Nothing in Life Is Guaranteed … But the EV Trend Sticking Around Is Pretty Close

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Nothing in life is guaranteed.

An electric vehicle is hooked up to a charging cable.
Source: Shutterstock

I know, I know … except death and taxes.

My fellow Pennsylvanian, Benjamin Franklin, was right about that. But those topics are no fun to talk about.

The dictionary defines a guarantee as a “promise or assurance.” And you know as well as I do … there are no guarantees when it comes to investing.

But here’s the key that so many people overlook in the day-to-day price swings…

There are certain trends that are as close to a certainty as you can get that we could practically speak of them as guarantees.

These are the trends you want to invest in.

I shared my latest research in the new issue of Investment Opportunities that was just released. And with this being as close to a guarantee as possible, I want to share a little bit of it with you as well…

One all-but-certain trend getting a lot of attention right now is electric vehicles (EVs).

Is the growth of EVs guaranteed? I suppose not literally. But I cannot even begin to fathom a world that does not have a lot more EVs in the next five to 10 years and beyond.

EVs are better for the environment, and they are about to become cheaper than gasoline- and diesel-powered vehicles. We can see the tipping point.

So regardless of recessions, bear markets, changes in political leadership, pandemics or any other unexpected curveball, I am as certain as can be that there will be more EVs on the road in the future.

In 2020, 4.4% of all new vehicles sold around the world were electric. According to Statista, 80% of new vehicles will be electric by 2050. I realize that sounds like a long way away, but those years in between are our opportunity. The path from 4.4% of global sales to 80% will shift trillions of dollars from ICE vehicles to EVs.

Plus, many of the major auto manufacturers have aggressive EV plans — which are getting more aggressive all the time — so sales could hit 80% well before 2050.

If you want to see for yourself, take a moment to look at a list recently published by Car and Driver of EVs expected to hit the market in the next five years. You can find it here. I count 45 of all shapes and sizes.

Car and Driver also published a list of electric vehicle models currently for sale in the United States. There are 19. The technology has advanced enough that I expect most of those 45 EVs in development will make it into production, so odds are high there will be at least twice as many EV models available in the next five years.

Quite a few analysts believe the traditional automakers will not be able to avoid major disruption as EVs become the norm. Not every manufacturer thriving today will thrive in the next decade, but don’t count all the big boys out just yet. Some household names will grow market share and sales and come out near the top.

Volkswagen (OTCMKTS:VWAGY) is one of the most committed to EVs through both its fleet of vehicles as well as battery technology. The company plans to build six battery factories in Europe, with the first one completed by 2023 and the last by the end of the decade. And it plans to produce one million EVs per year … by 2023.

See what I mean by aggressive?

By 2030, the largest auto manufacturer in the world (in terms of revenue) believes half of its sales in North America will be from EVs.

General Motors (NYSE:GM) hopes to introduce up to 30 EVs by 2025 and is investing $27 billion into the new lineup of cars. By that same year, the company expects to sell one million EVs in North America and China. For perspective, that would be nearly 3X more than total Tesla (NASDAQ:TSLA) deliveries in 2019.

Ford (NYSE:F) recently introduced the all-electric Mustang Mach-E crossover and an all-electric version of its popular F150 pickup truck. The company also plans to roll out an electric version of its popular transit van. By 2030, Ford expects 40% of sales to be from EVs, and to get there, it plans to spend up to $20 billion.

With trillions of dollars up for grabs, newer players are also attempting to disrupt this industry. At least 13 have gone public in the last year via the SPAC (special purpose acquisition company) boom. Not every company will succeed, but a few will … and they could be among the biggest winners in the EV trend during the Roaring 2020s. I am doing my deep dive, boots-on-the-ground research now.

Outside of the U.S. and Europe, China dominates EVs. It is already the largest EV market in the world, with nearly half of all sales coming from that country. I expect it to remain a massive market thanks to backing from the Chinese government, a wide-open industry without any one dominant player, and a population more open to electric-powered vehicles.

The largest Chinese EV automaker is BYD Company (OTCMKTS:BYDDF) — currently valued at $77 billion. It is as much a legacy in China as any auto manufacturer there, having been around since 2003. Believe it or not, Warren Buffett invested nearly a quarter billion dollars in the company in 2008.

You have probably heard all the buzz about NIO Inc. (NYSE:NIO). It’s the most well-known upstart Chinese EV company to American investors. The company sold 43,728 EVs in 2020, but with the ongoing semiconductor shortage, production will likely be disrupted at least in the early part of this year.

However, just this week NIO said its May EV sales nearly doubled over last year — up 95.3%. All told, it sold 6,711 vehicles. So it could still deliver well above 70,000 EVs for the year, if not much more.

Two new EV players in China that trade on major U.S. stock exchanges are Li Auto (NASDAQ:LI) and Xpeng (NYSE:XPEV).

Over the past decade, electric vehicle technology has advanced by leaps and bounds, and companies like those we just talked about are all in. Newer batteries, especially solid state batteries, are lighter, last longer, charge faster and are safer than lithium-ion batteries that are currently used.

Electric vehicles also have governments on their side. Thanks to environmental concerns, governments in China and Europe are moving to phase out internal combustion engines and phase in EVs.

Add it all up and we’re talking about an epic boom coming in EV sales.

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. 

Matthew McCall left Wall Street to actually help investors — by getting them into the world’s biggest, most revolutionary trends BEFORE anyone else. Click here to see what Matt has up his sleeve now.


Article printed from InvestorPlace Media, https://investorplace.com/moneywire/2021/06/nothing-in-life-is-guaranteed-but-the-ev-trend-sticking-around-is-pretty-close/.

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