How Big of a Business Can a Piece of Glass Make?

On November 20th, Cao Dewang’s charity organization, the He Ren Foundation, announced a strategic cooperation agreement with the Fuzhou Municipal Government to invest billions in the construction of the Fuyao University of Science and Technology. Fuyao Glass opened today with a skyrocketing stock price, surpassing a market value of 126 billion.

If Fuyao Glass, as an industry leader, with its decades-old industry status, does not have universal significance, then the attention brought to Guangyi Technology, an innovative technology company focusing on electrochromic glass products, may demonstrate the enormous potential a piece of glass can have.

Recently, Guangyi Technology announced the completion of hundreds of millions of dollars in Series C financing. The lead investor was the global veteran investment firm Huapin Investment, with additional investment from Dinghe, Gao Da, and other public venture capital investment institutions. It hasn’t been a year since they completed the Series B financing, led by the Chinese investment institution ZhenFund, demonstrating its rapid technological development.

What’s worth noting is that the strategic investors mentioned in their announcement include BYD and NIO Capital. The traditional giants and new head players in the new energy vehicle sector have also become investors in Guangyi Technology. “The outsider sees the excitement, and the insider sees the doorway.” The support from the industrial chain validates the heat of this company.

What is the charm of Guangyi Technology that attracts well-known investment institutions to extend their olive branches?

A Low-key Enterprise

In “Shuowen”, the interpretation of the character “Yi” means “feather-shaped wind”, also known as an ancient feudal lord or a shooter, opener comprises the sound. The general public rarely use this character, but most also recognize it. This is because of the well-known ancient Chinese myth “Hou Yi Shooting the Sun”.

Hou Yi used his own strength to create a livable level of heat for the world.

Although Guangyi Technology has completed hundreds of millions of dollars in financing, the outside world does not know much about this company. Whether it’s a coincidence that they combined “guang” (light) and “yi” (feather) as the name of their company is unknown, but these two characters are indeed the core technology and external expression of their mission and vision.

The core technology of Guangyi Technology is the third-generation electrochromic technology.

What is electrochromic technology? In short, it is stable and reversible color change of materials’ reflective, transmissive, absorbent and other optical properties under the action of an external electric field, thereby actively and dynamically controlling light and solar radiation heat. Electrochromic technology has a wide range of applications in the fields of construction, automotive, and consumer electronics.

In fact, Guangyi Technology is not the creator of this technology, but because of its exploration and research and development of third-generation electrochromic technology, it has become a leader in this field.

And the technological innovation of Guangyi Technology in the application of automotive glass is having a crucial and far-reaching impact on this hotly contested track.

Ambitious Goal: To Break Through the Celestial Canopy CrisisIn April 2009, the Tesla Model S made its debut on “The Late Show with David Letterman,” instantly reshaping people’s perceptions of cars with its revolutionary, high-tech design. Whether it was the enormous 17-inch display screen or the massive panoramic roof, the Model S was nothing short of amazing.

Unlike the design of most traditional car companies, which feature a front windshield, followed by a roof (or sunroof), and then a rear windshield, Tesla introduced a large panoramic glass roof, replacing the traditional roof. For example, the Model S has a front windshield, two sunroofs, and a rear windshield, creating an almost “all-glass roof.”

Just as the birth of the iPhone set a new standard for the design of smart phones, Tesla’s disruptive arrival appeared to have set a similar standard for the look of smart cars. As a result, the all-glass roof has become a key trend that many car companies, such as NIO, XPeng, and Voyah, have since followed and mimicked.

At the same time, driven by the trend toward intelligentization, cars are transitioning from relatively closed and isolated transportation vehicles into smart, open nodes in a data network. This shift in image also requires a more open body design that matches it, and the transparent, smooth, and hard characteristics of glass materials align well with this trend.

Of course, along with the trend comes the problem of the small sunroof being amplified, and the pain points becoming more prominent, especially when it comes to the balance between vision and heat insulation offered by ordinary sunroofs.

The “panoramic roof” problem with Tesla Model 3 is also very obvious, with an insulation rate of only about 70%. One car owner bluntly described Tesla’s sunroof as a “disappointing design,” “great to look at, but torturous to use,” and “even with the air conditioning at the lowest setting in the summer, it’s still very hot above the neck after half an hour.”

It’s become increasingly clear that solving the problem of sunroof vision and heat insulation is important.

Currently, there are three related dimming glass solutions on the market: PDLC (polymer dispersed liquid crystal), EC (electrochromic), and SPD (suspended particle). Among these three solutions, PDLC technology emerged the earliest and is the most mature, with the vast majority of dimming glass manufacturers using this technology.

For example, PDLC technology involves installing a layer of liquid crystal dimming film (PDLC) between two pieces of glass. When powered, the high polymer liquid crystal material in the film aligns in an orderly manner under the action of an electric field, allowing light to easily penetrate through the glass and become transparent. Conversely, when the power is turned off, the high polymer liquid crystal material becomes disrupted and cannot sort itself into an orderly fashion, resulting in a translucent rather than transparent appearance. However, this technology has many obvious drawbacks, with poor insulation and UV resistance performance.The EC (electrochromic) technology adopted by Guangyi Technology has become the key to solving the problem of skylights.

Electrochromic materials have been active in the academic community for nearly half a century. However, the development and application of electrochromic dimming glass have been slow, and now the technology of electrochromic glass has gone through three generations of development:

What was used in the Boeing 787 airplane windows and the Ferrari Superamerica convertible sports car was only the early first-generation Puroloro technology, which had issues such as easy leakage, poor reliability, and high power consumption;

The second generation is inorganic non-metallic material technology, such as tungsten trioxide, but there are disadvantages such as slow color change speed and high cost;

Represented by Guangyi Technology, the third generation of thin film electrochromic technology adopts flexible solid-state electrochromic material.

In terms of color change mode, it is a gradual change, which is the working mechanism commonly used in anti-glare rearview mirrors. It can adjust the light input according to the intensity of the light. In terms of heat insulation, Guangyi Technology’s third-generation electrochromic technology combines LOW-E technology to solve the problem of external infrared heat radiation and the problem of strong external light radiation heat, which ultimately achieves adjustable light and heat entering the cockpit.

At the same time, this technology also has leading advantages such as low haze values, ultra-wide color change range, low energy consumption, low working voltage, and high weather resistance, making it more safe and reliable in automotive products.

The performance of Guangyi Technology’s third-generation electrochromic technology on mass-produced models also confirms the advantages of its photo-thermal solution.

Taking the EC photo-sensitive skylight of the first model of ZEEKR car of Zeekr Group as an example, data shows that the ultraviolet blocking rate of the EC photo-sensitive skylight is as high as 99.9%, and the SPF sunscreen coefficient can reach 50. The long-wave black spot effect UVA (wavelength 320~420nm) transmittance is less than 6%, and the protection effect can reach the PA++++ level. At the same time, the EC photo-sensitive skylight also has the characteristics of low heat radiation (TTS<20%) and low transparency, blocking infrared rays, and having both shading and privacy.

In addition, the working voltage of the EC photo-sensitive skylight used in the ZEEKR 001 is only ≤1.5V, compared to other materials that typically require tens to hundreds of volts.

Through the combination of independently developed materials and processes, the stability, reliability, and single-function problems of traditional electrochromic technology have been overcome one by one, and the gap between “good-looking” and “useful” is being bridged by the founding team of Guangyi Technology.

A hundred billion-dollar business, taking the lead in the intelligent dimming new track.The active and efficient control of light and heat on a technical level is just the first step. In order to achieve practical application, it is necessary to overcome the obstacles of scale production.

As a long-ignored niche market, the proportion of automotive glass on the vehicle body has been growing slowly, with a growth rate of about 10% to 20% every ten years, and the unit value has been basically maintained at a steady level of 600 to 900 yuan per vehicle.

However, with a series of changes in the market, the proportion of automotive glass on the vehicle body is increasing, and the value-added it generates is also increasing. Dimming is one of the functions that will bring the most value per unit area of automotive glass in the future.

The area of a typical small sunroof glass is about 0.2 square meters, while the area of a panoramic sunroof is between 0.5 and 0.9 square meters. The area of a panoramic roof is basically between 1.3 and 1.4 square meters, which is about 0.5 to 1 times the increase in the unit area of a panoramic sunroof. In addition, the price per square meter of a panoramic roof glass is about 30% to 40% higher than that of a traditional sunroof glass.

According to relevant calculations, the overall penetration rate of car roofs in the first half of 2021 is 4.1%, with an extremely high penetration rate of 20.5% for electric vehicles, up 7.5% year-on-year. More importantly, the roof penetration rate of new models in the first quarter reached 35.2%, an increase of 15.4% year-on-year. Correspondingly, the prices of supporting models are also sinking, and the penetration is accelerating from high-end to low-end models.

In the narrow market of domestic panoramic roofs alone, the market space for 2025 is estimated to reach 12 billion yuan, with an annual compound growth rate of about 54%. In terms of the additional value per vehicle, the unit price of automotive glass is expected to increase to about 1200 yuan per vehicle by 2025.

However, all of this depends on large-scale production. The wet coating production method of Guangyi Technology has made it possible for electrochromic technology to have low cost, high specifications, and high yield for the first time.

Electrochromic technology used to be based on glass, such as the technology of pouring a layer of liquid into two layers of glass, like the perkin reaction. The second-generation tungsten oxide was directly plated on the glass through the plating process, but with poor stability. Guangyi Technology, on the other hand, is actually doing thin films that can be coated on a film like a newspaper.

“Both in the industry and in academia, it is believed that it is difficult to achieve mass production of flexible devices through roll-to-roll production within 3-5 years. So when we launched the first and second generation mobile phone products with OPPO, many people did not believe that such roll-to-roll flexible film devices could really be mass-produced.”

After continuously optimizing materials, optimizing film substrates, and improving coating equipment, Guangyi Technology finally developed the technology to produce electrochromic materials on thin films with a roll-to-roll process.

“I think it’s a huge leap from mobile phones to cars. Our product strategy is now moving towards cars, which is a big step forward. It’s also the first time such a product has appeared in the industry,” said the head of Guangyi Technology.As the leader of the third-generation electrochromic technology, Guangyi Technology has been ahead by several positions in this field.

“Guangyi leads this field, and currently, we are the only ones in the world who can produce electrochromic sunroofs in large quantities,” said the head of Guangyi Technology to AutocarMax.

In the future, Guangyi Technology will comprehensively solve the problems of vehicle light and heat control, complete the technical closed loop of automotive light and heat management, launch solutions for private light control and comfortable heat management of the entire car, upgrade and iterate a series of product lines from the front windshield, side windows, rear side windows, sunroof, to rear window, making the “third space” of the car more complete. At the same time, the high-tech anti-glare rearview mirror product will improve driving safety comprehensively from the inside to the periphery of the car, achieving a full-line upgrade of automotive products.

Looking back, Guangyi’s strategy is undoubtedly clear.

“When the company was just established four years ago, we clearly recognized that intelligent cars as the third space were definitely the future trend,” said the head of Guangyi Technology. “With the advent of autonomous driving, people will have higher requirements for comfort, light and heat regulation in the car.”

For such a national high-tech enterprise, we are also pleased to see it rising with the wind and soaring upward.

As Wei Zhen, co-president of Huaping Investment China, said, “I see the grand ideals of scientists and the perseverance of entrepreneurs in them. We are very honored to work with such outstanding Chinese scientists and entrepreneurs and we will also accompany Guangyi on its long-term journey to become the global champion of the industry.”

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.