty thousand dollars and may receive additional compensation for ongoing coverage of Integral Technologies. The research report is not an offer or solicitation to buy or sell the securities of Integral Technologies. The report is for information purposes only, and is not intended to (and is provided explicitly on the condition that it not) be used as the sole basis to make any investment decision. Investors should make their own determinations whether an investment in any particular security is consistent with their investment objectives, risk tolerance, and financial situation.
