Investing in EU Electric Cars
New Law Bans Cars That Are NOT Electric
It’s enough to make a libertarian squirm.
Actually, it’s enough to make any free-market advocate scream at the top of his lungs.
But none of that matters to Germany’s Bundesrat, which just passed a resolution to ban the sale of internal combustion vehicles.
Yes, you read that correctly: a complete ban on the sale of internal combustion vehicles.
The ban wouldn’t go into effect until 2030, but folks, that’s not that far off.
And as analyst Bertel Schmitt from Forbes pointed out, this goes far beyond Germany...
Germany’s Bundesrat is a legislative body representing the 16 states of Germany. On its own, the resolution has no legislative effect. EU-type approval is regulated on the EU level. However, German regulations traditionally have shaped EU and UNECE regulations.
Say what you want about “unity” amongst EU nations, but everybody knows that without Germany, the EU is sunk. Germany has the economic muscle to influence everything that happens in the EU, and everyone knows it.
So when Germany says it’s banning the sale of internal combustion vehicles, rest assured, the EU is banning the sale of internal combustion vehicles.
Expediting the Inevitable
While I may not be the kind of guy who likes the idea of the government banning the type of car you can drive, I am the kind of guy who knows an opportunity when he sees it.
Quite frankly, I couldn't care less if the EU bans the sales of internal combustion vehicles. Internal combustion vehicles are on death’s door, anyway. In another 10 years, nearly every new passenger vehicle in EU showrooms will be electric.
This is just going to expedite the inevitable. And if you’re smart, you’ll take full advantage of this situation.
You see, in 2015, new vehicle registrations in the EU hit 12.6 million.
By 2030, that number will likely be considerably less, thanks to the growth in car-sharing services, an increase in more walkable and bikeable communities, and an expansion of more efficient public transportation. These alternatives to car ownership could end up snatching as much as 30% of the passenger vehicle market in the EU.
That being said, that still leaves about 8.8 million new passenger vehicle sales in 2030. With all of those being electric (because hydrogen fuel cell adoption will still be a myth in 2030), that’s a very big deal. And it doesn’t stop with the EU.
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18 Million Electric Cars
According to a report from the Argonne National Laboratory, by 2030, electric cars will make up 58% of the light vehicle market in the U.S.
In 2015, U.S. consumers bought 17.5 million cars and light trucks. Even if the U.S. market doesn’t ever grow again and instead stays static at 17.5 million, we’re looking at more than 10 million cars being electrified by 2030.
So just with the EU and U.S. combined, by 2030, the market for electric cars could exceed 18 million cars. That’s going to require a lot of lithium-ion batteries and a lot of lithium. Do you have any idea what that’ll do to the price of lithium along the way?
I’m not saying lithium-ion batteries are going to be the batteries of choice in 2030, but they’re a lock for at least the next 10 to 15 years. My friend, only a fool would not have some exposure to the lithium space right now.
Certainly I have skin in the lithium game, and I strongly recommend you do the same, either through public markets by buying some of these stocks or through private deals, which are typically only available to accredited investors. If you are an accredited investor, here’s a group you can join that will allow you access to all kinds of private deals, including a few in the electric vehicle space.
Bottom line: Electric vehicles are absolutely, 100% the future of the automobile industry. And the time to strike is now.
To a new way of life and a new generation of wealth...
@JeffSiegel on Twitter
Jeff is the founder and managing editor of Green Chip Stocks, a private investment community that capitalizes on opportunities in alternative energy, organic food markets, legal cannabis, and socially-responsible investing. He has been a featured guest on Fox, CNBC, and Bloomberg Asia, and is the author of the best-selling book, Investing in Renewable Energy: Making Money on Green Chip Stocks. For more on Jeff, go to his editor's page.
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