| You are receiving this email because you signed up to receive our free e-letter, or you purchased a product or service from its publisher, The Oxford Club. If you are having trouble viewing this email, click here to view it in your browser. |
| Brought to you by The Oxford Club | Saturday, September 3, 2016 |
Electric Vehicles Disrupt the Auto Sector
 For years I've written about the coming electric vehicle boom. I've been patiently waiting for it to reach disruption status.
Now it's almost there. And I know the best way for investors to play it.
My wife and I own a Tesla Motors (Nasdaq: TSLA) Model X. It is an engineering marvel. A 17-inch touch screen controls nearly every function and setting.
One of the benefits of EV ownership is an almost total lack of required maintenance. No oil changes, no rotting mufflers and tailpipes, no timing belts, etc.
If you think you'll sacrifice performance if you switch to an EV, think again. Most EVs can easily out-accelerate their internal combustion engine (ICE) counterparts.
Another common concern is EV pricing. But according to Bloomberg, EVs will cost the same as ICE vehicles by 2022.
And by 2040, EVs will account for 35% of new vehicle sales.
The EV Tipping Point: Unlocking Demand
Like most new leaps in technology, the move to EVs starts out slow - with early adopters like my wife and me. Our first EV was a Nissan Leaf.
In three years of owning it, all we bought for it was two front tires and wiper blades. There was absolutely nothing else required for the car.
Its only fault was its limited 80- to 90-mile range.
Our Tesla Model X has a 270-mile range, and Tesla recently announced the availability of a 100-kilowatt-hour battery that boasts a 315-mile range.
Continually improving battery technology is quickly eliminating range anxiety. By this time next year, Tesla's Model 3 will be available. It boasts a 200-plus-mile range and a price tag of $35,000.
But Tesla will have a number of big competitors next year, too. | | The Last Great Source of Income...
Dividends are just about the last source of investment income left in America.
And in 2016, many companies are slashing their payments. We've already seen cuts ranging from 25% all the way to 76% on companies including CenturyLink, Wynn Resorts and Marathon Oil. Click here to learn more. | | |
General Motors Company (NYSE: GM) has two EVs that compete with the Model 3. Both the plug-in hybrid Volt and the all-electric Bolt are available at dealerships right now.
They too are in the $30,000 to $40,000 price range. And nearly every other major car manufacturer has one or more EVs coming out in the next 12 months.
Once EVs are the same price as comparably equipped ICE vehicles, EV sales will hit the launch pad.
Who wants all the extra hassle and maintenance that comes with ICE autos?
And it's particularly gratifying to breeze by gas stations. I calculated that my wife saves a day and a half per year by not having to stop and fill up on gas.
Cashing In on the EV Boom
As an investor, you might be inclined to buy a few shares of Tesla and sit on them for the next several years. Chances are, Elon Musk's pioneering efforts will richly reward you.
But there's bound to be a lot of volatility between now and then. I have a better idea.
It's not another car company making EVs.
You see, the one thing every EV needs is a big battery pack. And right now, the battery chemistry of choice is lithium-ion.
Before EVs, lithium's primary uses were grease additives and medicine. However, the coming demand for lithium to support the EV boom is going to dwarf the combined demand of all other lithium uses.
The current annual demand for lithium is 160,000 metric tons. By 2025 or sooner, demand will triple to 470,000 metric tons.
But the lithium story gets even better. New battery units are emerging to store electricity.
Homeowners can store solar power for evening use. Utilities can store power to even out the demand coming from their customers.
It all means the lithium supercycle is about to get underway. Elon Musk has stated, "In order to produce a half-million cars per year... we would basically need to absorb the entire world's lithium-ion production."
Musk's Gigafactory in Nevada has already started producing lithium-ion batteries. When it's finally completed, it will make more lithium-ion cells than all other manufacturers put together.
I've written about lithium suppliers a lot lately. Any one of them would make a great addition to your energy portfolio.
However, if ETFs are more to your liking, you might want to consider the Global X Lithium ETF (NYSE: LIT). Over the last year, this ETF has gone up more than 37%.
Given the coming demand for lithium, this fund could easily turn into a five- or 10-bagger over the next few years. Resource Strategist Sean Brodrick agrees.
Now's a great time to back up the truck and buy.
Good investing,
Dave Will You Buy Any "Big-Ticket Items" in 2016?
A new car... big vacation... engagement ring... fishing boat... college tuition payments... repairs to your home?
If so, the government may owe you money.
A new law signed at the end of 2015 offers "cash rebates" to 119 million eligible Americans for purchases made in 2016.
This is a chance to collect anywhere from $1,230 up to $12,900 and perhaps beyond.
But you must prepare now to maximize your payout. Details here. |
|
|
|
In less than a year's time, oil prices will skyrocket. It's all thanks to China's obsession with the automobile. Read On... |
|
|
This "new gasoline" will completely change the way we generate energy. And it preexists the dinosaurs. Read On... |
|
|
Gold and miners are on the launch pad. And certain global forces are about to send them skyward. Read On... |
|
|
|
The Oxford Club is a financial publisher that does not offer any personal financial advice or advocate the purchase or sale of any security or investment for any specific individual. Members should be aware that although our track record is highly rated by an independent analysis and has been legally reviewed, investment markets have inherent risks and there can be no guarantee of future profits. The stated returns may also include option trades. 
No comments:
Post a Comment
Keep a civil tongue.