THE CARBON FIBER REVOLUTION – LEMOND COMPOSITES IS SPARKING SIGNIFICANT CHANGE
CARBON FIBER IS THE ULTIMATE ENGINEERING MATERIAL
Carbon Fiber is up to ten times stronger than steel at only one-fifth of steel’s density. Its thermally and electrically conductive, highly fatigue resistant, thermally stable and has a zero coefficient of thermal expansion. Carbon Fiber is what makes everything from fighter jets to Formula 1 cars lighter, stronger, faster and safer.
• It takes us to the moon and now Mars.
• It helps us win the race from world-class bicycles to Formula 1 cars.
• It extends the performance of traditional materials to make safer structures.
• It enables longer wind turbine blades that capture more energy
Historically, carbon fiber was developed for use in space and defense applications. Today it is produced in much the same way it has been for over 40 years which means that its cost and availability is limited to the relatively few applications and customers who can afford to pay for this unique performance. Materials industry experts have concluded that if carbon fiber could be produced at lower cost and at a more efficient scale, then the number of customers and markets that adopt it are destined to expand dramatically. Even now without any new innovation in production technology being introduced, the market for carbon fiber continues to grow at double digits as predicted by industry experts. A new era of growth in carbon fiber demand is emerging in several sectors from alternate energy to urban air mobility.
THE PROBLEM WITH TODAY’S CARBON FIBER SUPPLY CHAIN.
Every product that is made with carbon fiber is fast, light and strong, but the way carbon fiber is produced today is no different than it has been produced during the past several decades. The production process is slow, expensive, and requires a significant capital expenditure to scale production to meet the rising demand for the material. Worse yet, the traditional production process that is used to make carbon fiber emits an extremely high amount of CO2 and is very harmful to the environment. The manufacturing process required to make carbon fiber has always been very expensive, energy-intensive, and requires a significant capital expenditure to expand capacity. That’s why there are only a handful of carbon fiber manufactures globally. These select “few” manufacturers of carbon fiber have had a lock on the market for years with little or no outside competition. It is clearly evident that demand is growing for carbon fiber. However there has been modest growth in production capacity for carbon fiber. The key players in the carbon fiber industry have not made any significant investments to improve or expand their production quality and capacity. The intensive capital requirements to build new carbon fiber manufacturing facilities have prevented the incumbent carbon fiber manufacturers from expanding their capacity. Most carbon fiber manufacturers are content to keep their lines running at their current capacity to fulfill the basic needs of their long-term customers. Traditionally, the supply of carbon fiber oscillates and lags the uneven demand patterns of the aerospace industry. This has resulted in supply and demand curve that is marked by volatile periods of extreme shortages and oversupply. The capital-intensive nature of carbon fiber manufacturing makes any investment decision to expand a very difficult one to make for these suppliers. Only the manufacturers that possess long term government or aerospace supply contracts can make expansion investments with confidence. While the world is adopting carbon fiber as the “miracle material” of choice, there is little capacity to meet global demand for carbon fiber. An important example of the growth in demand for carbon fiber is the wind power industry. Wind power design engineers are specifying carbon fiber as the key material that will allow them to build the wind power infrastructure. The wind power segment alone is expected to grow by more than 22% CAGR and expand by 300% to 2028. While this demand in wind power is growing, the supply for carbon fiber is expected to fall far short of demand by a factor of two-times the existing global nameplate capacity. It is important to note that this dynamic closely parallels what is happening in the semi-conductor and microchip global shortage that we’ve all been reading and hearing about lately. In the microchip industry, there has been a long-held belief that the only way to make a significant investment to expand capacity is to first secure long-term sales agreements with key customers before a dollar is spent to ramp-up production capacity. Because of this belief several critical industries are now being held hostage to a critical chip shortage that is halting production lines world-wide. The carbon fiber ecosystem is not far behind in seeing this same dynamic stop production lines because of a shortage of carbon fiber material, which like microchips are considered to be a vital strategic material by the department of commerce.
GLOBAL WARMING AND REDUCING CARBON FOOTPRINT.
With the world focused on reducing greenhouse gasses, and all major industries facing the mandate to reduce their carbon footprint, the carbon fiber industry has turned a blind eye to these critical global trends. So, how does the carbon fiber manufacturing industry balance the need to expand the benefits of this miracle material to meet the demand needs for carbon fiber in the context of a new world order that is keen to be more efficient and more environmentally friendly? Until now, none of the major materials manufacturers have answered this question. Their landed capital costs and present operating model simply do not provide an incentive to do so. It’s a business model that cannot scale in response to the type of demand that experts are forecasting.
Innovation and change in the carbon fiber industry is required in order for this miracle material to fully meet the potential that has been predicted for the future. There has been no incentive for innovation amongst the incumbent suppliers of carbon fiber. It is their belief that the current paradigm is working for them, and that it makes sense to simply keep scaling the existing technology under the current business model. Their view is that as the market grows 10% to 15% per year, they have achieved a controllable growth rate that is easy to manage. The incumbents don’t want break-out growth in carbon fiber demand – that’s too disruptive. It’s safer and easier to control the industry and keep new entrants out. Until now, there was no real answer to this dilemma. LeMond Carbon has the solution that meets the requirements of this new era for carbon fiber materials. For more than a decade LeMond Carbon has painstakingly focused on creating innovating new solutions. We have created and proven that our unique solution for manufacturing carbon fiber allows us to…
• Build a carbon fiber production line that delivers a production output rate that is three and a half times greater for the same capital expenditure required to build a “traditional” carbon fiber line.
• Scale production expansion plans in a way that can increase production capacity in a way that is significantly faster and leaner to meet the growing global demand for carbon fiber.
• Operate a carbon fiber manufacturing facility that is more environmentally friendly with a carbon footprint that is three times less than current carbon fiber manufacturing techniques.
• Reduce processing costs by approximately 30% allowing us to product high quality carbon fiber while delivering greater profitability to the operation.
And, LeMond Carbon can do this in a way that is sustainable and highly scalable for future expansion that will allow us to capture the significant growth in wind power and hydrogen storage vessel usage as the world shifts to green energy sources. LeMond Carbon is considered a “start-up”, but we are not new at this game. Our investment partner, Deakin University has invested over $45 Million (USD) to create, refine and prove the technologies we use. We have spent an additional $22 Million (USD) to continue to refine our I.P., take the message to the commercial market, obtain third-party endorsements, and assemble a team of the leading carbon fiber innovators.
· Our process is proven. Through our pilot operation located in Australia, we have produced carbon fiber materials that have meet and exceeded the engineering specifications of the most demanding customers in aerospace, automotive, and power generation industries.
· Our technical performance specifications have been tested and verified by one of the world’s leading independent testing laboratories, Bureau Veritas.
· Our production and processing capabilities have also been tested and verified by Bureau Veritas.
Now is the time to build the carbon fiber manufacturing facility of the future. All of the pieces of the puzzle are in place. We are seeking partners to fund our plans to build a full production scale carbon fiber manufacturing operation in the United States, the United Kingdom, and Australia. Through a combination of equity raised through our Series-A funding and debt financing, we are confident that we can scale a profitable, efficient carbon fiber manufacturing operation that will be well equipped to capitalize on the explosive growth of wind-power, hydrogen vessel power demand for carbon fiber.
We know through our proven process that we can meet this demand in a way that is…
.. More profitable
…Possesses a significant cap-X advantage over current technologies
…Is “Greener”
…Is scalable for efficient growth in this massively growing segment
We have proven that our unique process works. And more importantly, we have been working with the top global purchasers of carbon fiber who have not only expressed interest in buying our product, but have also signed commercial letters of intent, and have provided technical endorsements that provide further evidence that our product and our process is THE answer for meeting the rising global demand for carbon fiber.
To do this LeMond is in the process of raising $105 Million (USD) per production site through a combination of Series A funding and structured debt. We are seeking partners in the investment banking community, institutional investors, and corporate partners to work with us to raise the required capital required to revolutionize this growth market and disrupt the paradigms of how carbon fiber has traditionally been made. We invite you to learn more about our history, our accomplishments, and our vision for the future. We have the data, the insights and the knowledge to make the dream of bringing the miracle material of carbon fiber to the industries that require it for our world to be a better place.
Contact Tim Cantwell at tcantwell@westbridgellc.com to learn more.