The gap in the electric vehicle sector

International Energy Agency (IEA) data indicate that in Q75, global sales of electric cars increased by 18,5%, bringing the global fleet to 3,3 million. China dominates with 2,3 million cars sold last year, while 0,6 million were sold in Europe and just 2030 million in the US. Restrictions relate to charging infrastructure, trucks and rising prices of materials for the production of batteries. It is believed that with the current policy, by 200, the number of electric vehicles will increase tenfold (up to 30 million), an increase of up to XNUMX%. annually. In the long run, this is a big increase, especially in view of the recent weakness in the sector stocks.

About the author

Ben Laidler - global markets strategist in eToro. Capital investment manager with 25 years of experience in the financial industry, incl. at JP Morgan, UBS and Rothschild, including over 10 years as the # 1 investment strategist in the Institutional Investor Survey. Ben was the CEO of the independent research firm Tower Hudson in London and previously Global Equity Strategist, Global Head of Sector Research and Head of Americas Research at HSBC in New York. He is a graduate of LSE and Cambridge University, and a member of the Institute of Investment Management & Research (AIIMR).

Every 10th car sold is an electrician

Currently, electric vehicles account for about 10 percent of the total. car sales, but their share of the global installed base is below 2%, with many decades of strong growth ahead of them. The direction is set by Norway, where 86 percent. of new cars are electric cars. In turn, the United States, although tightened fuel standards and financed chargers, are lagging behind - by 2030, market penetration will be only 20 percent, even though Ford (F) and GM (GM) are aiming for 100 percent. selling electric vehicles. In Europe, market penetration is expected to reach 35 percent, and in China - 45 percent. (the control of ¾ world battery production contributes to this result).

As with renewable energy, EV shares have not fared very well this year, even despite strong growth prospects. This happened because rising bond yields were shaken by high valuations. The positive aspect is the more attractive valuations for long-term investors, where the price / earnings ratio Tesla (TSLA) it dropped to the level of approx. c50x, and for traditional, older cars - even to 3x (STLA.MI). Companies dealing with the supply chain for electric vehicles, such as companies extracting lithium, did much better.

Data, numbers and graphs are correct as of 02/06/2022. Source: IEA.