In this segment of "Industry Focus" on Motley Fool Live, recorded on Dec. 2, Fool analysts Auri Hughes and Nick Sciple chat about XPEL (XPEL 0.69%) and the unique business it has built.
Auri Hughes: It's an interesting business. Basically, if you have a car, it could be a sports car or just a car you're excited about and you want to protect it from rock chips and debris and those things that naturally happen as you drive the car, you can get this paint protection film that was actually used by the military back in the day that we found out had these applications where you can put it on cars and have it applied and it protects from rock chips, from paint debris, but you can't see it. It's invisible. It looks just like the paint was there. It's not visible to the naked eyes. It's really exciting for car enthusiasts or people that just want to protect their car.
Nick Sciple: When you think about the guy with the sports car that parks across two parking spots to make sure nobody dings up his car, this is really the target market for this guy. Then the cool thing about this too is the paint protection film is self-healing, so you can scratch the film. But then you heat it with some heat and magically, it's good as new, which obviously is very attractive when you're spending tens of thousands of dollars. Historically, they've served with the high-end sports car market. These folks are very particular about their vehicles.
Hughes: Definitely, yeah. You're excited about your car if you're making this investment.
Sciple: Yeah. I think one of the other interesting things with XPEL as well is that they're not just providing this film, but they have a software differentiation that really has helped them grow.
Hughes: Yeah. Definitely, the DAP or the DAP software provides the cutouts of the cars, and it's just this huge library and database of the different models of cars. Once you go in there, you find your model of car then it'll cut out the film and the shape of the car, so I think it just helps in the application so you don't have to cut it yourself or do all those things that probably makes the labor a lot easier.
Sciple: Yeah, exactly. So really attractive for the installers of this film, less waste, you can produce quicker.
