Quick – name a Chinese electric vehicle manufacturer. You probably called out Nio (NYSE:NIO) as that’s the most famous one, especially to stock traders. Yet, you might be missing an important opportunity in Kandi Technologies Group (NASDAQ:KNDI). Indeed, an upcoming event could boost the KNDI stock price substantially.
Nio has admitted its ambition to have a global presence that includes the United States. However, Nio’s stock holders might have to wait a while before this vision becomes a reality. In contrast, KNDI shareholders could enjoy a nice surprise as Kandi is commencing a major push into the American automotive market.
No one knows whether this initiative will be successful or not. Investing in smaller electric vehicle companies is risky, so don’t bet the farm on Kandi stock. Instead, you can take a small position if you truly believe that there’s room for more than just Tesla (NASDAQ:TSLA) in the U.S. electric car market.
Tesla stock wasn’t always expensive, and every company has to start somewhere. Penetrating the American market won’t be easy, but Kandi stock could be a multi-bagger like TSLA and NIO if Kandi’s ambitious vision comes to fruition.
A Closer Look at KNDI Stock
The history of Kandi stock is rife with surges and disappointments. While the shares cost less than $1 in early 2009, the bulls managed to push the price above $17 in the summer of 2014.
Evidently that was too much, too quickly as the KNDI share price then proceeded to plummet. In late 2015, nimble traders could have picked up Kandi stock shares at $5 and change.
After that, the stock price wobbled and flopped around for several years. Fast-forward to 2020, when KNDI shares traded in a range between $2 and $5 for half a year. Then came July, a time when traders were practically climbing over themselves to buy any available electric vehicle stock.
Amid this buying frenzy, TSLA stock seemed to pull NIO and KNDI up with it. However, that doesn’t mean that the market has truly discovered Kandi and its value proposition to investors. If and when that happens, the KNDI share price could repeat its parabolic move from mid-2014.
Coming to America
Admittedly, it’s a gutsy move for Kandi to plant its proverbial flag in the United States. It will have to compete with Tesla in the electric vehicle market, and CEO Elon Musk isn’t known for going easy on his competition.
In order to compete against Tesla, Kandi will have to differentiate itself somehow. But how? InvestorPlace contributor Luke Lango observes that one of Kandi’s unique qualities is its focus on swap-able batteries:
“Why? Because the battery-swap model is cheaper. Consumers don’t own their batteries. They rent the batteries. By removing the cost of battery ownership, the battery-swap model significantly lowers retail prices of EVs…”
The practice of swapping batteries is well known in China but not in the U.S. If America adopts this potentially cost-saving practice, Kandi could be viewed by electric vehicle enthusiasts as an early leader and innovator.
Keeping It Cheap
For Americans seeking affordability in their electric vehicles, there’s more good news from Kandi. In a virtual event scheduled to take place on a Aug. 18, Kandi plans to launch two of its highly affordable car models.
How affordable? The ultra-simple K27 will start at just $19,999 while the fancier K23 is expected to start at $29,999. At these prices, it’s evident that Kandi’s American vehicles aren’t meant to compete with Tesla’s offerings.
And that’s perfectly okay. Why should every electric vehicle be an eye-catcher? Kandi’s cars are cute, efficient and ideal for the budget-conscious. During a pandemic, when affordability is a major factor, Kandi’s vehicles look like a great choice.
The Bottom Line
If you’re just discovering Kandi stock now, you’re not the only one. There’s risk involved, to be sure, but the share price could explode as Kandi’s little cars could make a big splash in America.
As of this writing, David Moadel did not hold a position in any of the aforementioned securities.