Honeywell(US:HON)2023-03-28 22:22Summary of Honeywell International Inc. (NASDAQ:HON) Jefferies eVTOL Summit Conference Transcript Company Overview - Company: Honeywell International Inc. - Division: Honeywell Aerospace - CEO: Mike Madsen - Sales Contribution: Aerospace accounts for 40% of Honeywell's sales [2][3] Industry Focus - Market: Urban Air Mobility (UAM) - Market Size: $7 billion in content wins and a market pipeline exceeding $10 billion [9] - Growth Projection: Expected to be a significant market by the end of the decade, with a revenue target of $2 billion [15] Key Points and Arguments 1. Role in UAM: Honeywell acts as both a component supplier and a systems integrator, providing certification support and regulatory guidance [4][5] 2. Technological Offerings: Honeywell's technologies include cockpit systems (Anthem), actuation systems, cooling systems, electric motors, and fly-by-wire computers [5][10] 3. Regulatory Engagement: Honeywell engages with regulatory authorities and participates in industry groups to shape standards for UAM certification [8][39] 4. Investment Strategy: Honeywell employs a bifurcated investment approach, focusing on core products while also tailoring applications for specific customers [12][13] 5. Partnerships: Collaborations with companies like DENSO for e-motor development and a focus on high-volume manufacturing capabilities [13][18] 6. Market Entry Timeline: Anticipated entry into service for UAM vehicles around 2025, with a gradual ramp-up in revenue expected to follow an S-curve pattern [15][16] 7. Growth Rate Expectations: Initial slow growth expected, transitioning to strong double-digit growth in the latter half of the decade [20][21] 8. Geographic Focus: Adoption is expected to occur simultaneously across developed regions, including the U.S., Europe, and Asia-Pacific [23][24] Additional Insights - Anthem System: A new cockpit system that is modular, lightweight, and connected, allowing for enhanced functionality and potential recurring revenue streams from software enhancements [26][31] - Operational Challenges: The need for operational regulations to catch up with certification standards, particularly concerning autonomous operations and navigation technologies [41][42] - Pilot Training Evolution: The industry is moving towards single-pilot operations, necessitating advanced avionics capable of managing most flight operations autonomously [44][45] - Infrastructure Development: Honeywell is exploring its role in UAM infrastructure, focusing on logistics management systems for rapid recharging or battery exchange [50][51] - Market Drivers: Growth in e-commerce and the need for efficient urban transport are key factors driving the UAM market [53][54] Conclusion Honeywell is strategically positioned in the emerging UAM market, leveraging its technological expertise and regulatory engagement to capitalize on significant growth opportunities. The company is focused on innovation, partnerships, and addressing operational challenges to ensure successful market entry and expansion.