Norway isn’t usually on the list of America’s adversaries, but Will Ferrell sure got fired up over the idea it is beating the United States in one area.
General Motor’s (NYSE:GM) Super Bowl commercial called “No Way, Norway” ended up on most people’s “best of” lists. And yeah, I got a chuckle out of it, too.
The commercial begins with Ferrell enraged that Norway sells more electric vehicles (EVs) per capita than the United States … and he then goes on a crazy Will Ferrell-like adventure to go there and put a stop to the disturbing trend.
The point of the commercial isn’t that EVs are more popular in Norway — though that’s true. EVs have 54% of the market there.
No, the point is that GM believes EVs can be that popular here in the United States. That’s why the company is planning for and investing in it.
And it’s why you should be, too …
Every major automaker in the world is racing to get more and better electric vehicles on the market.
General Motors recently promised that it will have 30 EV models by the end of 2025. By that same point, 40% of all GM cars available in the U.S. are expected to be electric.
That requires resources, and the company boosted its investment in EVs and autonomous vehicles (AVs) to $27 billion.
We get a glimpse at a couple of those models in the commercial. Will Ferrell drives the Cadillac Lyriq, while Keenan Thompson and Awkwafina are shown briefly with the GMC Hummer EV.
Another GM commercial, a play on the old Edward Scissorhands movie, also shows the Lyriq, this time highlighting its hands-free AV technology.
So GM appears well is on its way to an all-electric future, and so does everybody else.
It’s the kind of hypergrowth trend I love. It has huge upside … is virtually unstoppable … and is at a tipping point.
In 2018, the average cost for an electric vehicle with a 250-mile range was $44,000, which is 83% more than the $24,000 price tag of a Toyota Camry. With that $20,000 difference, the vast majority of car buyers stay with a traditional gas-powered vehicle.
But in 2020, that price gap was expected to narrow to $9,000 as the average cost for an EV drops to $33,000. And within just two years, the average cost of a 250-mile range EV will fall to $24,000 — while the cost of the Toyota Camry rises to $25,000.
The first time an EV is cheaper than the average gas-powered vehicle will be a major milestone. The breakthrough will push a lot of prospective car buyers to at least strongly consider an EV… and that day is coming quickly.
By 2024, the cost will swing greatly in favor of EVs. ARK Investment Management predicts EV prices will drop to $17,000 while the Toyota Camry remains constant at $25,000.
At that point, it’s a no-brainer.
How is it that EVs continue to get cheaper?
A few years ago, the battery made up about 57% of an EV’s cost. In 2019, that percentage fell to 33%. And by 2025, it is projected to be just 20% of the cost of the vehicle.
Electric vehicles becoming increasingly more affordable is a big reason behind the eye-popping growth forecasts. The Energy Industry Administration calls for sales to more than triple to 6.5 million units by 2024.
ARK Invest is even more bullish, predicting that 37 million EVs will be sold in 2024. That would be an amazing 79% compound annual growth rate and result in full-year revenue of $1.1 trillion.
Even if we basically split the difference and EV sales increase to 20 million units in the next few years, it is an easy 10X opportunity for investors.
Breakthrough battery technology will power the electric vehicles of the future. This hypergrowth trend is well underway, but it’s still early. That means now is the time for smart investors to get in position for the biggest profits.
On the date of publication, Matthew McCall did not have (either directly or indirectly) any positions in the securities mentioned in this article.
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