Zoltek Corporation - Adapting Together With Andrew Whipple

Summary

In this podcast episode, Andy from ztech discusses the company's focus on carbon fiber production and its applications in various industries, particularly wind energy. As the Chief Financial Officer, Andy highlights ztech's global operations, the importance of aligning international business practices, and the impact of geopolitical tensions on supply chains and costs. He also touches on the company's growth potential, driven by the increasing demand for alternative energy solutions and the future of air taxis and renewable energy technologies.

Takeaways

• 🎧 The podcast is developed by the Boeing Institute of International Business at St. Louis University's Chaifetz School of Business.
• 🌐 World Trade Center St. Louis is highlighted for empowering organizations to thrive on an international scale.
• 🔢 Andy, the CFO of Ztech, discusses his 16-year tenure and his role overseeing accounting, finance, taxes, IT, and logistics.
• 📈 Ztech is focused on the commercialization of carbon fiber, aiming to be a low-cost provider to promote its use in various applications.
• 🌟 Carbon fiber is portrayed as a strong, lightweight material with applications in wind turbines, automotive parts, and potential future uses like air taxis.
• 🌱 Ztech's founder, Zol roomy, is recognized for his vision in commercializing carbon fiber, which the company continues to pursue.
• 🌍 The company has manufacturing operations in Hungary, Mexico, and the US, strategically located to serve different markets and ensure supply chain resilience.
• 🔄 Ztech is committed to utilizing all its carbon fiber products, minimizing waste through downstream processing like chopping and milling.
• ⚖️ Global tensions and trade barriers, such as those between the US and China, impact Ztech by increasing costs and affecting supply chains.
• 🔑 The future of Ztech is tied to the growth of the wind industry, the development of new applications for carbon fiber, and the company's ability to reduce production costs.

Q & A

What is the main focus of the 'Conversations That Matter' podcast?

The podcast, developed by the Boeing Institute of International Business at St. Louis University's Chaifetz School of Business, focuses on international business topics, aiming to communicate knowledge to students and the podcast community, helping them with career growth and success.

What is the role of Andy, the interviewee from ztech, in the company?

Andy is the CFO (Chief Financial Officer) of ztech, responsible for accounting, finance, taxes, information technologies, and purchasing and logistics.

How has ztech been preparing for advancements in artificial intelligence?

ztech has been preparing for artificial intelligence by implementing Microsoft AX across all global operations and introducing business intelligence through PowerBI to align operations worldwide.

What is the significance of the precursor material in ztech's production process?

The precursor is a white material derived from acrylonitrile and is a key starting point in ztech's carbon fiber production process. It is transformed into carbon fiber, which is then used in various applications, emphasizing ztech's commitment to full use of their products and minimal waste.

How does ztech utilize carbon fiber in different product forms?

ztech manufactures carbon fiber and creates downstream products such as chopped fibers for use in items like laptops, and pre-preg plates which can be used in more complex applications, demonstrating the versatility of carbon fiber in various industries.

What is the relationship between ztech and Tor, and how do their product focuses differ?

ztech is a subsidiary of Tor. While ztech focuses on commercializing carbon fiber and being a low-cost provider, Tor is a high-end manufacturer known for precision and quality, with their materials often used in applications like airplane fuselages.

How does ztech's international presence, with operations in Hungary, Mexico, and the US, contribute to its business strategy?

ztech's international presence allows it to serve different markets effectively. The plants in Hungary and Mexico produce the main carbon fiber products, while the US focuses on downstream production, leveraging lower labor costs in Hungary and Mexico and the ability to serve the Americas and Europe from these locations.

What cultural aspects does Andy highlight in his experience working with ztech's international teams?

Andy emphasizes the strong work ethic and dedication across all cultures at ztech. He also mentions the importance of shared activities and experiences, like food and local events, in fostering a collaborative working environment.

How is ztech's growth tied to the wind industry, and what are the opportunities for future growth?

ztech's growth is closely linked to the wind industry, as carbon fiber is used in wind turbine blades. The company sees opportunities in the continued growth of the wind industry, the increasing size of wind turbines, and the expansion into offshore wind energy. Future growth may also come from emerging applications like air taxis and tidal turbines.

What challenges has ztech faced due to global events such as the conflict in Ukraine and tensions in the Red Sea?

ztech has faced increased energy costs and supply chain disruptions due to the conflict in Ukraine, which affected their Hungarian plant. They also had to adjust supply routes due to the Red Sea tensions, leading to higher shipping costs. These events highlight the need for ztech to be adaptable and maintain a global supply strategy.

What is ztech's stance on global trade tensions, and how do they plan to navigate these challenges?

ztech prefers a calm and free global trade environment with minimal tariffs and barriers. They aim to be a low-cost provider, and any trade tensions that lead to increased costs can affect their business. They plan to navigate these challenges by being experts in their business, ready to adjust to any global shocks.

Outlines

00:00

🎙️ Podcast Introduction and Ztech Overview

The podcast, 'Conversations that Matter,' developed by the Boeing Institute of International Business at St. Louis University's Chaifetz School of Business, features an interview with Andy from Ztech, a company specializing in carbon fiber production. Andy discusses his 16-year tenure as CFO, covering responsibilities including accounting, finance, taxes, information technology, and logistics. The conversation highlights Ztech's commitment to utilizing artificial intelligence and business intelligence systems like Microsoft AX and Power BI to align global operations. Andy also touches on Ztech's full utilization of carbon fiber, creating a range of products from precursor materials to complex components for industries like automotive and aviation.

05:01

🌐 Global Operations and Cultural Insights

Ztech's global presence is discussed, with manufacturing in Hungary, Mexico, and the US, serving various markets including Europe and Asia. The company's approach to embracing the commercialization of carbon fiber across different cultures is highlighted, showing a unified vision despite diverse backgrounds. Andy shares his experiences working with international teams, emphasizing the importance of understanding and respecting cultural differences, such as food and traditions, to foster a collaborative environment. The company's strategy to serve the wind industry is also mentioned, with a focus on producing carbon fiber for larger wind turbines to meet the growing demand for alternative energy solutions.

10:01

🔌 Impact of Global Events on Ztech

The podcast delves into the impact of global events on Ztech's operations. The conflict in Ukraine has led to increased energy costs and supply chain disruptions, particularly affecting the Hungarian plant. The company has had to reconfigure supply routes and support affected employees. Additionally, geopolitical tensions, such as those between the US and China, have resulted in tariffs that increase the cost of doing business. Andy emphasizes the importance of being adaptable and prepared to adjust to such global shocks, ensuring business continuity and customer satisfaction.

15:03

🚀 Future Opportunities and Challenges for Ztech

Looking ahead, Ztech sees unlimited potential in the growing demand for carbon fiber in emerging applications like air taxis and tidal energy systems. The company's mission is to continue reducing production costs to make carbon fiber more accessible for a wider range of uses. Andy discusses the opportunities in renewable energy and the need for lightweight materials in new transportation concepts. He also acknowledges the challenges posed by global tensions and the desire for a level playing field in international trade. The conversation concludes with a tribute to Ztech's founder, Zol roomy, who was instrumental in driving the company's vision of commercializing carbon fiber.

Keywords

💡Ztech

Ztech is a company that specializes in the production of carbon fiber. In the script, it is described as a company with a vision for the commercialization of carbon fiber, aiming to be a low-cost provider. The company's operations are tied to the growth of the wind industry, as carbon fiber is used in the manufacturing of wind turbine blades. Ztech's products are also used in various other applications, such as in the automotive and aerospace industries, due to the material's strength and lightweight characteristics.

💡Carbon Fiber

Carbon fiber is a strong, lightweight material made from small fibers about 5-10 micrometers in diameter. It is used in various industries for its high strength-to-weight ratio. In the context of the video, Ztech manufactures carbon fiber and aims to utilize it in a wide range of applications, from wind turbines to automotive parts, to promote its commercial use and reduce manufacturing costs.

💡Precursor

The precursor is a white material derived from acrylonitrile, which is a key component in the production of carbon fiber. In the script, it is mentioned that Ztech starts with the precursor material, which is then processed to become carbon fiber. The precursor is a critical part of Ztech's manufacturing process and is used to demonstrate the transformation into the final carbon fiber product.

💡Wind Industry

The wind industry refers to the sector focused on harnessing wind power to generate electricity. In the script, it is highlighted that Ztech's growth is closely tied to the growth of the wind industry, as carbon fiber is used in the construction of wind turbine blades. The increasing demand for alternative energy sources like wind power presents a significant opportunity for companies like Ztech that supply materials used in wind turbine production.

💡Global Shocks

Global shocks are unexpected events that have a significant impact on the global economy or specific industries. In the script, the discussion of global shocks includes the conflict in Ukraine and its effects on energy prices and supply chains, as well as tensions in the Red Sea affecting shipping costs. These events have direct implications for Ztech's operations, demonstrating the need for businesses to be adaptable and resilient in the face of global uncertainties.

💡Supply Chain

A supply chain is the network of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. The script mentions that Ztech had to reconfigure its supply chains due to geopolitical conflicts, which impacted the sourcing of materials. Efficient supply chain management is crucial for Ztech to maintain production and meet customer demands despite global disruptions.

💡CFO (Chief Financial Officer)

The Chief Financial Officer is the executive responsible for an organization's financial matters, including accounting, financial planning, and risk management. In the script, Andy, the CFO of Ztech, discusses his role in overseeing the financial health of the company, as well as his involvement in areas like information technology, purchasing, and logistics. His perspective provides insight into the financial strategies and challenges faced by Ztech.

💡Artificial Intelligence

Artificial intelligence (AI) refers to the simulation of human intelligence in machines to perform tasks. In the script, it is mentioned that Ztech is preparing for the introduction of AI in its operations. The company has implemented Microsoft AX and Power BI to align its global operations, indicating a move towards leveraging AI for business intelligence and efficiency.

💡Downstream Products

Downstream products are goods that are manufactured or processed further along the supply chain. In the context of the video, Ztech not only produces carbon fiber but also creates downstream products such as chopped fibers and pre-preg plates, which are used in various applications like automotive parts and aerospace components. This approach allows Ztech to utilize all its carbon fiber and minimize waste.

💡Commercialization

Commercialization is the process of introducing a new product or service to the market to generate revenue. The script emphasizes Ztech's goal to commercialize carbon fiber by making it a more affordable alternative to materials like steel and fiberglass. This strategy aims to increase the adoption of carbon fiber in various industries, thereby driving the company's growth.

Highlights

Introduction of the podcast 'Conversations that Matter' by the Boeing Institute of International Business.

Sponsorship acknowledgment by World Trade Center St Louis for empowering global business success.

Andy's 16-year tenure at ztech and his role as CFO covering accounting, finance, taxes, IT, and logistics.

Integration of Microsoft AX and PowerBI for global operations alignment at ztech.

Ztech's commitment to utilizing all carbon fiber products, minimizing waste.

Explanation of the carbon fiber production process from precursor to finished product.

Demonstration of carbon fiber's strength and lightweight properties compared to steel.

Ztech's role as a low-cost provider of carbon fiber, aiming for widespread commercial use.

Comparison of ztech and Tor, highlighting their market positions and product precision.

Cultural experiences and work ethics across ztech's international operations.

Strategic setup of ztech's manufacturing plants in Hungary and Mexico for cost-effective production.

Ztech's growth potential tied to the expanding wind industry and increasing turbine sizes.

Impact of global conflicts on ztech's energy costs, supply chains, and employee base.

Ztech's adaptability to geopolitical tensions and trade barriers, emphasizing the need for a level playing field.

Future opportunities for ztech in emerging markets like air taxis and renewable energy technologies.

Tribute to Zol roomy, ztech's founder, for his vision and contributions to carbon fiber commercialization.

Closing thoughts on ztech's future, emphasizing the importance of innovation and cost reduction.

Transcripts

slooh international business now

conversations that matter is a podcast

developed by the Boeing Institute of

international business in St Louis

University's chaitz School of Business

special thanks to founder Dr Sun Kim for

his Grant to support the launch of this

podcast today's episode is brought to

you by World Trade Center St Louis

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we Empower your organization to thrive

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your local partner visit world trade

center- stl.com for more information

Andy thanks for joining me today on the

St Louis University international

business Now podcast it's great to be

here thank you so Andy you you've been

with ztech for 16 years tell me about

your background and your history with

ztech yeah Jeff first off on behalf of

zolte and the team at Tory Industries

really appreciate the opportunity to

participate in this podcast I believe

the efforts that you're making to

communicate international business to

the students and to those in the podcast

Community I think it's wonderful it's

great and I'd like to think today we we

have some great stories to tell we have

a good time talking about our industry I

think the materials that we cover here

will be help ful for their career growth

and for their success with regards to me

personally yeah I've been here for 16

years wow seems like a minute it's it's

just flown by and I am the CFO or Chief

Financial Officer I've been responsible

for accounting Finance taxes the normal

CFO kind of stuff but I've also been

responsible for information Technologies

and for purchasing and Logistics as an

example in the area of it wow it's been

crazy right with the world of artificial

intelligence and what's coming

fortunately zte's been working hard in

that area to get ready for that and so

back in 2017 we put in place Microsoft

ax as an example and we put that across

all the world uh operations so Hungary

Mexico the US and then we put in

business intelligence so powerbi is the

intelligence system and those are are

geared towards getting everybody on the

same page right we we need all of these

operations across the world to be

aligned with each other so we've thought

about that and we're getting ready we

just lifted our ax system up into the

cloud and we're getting ready for

artificial intelligence in that

introduction but we need to make sure

that the data is harmonized across all

all the world so that's the type of

thing that I've been involved with as

well as the purchasing and Logistics and

making sure that all of these plants are

are working and operating well

together that's fascinating and ztech is

a is an interesting company for sure

tell our audience a little about zolte

and what is carbon fiber I think think

that you know talking about carbon fiber

is really starts with a story about

product we make called precursor so this

is the precursor it's a it's a white

material and it comes from acry nitrol

so acry nitrol you can feel that if

you'd like but we bring that in by rail

car to the plant and acry nital would

look like a liquid and it's made of

polypropylene and ammonia and that

material would go into this precursor

and then that precursor process ends up

in a big spool of this white material

precursor and then we put that on the

front of our carbon fiber lines and then

the goal is to take that precursor and

turn it into this this would be our

carbon fiber and ztech believes in full

use of our product so we don't like to

waste anything at ztech it's really

important for us so we not only make the

carbon fiber and the oxidized fiber we

also make Downstream products so this is

an example of a of a chopped product so

you can see these there you go just a

little bit of that there and that would

go into something like let's say a

laptop right so there's a really good

product form they put it into a let's

say a mold and add some resin to it and

you could make a laptop out the area of

carbon fiber we also make a p Tred plate

so this these toes run into to a d and

then we can make a ped

plate okay and then those ped plates and

those types of products can get more

complicated this is an example of a more

complicated part light is a feather yeah

light is a feather light is a feather

yeah exactly right will you be willing

to demonstrate something for me okay

okay so I'm going to give you a piece of

Steel oh goodness can you hold that up

okay that's a piece of Steel and now oh

you can see how heavy that is maybe 25

pounds 25 pounds this is that same bar

in carbon fiber three

pounds isn't that great yeah so yeah

really important that that um weight

characteristic versus the strength

characteristic really really important

and you can substitute obviously any

sort of weight application the choosing

steel hopefully with a carbon fiber

application as an example and ztech is

is a manufacturer of the materials so

where're the materials manufacturer and

then we'll go again we'll go Downstream

in that material manufacturing for the

different types of product that we have

but the idea is to utilize all our

carbon fiber no waste if at all possible

so we'll start with the toe then we'll

chop it and then we'll Mill it but no

Carbon Fiber goes to waste at ZTE great

well thanks yeah yeah thanks Andy you

mentioned té the owner and shareholder

of of ztech tell me about the

relationship between ztech and Tor yeah

so it's you know it's been an

interesting Journey as you talk about

that relationship ztech was founded by

Zol roomy and Z was a visionary and he

had this idea of the commercialization

of carbon fiber and so in that Vision we

ztech are like the Walmart of carbon

fiber right we commercialize it we're

the lowcost provider of that and that's

intended we work every day relentlessly

to try to reduce that cost of

manufacturing so we can commercialize it

well why commercialize it well because

it's a substitute product if we can make

the carbon fiber less expensive then

that makes it more acceptable to an

application right so they could use

steel or they could use fiberglass but

if we can get the cost down then we can

compete with those materials and get the

carbon fiber introduced into that

particular application so wind has a

been been a big application for ztech

and again we talked about that large toe

that 50,000 filaments that's really

important because when you need mass of

material for an application then zte's

the good answer to that now that in

contrast to somebody like Tor Tor is the

high-end manufacturer like the Tiffany

right they they make the gold standard

of the high-end product now instead of

50,000 filaments they'll do 3,000

filaments or 6,000 filaments now why do

they do that because then they can have

more precise characteristics right the

Precision of their manufacturing

processes is far superior to that of Zex

but that's all good that serve they

serve their markets and we serve our

markets so we we complement each other

but their material will go into things

like an airplane right so the fuselage

of the airplane this the Dreamliner the

787 is the perfect application for

something uh of Tes now of course

there's cost more but if you can afford

it or you need it for that particular

application then tor's product is the

right product for that and if it's more

commercial if it's you know more

standard like an auto uh example and

we've got some examples around here

here's the the hood of a car I won't

lift this up but the hood of a car or

the the roof of a car are then Zex

material might be more appropriate for

that type of application Tor is a is a

Japanese company and we're at an

international business podcast here so

and you have operations in Mexico and

Hungary and so tell me about the

cultures of ztech I'm assume those

multiculture or true inter International

culture I've always been an

international traveler I'm I'm a

military brat but coming to zolte was of

course at a business level very exciting

and the opportunity to deal with Hungary

and Mexico and Japan as I I've done is

wonderful now Tori acquired zuk in about

2014 so originally we were a publicly

traded company and then when Tori

acquired us we went through that process

in around 2014 then we started to work

with Japanese culture too so what I

found is that across these cultures

everyone can embraced the idea of

commercialization of carbon fiber all

the different cultures can get excited

about working with that so when we deal

with the management teams whether they

be in Hungary Mexico the US Japan

everybody can understand that vision and

culturally can get around that like this

is exciting let's work on this let's

together Drive the this um alternative

energy this these Solutions and we know

we're enablers we we're helping to

create a better culture We Believe here

at ztech a culture that believes in a

future with the commercialization of

carbon fiber helping these alternative

energies helping with wind turbines that

so when we think about working with

these different cultures of course all

of our interactions are in English so

somebody might wonder well how do you

how do you talk to each other so all the

business meetings have to be held in

English most of our contracts are

written in English so thank goodness

because I know the one language I'm not

so good at the others but all of our

meetings do happen in that format and we

can work together in that format now

when you talk about the operational

lines that's a bit of a different story

right when we ztech have these big

carbon fiber lines right and they might

be almost the length of a football field

so we need a lot of employees working on

those lines and that's a lot of hard

work and what we found is in each of

these cultures there's a great work

ethic I mean these people are dedicated

to making sure that we produce the kind

of products that we need to make and you

can see that I walk these lines I I

shake the hands of these employees

they're great people and I love working

with them each and every day we we call

that working at the gmba so in in

Japanese talk the gmba is the the plant

and that's where we go and that's where

we get to work with these guys so I love

that aspect of their cultures and I love

their dedication their work ethics now

where do we see some differences

actually in some of the funner areas

which is like food oh my goodness it's

it's a little bit it's a little bit

maybe unintuitive but when you travel

the world you have to be ready for the

culture of of different foods when I go

to Hungry For example I've learned to

eat sheep fish that's a pretty heavy

fish but i' I've learned to enjoy that

and of course I've learned to drink

pinka what is what is pinka well in in

Hungary no fruit is safe right so pinka

is derived from whether that be oranges

or or peaches any sort of fruit is going

to be turned into alcohol and you're GNA

have a chance to drink some pinka when

you're sharing times with those teams

and obviously goulash so you you need to

get that that sense of the variety but

breaking bread and being with those um

Partners is really important so I need

to be flexible as an international guy

but those types of cultural differences

help us to bridge by by having this time

to break bread by being together create

a tighter culture and a better working

environment for us so I have to be

adaptable as I move into these different

cultures in Mexico for example they like

to do wrestling I think it's mucho Libre

and so we'll go to a wrestling match for

example so but that interaction and

being with people those are what makes

us all collaboratively work together and

I love the opportunity to be a part of

these different cultures and work but

the dedication that ability to be a part

and work with these people is is

absolutely wonderful ztech has

Manufacturing in three countries and

tell me why is it set up this way how

does that work tell me about the the

setup yeah that's a great question

actually Z roomy gets credit for this Z

actually set up the plants in and

purchased the plants in Hungary and in

Mexico both of those were they were

acrylic plants so zol's vision of

commercialization was we needed to get a

lowcost manufacturing location so in

Hungary was an opportunity to buy an

acry plant and we converted it so we got

it at a low cost and then we started to

upgrade we we converted the Machinery

that was there into the precursor

components that we needed so in both

Hungary and Mexico we had these big big

acrylic plants that we converted into

the precursor production that white

material I showed you earlier then once

we' done the conversion on those we

added the carbon fiber lines which

didn't exist at the plants at all but

Z's vision of commercialization was

let's convert these acrylic plants into

the uh precursor we need and then let's

add the carbon fiber components and so

having that manufacturing plant in

Hungary to service the Europe in in

Mexico to service the Americas was his

vision as to how we wanted to get the

company initially started and we

executed on that Vision now the ability

to sell into Asia we can then use either

one of those plants depending on the

best economics in order to serve the

Asian markets but those plants produce

our main product the carbon fiber I

showed you earlier

and then the downstream production

there's some Downstream production like

the milling and chopping in either

Hungary or Mexico but then in the US we

do pretty much just Downstream pusan as

an example and then we ship worldwide

with that obviously the labor costs are

lower in hungry in Mexico and so that

that's a great place when you have a lot

of employees in the US Labor is a little

bit more expensive so then the

downstream is a little bit more

appropriate for this particular Market

Andy is is ztech growing and what what

are the opportunities for ztech yeah

zolte is highly tied to the wind

industry so first off you have to ask

yourself is the wind industry growing

because we're just we're tied at the hip

together and ztech is an Ena of that

wind industry so let me explain that a

little bit more so first off the wind

industry itself the wind industry is an

alternative energy has been something

that the governments have embraced and

people have embraced in the wind turbine

industry has been growing very well and

I'd say it's been growing at a at a rate

and you can see this in some of the uh

uh statistics that are published

worldwide that the growth rate has been

about 14 15% of thereabouts and that

growth rate is expected to continue so

we at ztech are going to benefit just

from the fact that the industry is

growing and that there's a demand for

alternative energy so that's a a key

area of that growth now so again we've

benefited from that that just growth in

the industry now in addition to that

growth in the industry is the growth in

the size of the wind turbines right if

you want to produce more energy the idea

is to make those wind turbines bigger

and bigger well the bigger they get the

more carbon fiber so as the designers

have designed bigger and bigger wind

turbine energies in order to produce

more energy for us the public and all

those electric cars that people are are

driving around well are carbon fiber

going into those blades as they get

bigger and bigger as an important

contribution again we get the growth

from that now there's another category

of growth in wind turbines which is

important which is onshore versus

offshore so an onshore wind turbine

tends to be a little bit smaller than

the offshore wind turbines now why is

that well because planes are flying

around and helicopters are flying around

so they tend to keep them a little bit

shorter so they don't get run into

offshore doesn't tend to have those

limitations so we have the growth in the

offshore offshore tends to be closer to

the cities right so the city is where

you need the electricity so if you can

build wind turbines of large size right

off the coast of a city then you're

ideally situated so those are also

growth trends that zolte believes that

it will be participating in so we're

very excited about that opportunity and

we think it's going to be a great

opportunity for us to continue to grow

our business so next time I drive by a

wind farm I should think of zolte that's

right you should think of ztech

absolutely okay we've been talking a lot

about opportunity and growth let's talk

on the impact of the global shocks the

attacks in the in the Red Sea things

like that you know as I noted I am the

CFO that's also in charge of like

purchasing and Logistics so I get front

and center on some of these things as it

relates to Ukraine it's such a sad

situation you know to have that conflict

going on and it has impacted ztech

tremendously the initial Invasion caused

Energy prices to spike in Europe and

that was consequential right we suddenly

had our energy costs going up now we had

some contract to protect us a little bit

but uh those contracts expire over time

and the conflict just kept going and

going so yeah the energy costs are

disruptive and of course the supply

chains we actually had some business

supply of materials coming in from

Russia or bellarus and those Supply

chains had to be reconfigured right we

had to be able to get our materials now

from whether it be Western Europe or

from Asia or the Americas shipped into

our plant in Hungary so obviously the

plant in Hungary is the most impacted

not such a big deal in this case with

regards to Mexico now another impact was

the employees now as I noted ztech of

course employs hungarians but we also

employ slovakians and ukrainians so we

had a number of Ukrainian workers

working for us and those ukrainians

unfortunately a lot of them were called

back to their country to deal with the

conflict and you know we can do our best

to try to support the families there uh

eventually as they go back we have to

replace those jobs with H slovakians or

hungarians but we do look forward to

that conflict ending and getting those

employees back into our family now when

we look at something like the Red Sea

that's a little bit different for us in

the sense that that's a little bit more

Regional it's is disruptive right we

would like the low cost of shipping

through those Lanes but we can adjust

right now it's going to be a little bit

more costly it's not going to shut down

our production but it is going to

increase our cost of production so we

prefer obviously not to have those

conflicts but those are are actually a

little bit easier to overcome you know

it's it's interesting you think well

it's just those types of things that get

you right I think the point about any

disruption that occurs in the world is

we're supposed to be experts at our

business and we're supposed to be

experts at anything that can actually

transpire anywhere in the world our

business doesn't stop so we have to be

prepared to adjust you are not going to

know everything that's ever going to

happen but what you have to do is know

your business well enough and how you

can be able to adjust that business for

any of these shocks that do occur and

that's as a as a person that

participates on the global stage that's

the way I think right every day is we'll

see what happens today does everything

stay the same or did something change

and if something changes we need to

adjust and that's what we did and I

guess having Manufacturing in two

continents helps to uh cushion some of

those chocks that's exactly right so our

customers need to be kind of dual

sourced right so if we have for example

a flood that might occur on the danu

river well then we need to be able to

source for Mexico or conversely if

there's a hurricane that would occur in

Mexico then we need to Source from

Hungary and our customers need that

level of comfort so by having the two

different manufacturing plants that is a

guarantee of supply for them we try to

do our best to make sure that we can

handle that either through the

inventories of materials or the plants

themselves good question so another uh

unanticipated thing the the tensions

between us and China switching our view

to Asia tell me about what if any uh

impacts that has on on ZTE sure you know

worldwide tensions whether they be with

China or with anyone else are never

helpful we would obviously prefer a very

calm work environment business

environment but of course when these

tensions arise usually with the tensions

comes tariffs so probably the most

impactful part is that tariff or that

cost of doing business and in the case

of Chinese tariffs for example that's

going to increase the cost of our

material going into China now some of

our customers might be willing to pay

that because again they want to be dual

sources we mentioned before so they

might be willing to pay that cost of

that tariff to go into that environment

fine but conversely that means maybe

there's tariffs in Europe or the

Americas right and those tariffs can

affect them it might benefit us but you

know we prefer to just have a Level

Playing Field so we prefer that the

tensions go down we prefer that there

just be free trade and we we again we're

a commercial manufacturer we want to be

the lowcost provider it's in our

interest to have as few costs as

possible as few barriers as possible so

that we can sell our product into these

foreign markets looking forward what are

the opportunities for ztech when you

think about the potential for ztech into

that future the potential really is

unlimited why is it unlimited well

because our job is to continue to reduce

that cost and if we can reduce that cost

then we can substitute into more and

more applications so we feel every day

that we wake up that our job is to

continue to drive that cost so that we

can create more and more acceptance into

this world around us now that said there

are applications that are coming into

existence that are really well situated

for what we are and what we can provide

so for example vetto or air taxis W that

sounds pretty cool right we could all be

flying around soon I'm pretty excited

about that but obviously you want to

keep your vehicle low weight so that you

can carry more people or packages or

whatever it might be so that tradeoff is

natural so as things as electric motors

become more powerful as the idea of air

taxis and these other Concepts come into

existence and I am convinced they're

going to come into existence then we

think there's going to be opportunities

for carbon fiber into that type of

application now when we talk about

renewable energy while wind turbines

have been a great segment for us there's

all also things like tidal turbines

right so those those waves that are

shifting on and off on the shore well

those could be generating power too so

carbon fiber could be good for that

because there's a lot of corrosion that

occurs out in the ocean right all that

salt well carbon fiber isn't affected by

that so carbon fiber would be a good

solution for that possibility so our job

every day is to continue to unlock that

value that exists into whatever those

applications are we want to empower

those Engineers to be able to use our

material to substitute it in in order to

create more value for the world around

us and that's what the employees

dedicated towards sounds like té had a

lot of vision to the Future when they

acquired ztech absolutely we we think so

so finishing up what other comments do

you have for our audience I'd also like

to take this as an opportunity to

celebrate Z roomy Z roomy our founder he

passed away this year but he has been

and was an inspiration and a driver of

this concept of commercialization he was

the initial believer in these Concepts

and we inited those Concepts we're there

to continue to drive that Vision into

the future and Tor as our partner is

helping us do that so we believe we're

still at the Forefront of that I

remember sitting with Z on many

occasions and talking about the concepts

of driving down cost and unlocking these

opportunities he had that vision and I

shared that Vision with him so now we've

inherited that Vision that's a vision we

take forward and I'd ask your viewers

your podcasters watch us we think

there's exciting times to head we think

the world's an exciting place to be a

part of and we're looking forward to

seeing what we can accomplish and I'm

certainly looking forward to seeing what

comes from the future students at jur

University as well as the the people

that are participating today because

those will be the people that take on

the roles like mine and create that

future which I think is a very exciting

place so thank you very much for this

opportunity to be here today thanks Andy

we look forward to hearing more from

ztech all right thank you very much

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