The Iperionx Ltd (ASX: IPX) share price is having a sensational day.
In morning trade, the ASX titanium share was up as much as 76% to a record high of $1.67.
IperionX's shares have since pulled back a touch but currently remain up 53% to $1.45.
Why is this ASX titanium share rocketing higher?
Investors have been scrambling to buy the company's shares today after it released a major announcement.
According to the release, the company has agreed a Scope of Work (SoW) with Ford Motor Company (NYSE: F) for the supply of titanium metal components to Ford Performance using its unique 100% recycled, low-carbon titanium metal.
Ford Performance is the high-performance and racing division of the Ford Motor Company. It is responsible for a range of performance cars such as the F150 Raptor, Bronco Raptor, Mustang Mach 1, and the Shelby GT500.
Management notes that the Ford SoW follows a detailed program of quality and strength testing of IperionX's low-carbon, circular titanium metal. Ford's Sustainability and Advanced Materials divisions undertook a range of testing procedures, verifying that IperionX's titanium surpassed the required parameters set under international standards.
The release reveals that the titanium components are set to undergo a comprehensive "finishing study" to assess a range of potential surface finish of parts. The insights gained from this SoW will guide the final design, and unit costs, for a range of low-carbon titanium components for Ford Performance production vehicles.
IperionX's CEO, Anastasios Arima, said:
Ford has a commitment to achieve carbon neutrality by 2050. We are proud to partner with Ford to accelerate the deployment of a sustainable, circular titanium supply chain for the global automotive market. Our low-carbon titanium metal is uniquely made with 100% recycled titanium and can significantly improve automotive supply chains by using high-strength titanium components with nearly half the weight of steel.
IperionX is re-shoring a lower cost and more sustainable U.S. titanium supply chain – shifting from a linear supply chain to a lower carbon, circular titanium supply chain – recycling titanium scrap to manufacture low carbon, high performance titanium components. We are pleased that Ford has partnered with us to improve automotive supply chains and scale our low-carbon, circular, titanium business.
This ASX titanium share now has a market capitalisation of approximately $280 million. This means the announcement of the deal has added around $90 million to its valuation today. Whether this deal justifies that, time will tell.