Transcript
Good afternoon, ladies and gentlemen. Welcome to Research Frontiers' Investor Conference Call to Discuss the Fourth Quarter of 2022 and Year-End Results of Operations and Recent Developments. This conference is being recorded today. A replay of this conference call will be available starting later today in the Investors section of Research Frontiers' website at www.smartglass.com and will be available for replay for the next 90 days. Please note that some of the comments made today may contain forward-looking information. The words expect, anticipate, plans, forecasts, and similar expressions are intended to identify forward-looking statements. Statements that are not historical facts are forward-looking statements that are made pursuant to the Safe Harbor provisions that are part of the Securities Litigation Reform Act of 1995. These statements reflect the company's current beliefs and a number of important factors could cause actual results for future periods to differ materially from those expressed. Significant factors that could cause results to differ from those anticipated are described in our filings with the SEC. Research Frontiers undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were emailed to it prior to this conference call, either in their presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to email questions prior to this call or will do so afterward in order to answer more questions of general interest to shareholders on this call. We ask that you keep your question brief in the interest of time. I would now like to turn the conference over to Joe Harary, President and Chief Executive Officer of Research Frontiers.
Thank you, Paul, and hello, everyone, and welcome to our fourth quarter of 2022 and year-end investor conference call. I'm going to keep things more informal than usual today because I want to open up the floor to questions and discussion. We built off a number of very positive developments in 2022 and started 2023 off quite strongly. Gauzy had their largest booth ever at CES this past January and moved into the prestigious automotive west hall. Major worldwide customers such as Bosch, LG Display, OSG, Talgo, and Continental joined them with various products, mostly for automotive, aircraft, trains, and boats, but also showing architectural applications. And that was just the first day of the show. That night, the CEO of BMW had his opening keynote speech at CES, aided by Arnold Schwarzenegger in person and David Hasselhoff remotely, showcasing BMW's iVision. The car was equipped with its glass all around being SPD-SmartGlass. Also, highlighted prominently in Oliver Zipse's keynote and BMW's press releases was a heads-up display that added vast functionality and readability because of the SPD component. You can read more details in the press releases about this, but I was there at CES from the beginning and some of our shareholders have even visited. You could see SPD at the Gauzy booth as well as other places, and it was impressive and prevalent. Moving to another active licensee. AGP has visibly expanded its operations to now be headquartered in Belgium, close to many of its European customers. They have several SPD car models coming out this year. They also expanded in Flanders, and they have an amazing, highly automated smart glass factory in Ghent, Belgium. I visited it and it was really impressive. We also focused on positioning your company well for the past several years. I mentioned in one of the previous calls in response to questions about economic uncertainty how Research Frontiers has positioned itself to be somewhat recession-proof and certainly inflation-proof, and that continues, and I guess it's been well that we have done that. Because those things seem to now be happening in our economy. We are also patient. And because of that, we ultimately win over the customer. Many of you that have followed this smart glass industry might be aware that both Mercedes and Ferrari both used another smart glass technology before switching to SPD. And this year, we expect another OEM that originally selected another switchable tint technology to switch over to SPD. Usually, the OEM ultimately understands that not all smart glass technologies or the companies supplying them are created equal. And we foster this by education, continuous improvement, data, having a high-performing technology, focusing on being a profitable business and constant refinement of our business model, as well as good partnerships and cooperation with our licensees, and a drive to reduce costs and diversify the industries we're in. We and our licensees are constantly tapping into and fulfilling the need of customers to offer solutions to their customers and enable them to deliver new and improved and innovative products. And with that brief introduction and recap, I will now turn to some of the questions that we received by email. Tom had asked during the last conference call for more details about General Motors' growth in SPD, as you mentioned previously. Can you elaborate on this and share specifics that might be significant for investors? First, I want to highlight that General Motors has integrated SPD-SmartGlass into their flagship electric vehicle, the Celestiq. They have been consistently announcing their electric vehicle strategy, which focuses on launching several higher volume EV models starting this year. My confidence in their expansion into other applications comes from direct communication. I spoke at a conference about automotive glass, and the head of GM's glass and roof systems attended. He reached out to discuss several car models they were considering for SPD and sought my advice on how to proceed. They will be releasing multiple vehicles following the Celestiq, which is their flagship and a beautifully crafted, hand-built model. Another question Tom had asked, please talk more about Hyundai, the magic roof, as this was out on the Internet. I know you can't get too specific. And basically, I spent a lot of time on the last conference call speaking about Hyundai as a company and about the Grandeur, the GN7, and some other vehicles that they have. What I'd like to do now is just focus on what's in it for them, what's in it for Hyundai. First of all, to the extent they put this on internal combustion engine vehicles, they're going to save 4 grams per kilometer in CO2 emissions, which is very important, especially in Europe where there's penalties for not hitting CO2 targets. And in general, their fleet will have better gas mileage by using SPD-SmartGlass. If they put it in the electric vehicle area, you're going to get an estimated 5.5% increase in the driving range. And then, of course, you get the halo effect of having what's on Mercedes, McLaren, Cadillac, and Ferrari. So those are reasons that I think Hyundai is on a good path with that. Another question came from Chuck. I will try to just use first names here just to preserve some privacy. With the Dynamic Glass Act passed and other progress happening, when are we going to see a significant number of SPD windows in offices and other buildings? And I will ask you, Chuck, to hold that question because I will answer it in my closing remarks. But then the other question you had is about the Dynamic Glass Act itself. And certainly, that changes the dynamics for the better because it's offering a 30% to 50% tax credit for adoption of smart windows, such as SPD. So that makes the economic equation that much better for people adopting it. This is David. Many licensees hold patents for various uses of SPD. Do these patents pose a significant obstacle for other licensees in implementing SPD? We want to ensure that these patents do not prevent other licensees from utilizing improvements as they arise over time. Each of our license agreements includes a provision, typically found in Section 10.4, that ensures upon termination or expiration of the license, we retain rights to all intellectual property related to smart glass and SPD. Another question came from William, says, the CHIPS Act with the focus on Made in America brought about by the CHIPS Act. Are there any ramifications for Research Frontiers? Well, we have a number of US-based manufacturers. So to the extent that there's economic advantages for manufacturing in the US, our licensees all have operations here. And also, we have some licensees that are only in America. So that's them. That's good. Okay. This comes from Jeff. Several electric vehicle manufacturers are facing financial challenges, and some may not survive. This will restrict participation to major automotive companies, which are more difficult to enter as their planning occurs years in advance. How do you view the current market? And regarding View's financial difficulties, how does that impact you? Well, let me address both questions. One advantage of being in the licensing business is our ability to collaborate with all players in the electric vehicle sector without having to choose between them. Frankly, it’s uncertain which EV manufacturers will thrive. Years ago, there was skepticism about Tesla's ability to produce more than 10,000 or 20,000 cars annually, and they've significantly improved since then. We anticipate market shakeouts; history shows that many carmakers from the early 20th century did not survive. Therefore, casting a wide net is essential, and as a licensing company, we can do just that. Regarding your question about a shift toward established vehicle manufacturers, our core business has involved established car companies like Mercedes, McLaren, General Motors, and Ferrari. Our demonstrated reliability has gained respect within the existing automotive industry, benefiting us greatly. We have a long and prestigious track record. If the electric vehicle market gravitates toward established manufacturers, we will thrive. If it leans toward newcomers, we will benefit as well. Concerning View and their financial troubles, they are indeed struggling financially. We will likely have more information on March 29 during their year-end conference call, which is approaching quickly. Unfortunately, they have negatively impacted the entire architectural smart glass sector due to financial and accounting issues, along with pricing uncertainty resulting from heavy subsidies that led to a $260 million loss last year. They are making efforts to improve, and I can only wish all our competitors well, as they set reference points for improved technology and a viable business model. And another one comes from Judy. I recently came across this TechCrunch article claiming that the passengers display portion of the Celestiq megascreen will incorporate SPD privacy blinds to minimize driver distraction. Is this fact or fiction? Well, you can always read what reporters will say. But I will say this: some OEMs are working with SPD to minimize driver distraction. And for now, the only thing I'm sure of is that SPD-SmartGlass will be standard on this Celestiq roof. But we certainly have had broad discussions with GM about the benefits of SPD. So nothing here would surprise me on that. Okay. I think we answered most of those questions. From John Roberts, is Resonac, previously known as Showa Denko and Hitachi Chemical, an active licensee producing and selling SPD film? Also, with the passing of the IRA, has REFR architectural glass licensees experienced a material increase in inquiries and sales? Bob, thank you for the questions. Yes, the Inflation Reduction Act, as it was titled when it was introduced, the Dynamic Glass Act certainly changes the economics of buying smart glass or putting it into small and large office buildings and residential buildings and also homes. As far as your question about Hitachi Chemical, as we noted in our 10-K, Hitachi Chemical had sold their division that was doing the SPD film to Showa Denko and has now been rebranded as Resonac Corporation. And they continue to sell film into late 2022. But we think that because this division is part of something that just kind of moved from company to company to company, there's the possibility that they may reduce or wind down that business because of this. However, that shouldn't affect us because of Gauzy. This film is comparable in performance and in many cases better than the original film, and it's certainly less expensive, which expands the market. But thank you for that question, Bob. Okay. This is from Claire. I recently saw an ad for an electric BMW that had a sunroof that seemed to be using SPD technology, although the ad didn’t mention the technology. Do you know if this was SPD technology? Initially, they used something else, but OEMs have started to realize that other switchable glass technologies like PDLC or electrochromic have issues. As I mentioned, we are selling to a new OEM this year for this very reason. It’s great that they’re experimenting with different materials. Ultimately, when they ramp up for high-volume production, they will likely opt for SPD. I also want to extend my gratitude to Matt for his kind words about our dear friend Ron Rizzato, who was a long-time shareholder and broker, and an exceptional person. I spoke to Ron many times, and I wish his family well and hope he rests in peace. At this stage, we have addressed most of the questions we received via email. I’d like to have Paul open the floor for any live questions that we haven’t already covered, after which I will make some closing remarks.
Operator Instructions. Leonard Leetzow, Wealth Planning and Design.
A question, I think I was reading that Gauzy was going to be going public with an IPO probably in the first quarter. Number one is that true, and will it happen?
I read the same article you did, Len, and I believe Gauzy's ultimate goal is to go public. This move would have several advantages, including enhancing their visibility as a company and providing capital for expansion. Many large OEMs prefer to know who they are working with, and Gauzy has notable investors like Hyundai who would likely welcome a strong supplier. While I can't comment on the timing, it's clear that the IPO market has been slow for some time, though we are starting to see signs of improvement. I believe strong companies like Gauzy will perform exceptionally well when they do go public. I will limit my comments to this, as I probably have more insight into the situation than anyone outside of Gauzy and perhaps even some inside the company.
A second question then. I know that they have increased the amount of emulsion that they have been making that was announced almost a year ago.
Right. The 5x increase. Yes, the 5x increase in their capacity.
That has to be going someplace, so isn't that going to push us towards positive earnings per share relatively soon?
Yes. I'm delighted that they're making that investment that's going to benefit not only their investors but our investors as well. And I can't say enough nice things about Gauzy. They really are an amazing company that really is doing smart glass the right way. And that's what originally attracted us to them is that we both share the same vision as to where this market can go if it was done right.
And are you content with where it's going and the speed with which it's getting there?
I'm never satisfied with that. I was born prematurely, so for me, waiting is not something I value. However, I believe it's crucial for us and Gauzy to approach this correctly. It's important to avoid poor starts or missteps with new technology, and I think our strategy has proven effective. We've seen companies like View face significant issues when they haven't taken this approach, which can be detrimental to the company. Therefore, it's essential to do it right. Gauzy and Vision Systems are committed to doing it correctly; they are investing in the right processes and hiring the right people. If you examine their hiring trends, you'll gain a clear understanding of what they're doing and where they intend to go.
With the Glass Act having passed, I think the credits start hitting in January of '24. Is that still accurate or if they order now, do they get the benefit of the credits?
I think you have to put it in service by then, so you won't miss out if you do it in 2023.
But that would be very good for us.
Yes, very much so, very much so.
Okay. Thank you, Joe. Thanks Len.
Thank you. John Nelson, private investor.
Hi Joe.
Hi John. How are you doing today?
I’m great. Thank you very much. I've got a couple of questions, but the first one is kind of a broken record question as far as any updates on the visor, the windshield visor?
Right. So that actually has started to incorporate itself into some vehicles already in a built-in sun visor, and a lot of the test vehicles that we do, the concept vehicles that we do, have that kind of concept already built into it. And in McLaren's case, they actually put it into the windshield itself. As far as the fold-down sun visor, that's moving forward, but mostly targeting the aftermarket. Until that gets introduced, there's not much I could say about it other than it's being worked on by several licensees, and I think it's a good application.
Okay. Great. And then this next one, you may or may not be able to comment on, but it looks like we're set up at REFR for a significant jump in revenues in 2023. Is that a reasonable assessment?
I think if you look at this, I don't know if anyone noticed, but in prior conference calls, I used the F word without mentioning the name of the car company. For the first time in our 10-K and in our press release today, I mentioned Ferrari. I was really pleased that earlier this week, Ferrari started saying their cars are being delivered to customers. Actually, one of the Purosangue customers reached out to me indirectly to say how excited he was to get this smart glass on his car. It's between what we have with McLaren, Cadillac, Ferrari, and what is coming out in Asia. As I mentioned, it's not just one carmaker now; it's two over there that are unrelated to each other. Many people have assumed that Hyundai and Kia are joined at the hip, even though they are separate companies, but I'm referring to another company in a different part of Asia that also looks like it's coming out with an SPD product. So, yes, I think we're going to have a good year. The jump in revenues, since many of these cars don't come out until towards the end of the year, may happen in the third or fourth quarter.
Okay. Great.
But, yes, I think we're on a positive trajectory here.
Excellent, thanks very much.
Thanks, John.
Michael Kay, Kay Associates.
Hello, Joe. I've been a shareholder for over 20 years and a strong supporter of SPD and the company. However, I'm starting to feel disheartened because it appears that, despite your comments about reaching an optimal cost for SPD film and our partnership with Gauzy, the fee income continues to be disappointing. Considering that SPD is the leading light control technology available and that costs have decreased significantly, I find it difficult to understand why architectural firms and some automotive manufacturers are not more involved. Many of them seem focused on concept cars. What about incorporating SPD into more affordable models as you suggested could be possible in higher volumes?
Yes. Well, every carmaker I mentioned is not a concept car this year. These are actual serial production cars, and I think people that are following the industry will look at a mid-level car manufacturer like Hyundai as being the potential to vastly increase the volumes. Now if you're a farmer and you plant crops, you could stare at the ground for a long time, but each crop takes a certain amount of time to grow. And we've planted a lot of seeds, and this year, three or four of them have already started to grow, and one or two unexpected ones also came in that I think you'll hear about, so all good stuff. But I think you'll hear in my comment, my closing comments, some things that you might find also useful with respect to all of the markets, but also architectural.
Don't most companies prefer to have multiple sources of film? You mentioned that Hitachi would primarily source the film from Gauzy, which is acceptable. However, you previously indicated that you were in search of a US-based company to manufacture the film. Is that still the case?
I never said US-based. What I said in the past is that you're looking for a second source, and it's probably going to be co-located near their major customers. So that may be in Asia, may be in South Korea, may be in Europe, may be in the United States, depending on where the volumes are. But the licensees make those kinds of decisions about where to put their production facilities. And I think that part of this also is that if you have competition among the glass laminators, which we do, we have pretty much the who's who of the glass industry, then you'll satisfy the diversity requirement that a lot of people in the automotive industry feel comfortable with.
What about Panasonic? Is there any progress regarding displays and their use of SPD?
Yes, I think when you look at Panasonic, you should really look at who's supplying Panasonic, and that's LG Display. And we've spoken about that. They've had a very strong presence with SPD and their transparent OLED which is a remarkable technology. I mean, if you see this in action, it's mind-boggling how good it is. And it certainly is an attention getter. And typically, LG makes the displays for Panasonic and a number of other display manufacturers as well. So being there is very helpful for us.
The market for planes and trains seems to be improving, but there hasn't been.
All going well. Everything is progressing very positively. For instance, at CES, Talgo, the Spanish train operator, showcased SPD technology. We're involved with Deutsche Bahn and several other projects, including Japanese trains. Essentially, SPD is being adopted globally for trains and various other transit systems. Having Vision Systems as a licensee in this field has been incredibly beneficial because they have been dedicated from the start to trains, transit, buses, and their related businesses. Whether it's safety technology or electronics, they consistently aim to provide high-quality solutions for these industries. It's truly advantageous to have someone with such expertise in trains and mass transit vehicles involved.
Okay. I hope that we wouldn't have to wait another 20 years before the stock performs in a way that correlates with people's confidence in the technology and your management.
Thank you. It could be worse; you could be involved with either View or Crown and have lost 95% of your value in the last year. However, we are maintaining our position in a challenging market and we appear to be the leading player in our industry now. Regardless of competition, we will continue to operate in a responsible manner.
Okay, thank you, Joe.
Operator Instructions. Jarrod Sherman, Strategic Planning Group.
Hey, Joe. Thanks for taking my call. My question is regarding the revenues. I was hoping you could help me understand what it will look like going forward. If we're currently seeing sales from planes, trains, yachts, and a few high-end cars that yield $130,000 in revenue, how does that change if we have a client that moves 50,000 or even 100,000 cars a year? What would that mean for our revenue?
Okay, great. So first of all, let me just kind of back into the question a little bit. So revenue this year when you exclude one-time and special events and things like that was roughly the same as the prior year. All of the cars that are coming out haven't been reflected yet in our revenue for 2023 yet because they're all coming out in 2023. They weren't in serial production in 2022. If we took the original kind of estimates that we had when Mercedes was doing this, we were getting between $150 and $225 per car in revenue and royalties for that. Since then, fortunately, the price of the technology has come down quite a bit. And I'm thinking that probably a good estimate to use for your back-of-the-envelope calculations would be anywhere from $75 to $150 per car now in terms of royalty per car. So if you multiply that by someone putting in 50,000 cars, you'll see that that can make us profitable, clearly very profitable.
Now, isn't the size of glass, I mean, the original ones, we're just looking at a standard sunroof. Now if the entire roof is glass, that doesn't improve the numbers for us?
It could in that you're dealing with a larger piece of glass. But on the other hand, a lot of the cost that goes into any kind of glass product whether it's switchable or not is the fabrication, so the interlayers and things that go into it. So if you're spending labor dollars to lay up a laminate piece of film whether it's smart or not, that's going to cost you money. And it won't be as much on a larger piece of glass as a smaller one, but there'll be some difference. But, yes, it's certainly a benefit that sunroofs are becoming bigger and bigger. So you get the panoramic roofs or the ones that go from the windshields all the way to the back of the car like you see on the Model Y and some other vehicles. And what's good about those panoramic sunroofs that are basically all glass roofs is that the carmakers have realized sometimes after the car goes into production, which is another opportunity for us, that you can't shade something that big with the traditional mechanical shade that pulls across like you see on a typical sunroof. So they're beginning to realize that they need a switchable. And the switchable also has the added advantage in that you're actually reducing weight. So even with a normal Bentley that did these calculations years ago, a typical roof, if it went from a moving roof to a stationary roof that had SPD-SmartGlass, and that's the example they used at their presentation, it would save about 56 components and about 13 pounds of weight in the roof. And saving the components is actually a significant cost saving because it's really the cost of assembly that's the cost of a car, not necessarily the cost of the components. So we are not only more reliable because there's no moving parts in an SPD sunroof, but we should also help save money for the carmaker. And then, of course, you get the other benefits: increased headroom, reducing the cabin temperature by 18 degrees Fahrenheit, and other things like that.
You don't believe that the slow adoption is related to it being too expensive compared to savings in other areas. It seems to be a good product that has taken a long time to gain traction, and it's surprising that Tesla hasn't utilized it. It appears to be limited to high-end vehicles, which might deter potential customers, especially with prices in the $50,000 to $60,000 range.
If you look back at the transcript of this conference call, you'll see that I said earlier on that eventually everybody adopts SPD. It's just a matter of us having the determination to make sure. And I wouldn't be surprised if Tesla was one of those OEMs that also did that.
Thank you. I appreciate it Joe.
Thanks, Jarrod.
Art Brady, private investor.
Hi, Joe. Art Brady here.
Hi, Art.
Can you comment on the AGP factory that was established? Was this built to the same specifications as the Dusseldorf factory created by Gauzy, or is it configured differently?
It's a different type of factory, but it's a good question. They do share one thing: both are highly automated factories, resulting in very low labor costs. The Ghent factory in Belgium, owned by AGP, is highly automated. I visited this impressive facility and noticed that there were just three engineers monitoring screens to ensure everything was functioning properly. This setup indicates that labor costs can be nearly comparable to those in China since there's minimal labor involved. Additionally, the consistency and reliability of an automated system provide a substantial return on investment, especially for producing high-quality glass. If you check out the videos on AGP's website, you'll see some remarkable advancements they've achieved with our technology in their glass. On the other hand, the Gauzy factory produces film using a completely different method. It operates with a roll-to-roll system, coating an emulsion on a moving web of ITO-coated PET and curing it with UV light. This process differs from AGP's approach, which involves taking the film from Gauzy, sandwiching it between two glass sheets, and using hot melt adhesives like EVA, PVB, or polyurethane to laminate them into a single piece of glass.
About two years ago, you were in contact with some of the Gauzy people, and I'm wondering what the status is if there's any movement there, and when we might expect to see some revenue from that experience that you had in the Middle East?
I think you're going to see revenue from them from all over the world. They have a very strong presence in the Middle East. They have a very strong presence in Asia, all parts of Asia actually. They have a strong presence in North America, and they're expanding all of these. I mean, I'm privy to what their plans are. And I don't think they're doing this because they like the climate. I think they're doing it because they like the customers where they are. So, yes, we all expect a very good payback from this investment that they're making all over the world.
When do you think we could actually start seeing some revenue in that regard?
Well, if you look at their factory in Stuttgart, it has the capacity to produce 1 million square meters of film. They can replicate that production in other locations if needed. Additionally, they have quintupled their emulsion output. These are probably the best indicators of where I believe their business is headed. If they do decide to go public, it's not based on a standard PDLC product; they are focusing on an SPD product, which aligns with Gauzy's growth strategy as well.
Joe, I wanted to ask you about these train accidents. Does Gauzy or any of your groups have any types of products that they could sell to enhance the safety of trains instead of them falling off the tracks as they've been occurring frequently?
Well, both Gauzy and Vision Systems have very sophisticated sensor systems, and I wouldn't be surprised if some of those things could be deployed. But if you think about the tragedy that happened in East Palestine, it was ball bearings that heated up. It's not anything to do with heat coming into the cabin or anything like that. But they do have electronic sensors that might have been helpful. But if you look at the tracks in the United States, they were a mess. So I think you have to fix the roads that these trains go on before you fix the trains.
Yes, I understand. Have you heard of a company called SolarWindow Tech? Are you familiar with them?
Not very familiar. There's a lot of companies out there that are trying to do things in energy efficiency and generating power through transparent photovoltaics. We like them. They're complementary technologies because if you look at what, for example, Vision Systems did years ago, they were partnering with a French company that had a transparent photovoltaic material that they were able to make a self-contained aircraft window where you would just pop it into the side of the window. You didn't have to wire anything, and it would generate 20 times more power than it needed to operate the smart windows. You could charge your cell phone or other devices using solar energy. But there's a lot of companies like that are trying. Some are homegrown in the United States that we've spoken to, and they have promising technologies. And we keep track of them because we don't need a lot of power to run a smart window, so any of these photovoltaics, especially the transparent ones that don't typically generate a lot of energy still can generate enough energy to power a smart window. And then the real benefit there is you could pop this into a building or a home or a vehicle without having to wire it up. And that eliminates the need for electricians to be on site, et cetera. Thanks a lot, Art, good talking to you.
Michael Forster, private investor.
Joe, thanks for answering all the other questions. And since I'm last in line, I think I've got enough information now.
Okay, great. Thanks, Michael. I think we have one more in the queue at this time.
Tom D'Javo, private investor.
Yes. Hi, Joe. First of all, I'd like to thank you for your efforts. I think you are really working hard towards the right things. It's tough. It's a new product. It's got to get into the market. But anyway, the EV9 and the Grandeur, as you know, were mentioned with the magic roof. It has not been mentioned lately, but it sounds like Hyundai Kia is a possibility. The EV9 has been noted that it's going to come up with some info on the 15 and perhaps more by the 30. I know you mentioned Kia SUV stuff. Without getting too specific, If it's coming out soon, some info on it. Do you see this as a car that looks like it could very well likely have SPD?
I think that it's a prime candidate for SPD, but I don't think it's going to be first, and I'll tell you why. I think that if I was Hyundai, I would probably reserve to myself first the good stuff before I gave it to my sister company, Kia. But you never know what the internal politics are between them, but they're basically joined at the hip. I think that the work that Hyundai is doing with SPD, and they're a direct investor in Gauzy, which I think is important to know, I think will benefit Kia as well.
So something as soon as this month, you wouldn't be well aware of by this point?
I don't think it's going to come out this month.
Yes, no problem. Thanks for the answer. Regarding the Grandeur, you know...
That doesn't mean, by the way, Tom, that it won't come out on EV9. It just may not be a full launch; it might be more like a mid-model introduction or something similar.
Got you, got you. Are you able to say if BOS was working on the Grandeur sunroof in a roundabout way because they were working with Gauzy or not necessarily.
You're talking about a different company that we're very familiar with that is working on that project.
All right, thank you Joe.
Thank you, Tom.
I think we have one more on the queue I see. Yes, sir. Tom McCarthy, Raymond James Financial.
Hi, Joe. My question has already been answered, so I'll pass it on.
Okay. Thanks, Tom. Good talking anyway.
Jeff Harvey, private investor.
I joined late, but my question is related to GM, Ford, and Stellantis? I mean, I know it takes a long time to get in their queue for their electric vehicles. I was just wondering if you can give us an update and progress with those big companies?
Sure, and I actually read your question earlier and answered it. But I will say this that, in a nutshell, because of the track record we have with Mercedes and McLaren, being in the other established automakers is actually a positive thing because they respect reliability more than anything else. And that's certainly what we've had in our DNA since 2010 with the other auto.
What about cost, though? I mean, is cost a factor for these mid-range, inexpensive cars? Does that what's holding up – cost now?
No, I wouldn't say that now because the expectation is that Hyundai will have this, and those are not very expensive cars. So I don't think cost is going to be the issue now. The benefits become cost-effective when you can eliminate 56 components and reduce the weight in the roof to increase stability and headroom. There are many factors that contribute to cost, but the basic cost of the smart glass is much lower now with the Gauzy film compared to the Hitachi film. This has enabled a lot of progress. I just wanted to add that based on the time I spent answering your earlier question.
Okay.
Once you hear the replay, if you still have any questions, feel free to call me on my cellphone. I'm happy to go through those.
Yes, sir. Okay. Thank you.
You're always. You're a long-term friend, so I appreciate it.
We have no further questions in queue. I'll turn the call back over to our host.
Okay. Thank you. So I'm just going to make a few closing remarks. Every day, we all probably wake up, and we ask the same question, why would you invest in Research Frontiers? And if you want to invest in the smart glass industry in a proven technology that's used across diversified industries, then we think the best place and actually the only place to get all of those benefits is Research Frontiers. If you think of Research Frontiers as a materials company that has worked to develop an extensive patent portfolio with hundreds of patents on a basic material, it's as if we have a patent on stainless steel or titanium. Smart people out there then figure out how to use our materials as a solution to everyday problems, basic human needs: heat control, light control, glare control, safety, security, privacy, comfort, enhancing product performance. These are the things that our technology has allowed these companies to do. And we invite you to check the box of things that we've thought about and taken care of already. We have a strong and growing product pipeline, mostly automotive, but also trains, planes, boats, consumer electronics, and architectural. Expanding on the fact that we've become known in the industry as the best performing technology in this area and the most reliable. Our competitors have lost 95% or more of their market value, another reason to think about where you want to deploy your investment if you're investing in smart glass. So I think they're also helping us become known as the most financially viable player in the smart glass industry as well. And we also have the who's who of the glass automotive, yachting, and aircraft industries involved with us as customers. So it's not just our competitors that make us look good, we worked hard over the years to build and maintain credibility and establish ourselves as the industry leader. And as I mentioned, we did this by paying attention to a lot of things. And we've done this through financial stability. We have cash for at least the next five years and no debt. This gives us plenty of the necessary resources, but we're smart enough to know that we want to spend these resources efficiently. We have diversification of industries, a proven reliability for 12 years in the automotive industry. And in our industry, that is quite a long time and very compelling data that everybody respects. Research Frontiers is well-positioned for a recessionary and inflationary environment. And we talked about that, I think, two conference calls ago. I was drawing upon my background as an economist at the Federal Reserve Bank in New York. Having gone through both recession and high inflation when I was there, you saw what happens in the world and what you can do to navigate through that. I think that has been helpful for our company to have that perspective. We also have a healthy mix of business in government and commercial customers, and experience and respect and credibility and longevity as a company, which I think is good as far as how suppliers view us or as customers view us rather. We have good partnerships at a good business model with high rewards, predictable expenses, and low CapEx requirements. And we're expanding our use into new applications like TVs, headlights, adaptive grills, heads up displays. You've seen all of these happen very tangibly in the past year by some very well-respected companies. This year, I think you'll see more of this but in different areas that can also address very large markets like architectural glass. Look forward later this year to talk about exciting developments in areas such as impact-resistant, hurricane-resistant windows for the architectural market. Even the ability to retrofit existing buildings with SPD-SmartGlass. So that installation is quick with minimal disruption to building owners and tenants and at lower costs. So with that, I want to thank everybody for participating in today's call, and I look forward to sharing more good news this year with all of you.
This concludes today's conference call. Thank you for attending and have a pleasant day.