The registration of electric vehicles is actively moving forward, especially in European countries, driven by Germany, Great Britain and France. In 2020, sales of electric vehicles in the German market had a share of 16% of the total market.
However, strict regulations for manufacturers in this niche affects the varying degrees of commitment to this production.The manufacturer must comply with the established CO₂ emission limits, otherwise he faces high fines.The second way is the purchase of expensive CO₂ certificates to compensate.
The famous but relatively young Tesla has some competitors among the old Volvo AB ADR (OTC: VLVLY) – 50%, Faw Car Co Ltd (SZ: 000800) – 40% and SAIC Motor Corp Ltd (SS: 600104) – 30%, which have set their immediate goal for 2025 to increase the share of electric cars in total sales.
However, regardless of who wins the battle, the transformation of the automobile industry is snowballing into production-related areas.
The basic material for the batteries for each electric car is lithium. The electric motor itself requires a lot of copper, and the connection between the technical components is impossible without semiconductors.
Then of course there is the electricity and the charging stations, which have to be available everywhere. One example is the company Enbw (DE: EBKG) in Germany, which has opened a fast charging station where 52 cars can be charged.
There should be a lot of such stations, so that buyers are not guided by the battery range when buying an electric car.
NIO
Because of investor concerns about competition and slower growth than new companies.
The company’s stock is down 27% in 2022, and 58% in the past 12 months. But revenues are growing well, with sales up 110% in 2021, despite supply chain difficulties from pandemic restrictions and manufacturing upgrades.
Also the company’s own investments in innovation and technology to remain competitive in a tough market. Although this is a limiting factor for the company’s stock, in the long term, these investments are expected to bear fruit.
The company has an interesting business model: “battery as a service”, the batteries of electric cars can be replaced without waiting for charging.
Another option is the possibility to subscribe to a battery separately.
NIO company believes the goal is to enter the international market, in particular the U.S. market, where the opportunity to attract investment is much higher.
At this point, Nio expects to ship 23,000 to 25,000 vehicles in the second quarter, and revenues in the second quarter to increase from 9.3 billion to 10.1 billion yuan.
Nio will start producing high-voltage batteries in the second half of 2024, according to CEO William Li.
The company also plans to produce 800-volt lithium-ion batteries with faster rechargeability in the same time frame in the second half of 2024.
At the moment, the obstacles to the company’s development are great, given inflation, but the promising nature of this branch of production suggests that the company’s shares will be in demand in the long term.
Rivian Automotive (RIVN)
In 2021, the market capitalization of the company exceeded 250 billion dollars, and the shares rose significantly, but not for long, not holding positions after the listing, and lost 60% of its price.
However, the company has great prospects in the field of electric transport . Experts predict an increase in revenues this year, as evidenced by the large number of pre-orders, which increased from 48.5 thousand to 71 thousand cars, as well as about 100 thousand electric trucks.
Like its competitors, the company is facing the same difficulties in the form of supply chain disruptions and the need to expand production, which requires an injection of capital, due to the situation in the world market.
Furthermore, it is not yet clear how the company’s new vehicles will perform in terms of operation, durability and customer comfort.
As for the trucks, the Rivian was named by MotorTrend as the Car of the Year 2022.
In Q1, the company recorded a significant loss of $1.23 billion for the first nine months of 2021, with earnings per share of $12.31.
However, despite the temporary difficulties, and the lack of profits, experts praise Rivian’s prospects. In particular, George Soros commented on Rivian’s prospects in a positive way.
At the moment, shares are trading at $27.32, having risen 1.9% in the last 24 hours.
The company has a market capitalization of $24.147 billion.
Li AUTO
For this company, analysts see growth potential of 47%.
The analysts’ average target price is $44.40 per share.
In 2020, the company’s SUV Li One became one of the top 10 best-selling cars in China.
Last month’s vehicle deliveries also surprised customers and investors, with 13,485 vehicles delivered, a 190% increase over the same month in 2021. For the year, the company delivered 76,404 Li one cars.
Sales in the third quarter were higher than rivals Nio and Xpeng , and revenue was $1.2 billion , and exceeded revenue for the same period last year by 230% .
Next, the company plans to expand capacity and double its sales.The market capitalization of the company was 254.70 billion HKD.
The company will launch its second production model L9 in the third quarter, which will be a family SUV developed on the new EREV platform. The company also has “major R&D spending in order to create a comprehensive BEV and charging ecosystem that can maintain a range of over 400 km in just 10 minutes of charging.”
Shares of Li auto certainly look interesting in the eyes of all investors interested in the electric car industry.
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