{"id":951,"date":"2021-06-09T23:55:00","date_gmt":"2021-06-09T15:55:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=951"},"modified":"2024-12-15T16:31:39","modified_gmt":"2024-12-15T08:31:39","slug":"the-future-of-the-electric-vehicle-industry","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/","title":{"rendered":"The bright future of the electric vehicle industry"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Outlook_is_bright_but_difficult_to_make_a_profit\" >Outlook is bright, but difficult to make a profit<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Why_the_outlook_is_bright\" >Why the outlook is bright<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Timetable_to_ban_fuel_vehicles_has_been_determined\" >Timetable to ban fuel vehicles has been determined<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Worldwide_Government_policy_support_for_green_energy\" >Worldwide Government policy support for green energy<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#We_are_in_the_beginning_of_Warring_States_period\" >We are in the beginning of Warring States period<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Stock_price_of_EV_companies_have_risen_astonishingly\" >Stock price of EV companies have risen astonishingly<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Current_market_share_of_electric_vehicles\" >Current market share of electric vehicles<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Electric_vehicle_industry_supply_chain\" >Electric vehicle industry supply chain<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Outlook_is_bright_but_difficult_to_make_a_profit\"><\/span><strong>Outlook is bright, but difficult to make a profit<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>When discussing future investment trends with people a while ago, we inevitably discussed the popular topic of electric vehicles. The term used in mainland China is new energy vehicles. I think this term is relatively broad and is very appropriate in China. In 2020, new energy vehicles in mainland China accounted for 1.75% of the total, an annual increase of 30%, of which pure electric vehicles accounted for 80% of new energy vehicles. Because China&#8217;s new energy vehicles include not only electric vehicles, but also any other vehicles that are not internal combustion engine (traditional) vehicles, such as hydrogen energy vehicles and biofuel vehicles, which have been developed globally for many years and use non-fossil fuels.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_the_outlook_is_bright\"><\/span>Why the o<strong>utlook is bright<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Let me talk about my conclusion first &#8211; the overall prospect of the electric vehicle industry is bright, but whether it can make a lot of money is another matter. The reasons are as follows:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Timetable_to_ban_fuel_vehicles_has_been_determined\"><\/span><strong>Timetable to ban fuel vehicles has been determined<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"has-normal-font-size\">The time schedule for the ban on the sale of fuel vehicles and hybrid vehicles in major countries around the world is determined, as shown in the following table:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>Schedule<\/td><td>Countries<\/td><\/tr><tr><td>2024<\/td><td>Rome<\/td><\/tr><tr><td>2025<\/td><td>Nederland, Norway, Athens, Paris, Madrid, Mexico city<\/td><\/tr><tr><td>2027<\/td><td>Austria<\/td><\/tr><tr><td>2030<\/td><td>UK, Sweden, Ireland, Ice Land, Denmark, Brussels, India, Washington State, Hawaii, Tokyo, Israel, Slovenia, Germany (Passed by the House of Lords)<\/td><\/tr><tr><td>2032<\/td><td>Scotland<\/td><\/tr><tr><td>2035<\/td><td>EU, China, Japan, South Korea, Canada, California, New Jersey, Massachusetts, Thailand, Clumbia<\/td><\/tr><tr><td>2040<\/td><td>France, Span, Indonesia, Taiwan, New York City, San Francisco, Egypt, Sri Lanka<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Worldwide_Government_policy_support_for_green_energy\"><\/span><strong>Worldwide Government policy support for green energy<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>This includes subsidies for various related industries, subsidies for car purchases, tax reductions and exemptions for manufacturers, and carbon rights trading. These government regulatory policies have had a tremendous impact on the two major industries of automobiles and energy in the past few years. To give a few examples:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The pioneer of electric vehicles Tesla (ticker: TSLA) has been able to survive in a difficult environment in the past few years. The reason for the company\u2019s turnaround is the sale of carbon rights trading. Interested readers can refer to the instructions in Chapter 4 of my book &#8220;The Rules of Super Growth Stocks Investing&#8221;.<\/li>\n\n\n\n<li>The Netherlands ruled that Royal Dutch Shell (ticker: SHEL), a major oil company, must increase emissions reductions and reduce carbon emissions by 45% in 2030. Shell has begun to reduce oil production in recent years and will achieve net zero carbon emissions by 2050. Shell has already decided on the executive bonus based on the amount of carbon reduction. A similar situation has happened to the oil giant Exxon Mobil (ticker: XOM). The traditional oil giants have suffered a sharp decline in market value in the past few years, and they are facing an existential crisis. Delisted from the Dow Jones Index in 2020.<\/li>\n\n\n\n<li>Russia is a traditional oil producer, and oil is also their main source of foreign exchange income. In 2021, a new oil strategy has been drawn up: &#8220;Before the end of the oil age, sell everything that can be sold.&#8221;<\/li>\n<\/ul>\n\n\n\n<p class=\"has-medium-font-size\"><strong>Electric vehicles are more like electronic devices<\/strong><\/p>\n\n\n\n<p>For this reason, the barriers to entry for electric vehicles are lowered; this is especially beneficial for electronic supply chain companies in East Asian countries and existing technology manufacturers. Generally speaking, a car needs at least 40 kinds of chips; each pure electric car uses two times more semiconductors than a traditional gasoline car.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"We_are_in_the_beginning_of_Warring_States_period\"><\/span><strong>We are in the beginning of Warring States period<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Almost all traditional automakers have already formulated plans for active participation and mass production of electric vehicles: In 2018, Volkswagen (ticker: VWAGY), the world\u2019s largest automaker, stated that the last internal combustion engine car was set at the factory. <a href=\"https:\/\/shaping-mobility.volkswagen.com\/en\/stories\/this-is-our-accelerate-strategy-14828\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/shaping-mobility.volkswagen.com\/en\/stories\/this-is-our-accelerate-strategy-14828\" rel=\"noreferrer noopener\">In 2026. On March 5, 2021, it announced its Accelerate strategy<\/a>. It is estimated that by 2030, the company will complete 70% of the electric vehicle market share in Europe; in China and the United States, this figure is 50%. As soon as this news came out, the company&#8217;s stock price rose sharply for two days.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Stock_price_of_EV_companies_have_risen_astonishingly\"><\/span><strong>Stock price of EV companies have risen astonishingly<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I mentioned in the first chapter of the book &#8220;The Rules of Super Growth Stocks Investing&#8221;: Take 2020 as an example, the share prices of Tesla and Chinese electric car maker NIO Automobile (ticker: NIO) will be in January 2020. In the whole year, they rose by 743% and 1,112% respectively, which is quite alarming (see Figure 1 below for details).<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"747\" height=\"230\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-14.png\" alt=\"\" class=\"wp-image-960\" srcset=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-14.png 747w, https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-14-300x92.png 300w\" sizes=\"auto, (max-width: 709px) 85vw, (max-width: 909px) 67vw, (max-width: 984px) 61vw, (max-width: 1362px) 45vw, 600px\" \/><\/figure>\n\n\n\n<p>Figure are from Yahoo Finance<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Current_market_share_of_electric_vehicles\"><\/span><strong>Current market share of electric vehicles<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Wood Mackenzie said that global sales of electric vehicles in 2020 will grow by 38%. Marklines estimates that approximately 28,000 electric vehicles will be shipped worldwide. Investment bank Wedbush estimates that electric vehicle sales account for 3% of the total global car sales. China officially announced that the sales of new energy vehicles will reach 1.3 million in 2020, an annual increase of 8%.<\/p>\n\n\n\n<p>The following table shows the domestic and global automobile market share of electric vehicles in major countries in the world in 2020:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>2020<\/td><td>EV market share in the country<\/td><td> EV market share in the world<\/td><\/tr><tr><td>China<\/td><td>1.75%<\/td><td>New energy vehicle production and sales volume ranked first in the world for 6 consecutive years<br>China Automobile Association: In the next five years, the average annual growth rate of new energy vehicle sales in mainland China will be more than 40%. 2021 sales will increase to 2.4 million<\/td><\/tr><tr><td>U.S.<\/td><td>1.8%<\/td><td>345,285 units of EV shipped<\/td><\/tr><tr><td>Norway<\/td><td>54%<\/td><td>&#8211;<\/td><\/tr><tr><td>Germany<\/td><td>&#8211;<\/td><td>The 3rd largest EV market in the world<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>According to ICCT&#8217;s statistics, the United States accounts for 18% of the total global electric vehicle production from 2010 to 2020, mainland China 44%, and Europe 25%. Bloomberg New Energy Finance (BNEF) predicts that by 2040, global sales of new electric vehicles will be 60 million, which will surpass traditional gasoline and diesel new vehicles; this forecast is consistent with the IEA. According to all the discussions in this article, the future of the electric vehicle industry is undoubtedly bright.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"139\" height=\"113\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/09\/ev-1600x1200-1.jpg\" alt=\"electric vehicle\" class=\"wp-image-14170\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Electric_vehicle_industry_supply_chain\"><\/span>Electric vehicle industry supply chain<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For the detailed industry chain of electric vehicles, I suggest you refer to my other blog article &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/26\/how-to-screen-potential-qualifiers-for-electric-vehicles\/\" target=\"_blank\" rel=\"noreferrer noopener\">How to screen potential qualifiers for electric vehicles?<\/a> &#8220;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/10\/15\/how-does-tesla-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Tesla make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/03\/07\/byd\/\">How does BYD make money? Why it beat Tesla? Sweeping the global EV market<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/09\/the-future-of-the-electric-vehicle-industry\/\" target=\"_blank\" rel=\"noreferrer noopener\">The bright future of the electric vehicle industry<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/15\/tesla-lost-advantages\/\" target=\"_blank\" rel=\"noreferrer noopener\">Tesla has lost edge in China<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/14\/the-future-electric-car-giant-volkswagen\/\" target=\"_blank\" rel=\"noreferrer noopener\">The future electric vehicle giant Volkswagen<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/26\/screen-electric-vehicles\/\" target=\"_blank\" rel=\"noreferrer noopener\">How to screen potential qualifiers for electric vehicles?<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>The future of the electric vehicle industry<\/p>\n","protected":false},"author":1,"featured_media":14170,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[129,29,28],"tags":[298,695,100,300,297],"class_list":["post-951","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ev","category-china-stock-market","category-us-stock-market","tag-nio","tag-shel","tag-tsla","tag-vwagy","tag-xom"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/951","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=951"}],"version-history":[{"count":32,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/951\/revisions"}],"predecessor-version":[{"id":32118,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/951\/revisions\/32118"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/14170"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=951"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}