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Electric vehicle stocks: Buy, sell or shift to neutral?

Electric cars charging at a charging station. 3d rendering

Дмитрий Ларичев/iStock via Getty Images

The electric vehicle sector starts the second half of the year in need of a hard reboot after the Green Tidal Wave thesis hit potholes this year that included supply chain disruption, commodity price shocks, chip

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TexasJack1 profile picture
So far they can't complete with a paid off Ford F250 with a tow package. I doubt they ever will. At least in my lifetime. I have seen some comparable tests with the Ford Lightening pickup and GMC Denali pickup pull a travel trailer. The Ford is looking every 100 miles or even less for a EV charging station and takes over an hour to recharge. So I know I can motor on for more that 300 miles before needing to look for filling station.
Thumper2 profile picture
Way too much short term thinking around here for an investment website. Tesla’s small dip in production was ONLY due to a forced Covid shut down for several weeks in China. They have put in place all the elements for market domination: demand, supply chain (going all the way back to chemicals for batteries), factories, charging network. Short sightedness by the market in the face of the coming Tesla dominance is exactly the ideal time to buy. Remember also Tesla is not just a pure EV play. They already have high quality grid storage/balancing batteries and software that will be dominant in grid markets as Tesla battery production grows and grows. Tesla semi will sell like hotcakes when cell production scales to support it and robots I remains a wildcard but hugely profitable possibility. Buy Tesla now for long term growth.
OverTheHorizon profile picture
Who can afford one—even at $5 gas?

there were dozens of automobile manufacturers back in the 1910's/20's when ICE powered vehicles began to get popular. Most all of them went bankrupt. I expect to see the same for the EV companies.
Legacy Legends, LLC profile picture

Dupont was one of them.
The federal government will screw up the EV sector as well. Without chips, ant other components, a weak electric grid, and the green new deal, who will be able to buy an EV?
The federal governments lacks a strategic plan, and tries to “control” too much. Ideology/polices will bankrupt many business within the year, if they wait for federal support for their business.
Too many challenges for everyone, and we have too much negative comments from parties.
Let’s regroup and refocus on the needs of our economy, tell the American people we tried to transition too fast, and will open up the natural gas pipelines, and relax the gas production, for the safety of the US and our Allies.

Since Europe is preparing for the winter season, they need our support and products. I would rather see US dollars spent on our products, instead of Saudia Arabia, Russia, Venezuela, and others, and lower the cost of Brent crude, to stabilize the global economies, and assure Europe, we have your back. We must control our own destiny until we can transition over time to new renewable energy, keep inflation in tact, allow family’s businesses, to regain confidence in DC.

Just a rational adult who has lived through before during the NIXON/CARTER era. We do not need gas rationing, food shortages, high crime, runaway inflation, skilled worker shortages, and price controls. We are one of the greatest countries in the world, but act and operate like a country following others leadership. It’s time to take the “Bull by the Horns” and solve our problems first, and stop blaming others for our lack of LEADERSHIP in DC.
@Thespiceman3280: Ignoring AGW isn't rational, though the far right science denial crowd loves it.
ErikWilson profile picture
@Thespiceman3280 you have merely identified the known defects...yipee!
how about some remedies
" The electric vehicle stocks with the highest Seeking Alpha Quant Ratings are Li Auto (LI) 3.41, Tesla (TSLA) 3.32, Lucid Group 3.01, Ayro (AYRO) 3.00, and XPeng (XPEV) 2.95. "

Quite appropriate, Li has great products, will continue to grow rapidly.
Dale Roberts profile picture
A chicken in every pot and an Electric Vehicle in every driveway. - (Dale Roberts)
Dale Roberts profile picture
Apparently it is very difficult to buy an EV in 2022. But you can order one. And wait. Can the planet wait?
Dale Roberts profile picture
All said, happy to play the 'green' commodities supercycle. And happy to own $BATT

Don't fight the policy, as an investor.

And more 'happy' to be profiting handsomely from traditional oil and gas stocks.
@Dale Roberts Yes if you are fortunate enough to own a driveway..
Too many investors must be watching too much CNBC ....?

Most of those Money Manager's appearing on CNBC, keep talking about a bottom, or peak Inflation, or peak Bearishness ....?

The Fed will slow the US economy and attack 40 year high Inflation, as FED rate hikes and QT will continue for months to come....!

TSLA just missed their delivery metrics and the stock will SELLOFF on the next trading day....!

Stay in CASH, so you have dry powder to invest in the future...... ; )
@Maverick 2021 bad news is good news?
No mention of the second best ev maker fisker
$50,000-plus EVs are not going to be popular in a high inflation recession. Strong sell on all the unprofitable tech companies trying to make battery-powered cars.

Some of the big automakers have new EVs, plug-in hybrids and hybrids priced in the high $20s to $30s. That is what will sell. You don't need a garage with a home charger for the hybrids, although you can go up to 30-40 miles on electric power alone with the plug-ins

"You don't need a garage with a home charger for the hybrids, although you can go up to 30-40 miles on electric power alone with the plug-ins "

A lot more than 30 to 40 miles. Li One has 81miles pure ev range
Li L9 about 110miles pure ev range. 683 miles combined range. Best of both worlds.
Thoughts on Enovix, Fisker, Chargepoint and Volta
Strong sell.
Zeusy Zeus profile picture
With a product as good as Rivians people saying they’re going belly up must be joking. Supply chain issues are bad for everyone right now and they have plenty of cash to weather the storm until it gets better. This company will be a behemoth one day mark my words. Save this post 😎
ckarabin profile picture
@Zeusy Zeus That too will put a lot of competitive pressure on other players in the business. Every car that RIvian sells means one fewer car sold by someone else.
dmce profile picture
@ckarabin - Every car that RIvian sells means one fewer ICE car sold by someone else.

David Hendry profile picture
@Zeusy Zeus The R1T is a well engineered truck and being first out the door is always a good thing. Whether they make sales inroads remains to be seen. A short bed truck for $70k seems a tough sell to me. We will find out soon enough.
Comparing you tube vids between Tesla and Rivian assembly lines is striking. Lots of humans in the Rivian vid... not sure if that is a good thing when it comes to production costs.
Automotive history tells us that avoiding bankruptcy is damn near impossible for USA auto makers. That is not a joke, just a fact.
ckarabin profile picture
Just because it is a growing industry does not mean it justifies ANY valuation. Tesla will do fabulously well, but that $1200 that you could have got for the stock 7 months ago may be the best you get for it for quite some time.
Zeusy Zeus profile picture
Tesla has dropped significantly this year as well why not list that? As well as Lucid… sometimes I don’t know what to think about these articles they seem a little skewed toward one direction. Seems like author is trying to sell people on Tesla imo.
David Hendry profile picture
The Chinese EV companies are going to take plenty of market share in the US, not unlike what Toyota Honda Nissan did in the seventies. F & GM need to step their game up in order to survive. The little start ups get crushed.
I give Aptera a chance of surviving as they may be able to create a sizable niche market in the sun belt. Current fuel costs will make an odd looking 3 wheeler more attractive and up to 40 miles of free fuel a day certainly helps. They have not gone public yet but an IPO will be coming soon. https://aptera.us
@David Hendry The Chinese have taken and are going to take NONE of US market share.
@User 28897925 Really? Keep an eye on PSNY, for one.
David Hendry profile picture
@User 28897925 Back in the seventies many Detroit auto executives espoused the same sentiment as you. No one will want an inexpensive well made fuel efficient little Japanese vehicle. GM had 50% market share at the time.
Legacy Legends, LLC profile picture
Tesla reported second quarter delivery numbers! Tesla delivered 254,695 vehicles and produced over 258,000 vehicles!
@Legacy Legends, LLC Growth company.....LOL
Zeusy Zeus profile picture
@Legacy Legends, LLC Where? I don’t see that anywhere. I’ve been nervous about Tesla because of all the layoffs they are making and supply chain disruptions. I think they miss earnings.
Legacy Legends, LLC profile picture
@Zeusy Zeus

CNBC reported first. It wouldn't surprise me if they miss earnings, BTC down also. Ive been waiting for a big opportunity to add!
None of the little companies will survive. They are all gambling on being bought out by a large existing manufacturer.

Anyone who observed the travails of Tesla, the first all-new US manufacturer in decades, building out its supply chain, manufacturing base, and dealer outlet system, knows this.

A lot of folks entering the EV business are gambling on getting a piece of the Biden infrastructure bill goodies, and they won't. Not just because of the Biden ideological bent towards unions which don't exist among them, but because they will never be able to achieve volume because supply chains are both broken and non-existent. gonna need some deep contacts to source enough batteries to be relevant, at a cost that is reasonable, in a supply constrained market.

Tesla and Ford have been aggressively making moves to defend their supply chains and they can - because of volume and competence. These smaller companies with significantly lower volume will incur significantly higher costs and margin pressure.

Companies like Ford and Tesla with robust supply chain contract and expansive real world presence and deeps pockets can also manage margin pressure - even negative margin - better than startups.

I think VW trying to proclaim its relevance in the EV space is hilarious considering that up to a couple of years ago it declined to have anything to do with EVs because of its 'superior' ICE technology. VW is going to have issues with obtaining energy for its manufacturing, battery packs, and credibility to boot. It is so far behind the ball all it has is its marketing campaign.

The clearest story of the irrelevance of the bit players in the EV space was Ford's dropping of Rivian. Rivian's product is very nice. Yet Ford realized it could do just fine on its own. In my opinion, Rivian will struggle being relevant now, while if it had maintained its relationship with Ford it could have been a contender.

I'm gonna be watching the news expecting to see lots of the small EV players go belly up when the Biden Infrastructure bill fails to deliver on creating the Brave New EV World they sold it as, when these companies fail to secure supplies of semiconductors and batteries as the Biden infrastructure bill failed to address these bottlenecks and is blocking domestic production, and when retail simply avoids buying vehicles from companies without dealerships/retail presence in their neighborhoods out of fear they cannot obtain support and maintenance.

Tesla and Ford will likely encounter margin pressure in the meantime, but will most assuredly exit this chapter stronger than pretty much everyone else. Yes, including VW and the rest of the Germans which are way behind the curve and encountering domestic issues unique to the leadership of that country.
@kmi I agree . However Ford needs to work on quality control , they have way to many recalls. I like the ceo and his vision but it just seems like every week in reading about a major Ford recall.

As far as the start ups there is one I think that makes it and that’s Fisker . I believe they do because they are taking a asset light approach of outsourcing their manufacturing to magna and Foxconn . The Ceo has been a successful designer for many years and has designed many very highly desirable vehicles . It’s really a formula for success the pros make it and he designs it.

I am not sure Fisker makes it to significant volume they've already been at it for a while but I still like Magna $MGA even as it has pulled back
@kmi: Same for Lucid. Talk about a cash furnace...
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