Electric vehicles are benefiting from the green energy boom and investors have focused primarily on China, which today accounts for 80% of the world’s battery production capacity. But how ready are “traditional” brands to follow the trend?
It is estimated that by 2030, 30% of all cars sold in the world will be electric vehicles, up from just 3% in 2020. Automakers are announcing substantial increases in their long-term EV portfolios and surely in the future, this type of vehicle will achieve 100% of the industry’s sales
This year on the streets of Montevideo, Tesla cars began to circulate among other brands. A leading company in electric cars and very well positioned internationally to take advantage of the rapid growth of the sector, although still little known by Uruguayans. If you doubt the competition will be strong, as shown by the plans for the transition to the electric world of traditional brands:
1. BMW (BMW, Mini y Rolls-Royce)
The German group has 14 “electric” models, which accounted for 8% of its total sales volume last year. By 2025, BMW plans to have 25 such models, of which 12 will be electric vehicles and 13 will be hybrids (vehicles that run on both electricity and fuels). BMW has set a goal for electric vehicles to represent 50% of its global sales volume by 2030.
2. Ford
After previously focusing on hybrid models, this American brand is now shifting its attention to electric vehicles and may be one of Tesla’s direct competitors. This year it announced the 2022 launch of the F-150 Lightning, a version of Ford’s more profitable vehicle platform. Even the Mustang model will have its electric version next year.
3. General Motors
This year, the American automaker said it plans to sell only zero-emission vehicles by 2035, and invest $ 35 billion over five years in the development of electric and autonomous vehicles. By the end of 2025 it plans to launch 30 models of electric vehicles, with a goal of 1 million sales per year. In turn, the company is selling its proprietary battery technology to other car companies like Honda.
4. Volkswagen
3% of the German automaker’s 2020 sales came from electric vehicles. Volkswagen will spend € 46 billion over the next five years to “electrify” its vehicle portfolio and expects to sell 1.5 million cars per year starting in 2023.
5. Others
Mercedez Benz, Audi, Porsche and Volvo are also in the race to lead this market and profit from its sales potential.
How to invest in “the transition”
This massive growth undoubtedly creates potential investment opportunities throughout the electric vehicle supply chain. From investments in infrastructure for charging stations to manufacturers of components, materials and semiconductors. Many of these companies are publicly traded and their shares are available on the market. Investing in companies aligned with sustainability policies (energy efficiency, clean transportation, etc.) is an increasingly present trend in investment decisions that seek environmentally friendly approaches.
An example of the way in which capital flows are incorporated into sectors that carry the banner of innovation for the coming years is, among others, the case of the Global X Autonomous & Electric Vehicles ETF. It is a publicly traded fund that provides exposure to the development of electric and autonomous vehicles, investing in companies that make up the value chain of this technology and that, through their diversification, seek to avoid incurring specific risks. Its performance during 2021 accumulates a 25% growth and in one year it doubled the value.
At GBU we have added to the functionality of electric vehicles, which we have incorporated to carry out procedures that require mobility. But the most remarkable thing about this “transition” that we are talking about is the increasingly important offer of financial instruments associated with green projects available in the market to invest.
Companies and Businesses
2021-08-11T21:09:00
2021-08-11T21:09:00
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