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Created on 30.11.2021 | Updated on 07.12.2023

E-mobility takes off

Electric mobility has made the breakthrough. Every other new car in Switzerland is soon set to have an electric drive. This trend entails both risks and opportunities. Find out which investment opportunities could be attractive and what you need to bear in mind.

What do the Pope, former Federal Councillor Doris Leuthard and actor Leonardo DiCaprio all have in common? They all drive electric cars. The Pope is chauffeur-driven in his new Popemobile made by US car manufacturer Fisker, former Federal Councillor Leuthard has a Tesla in her garage and DiCaprio owns an entire fleet of vehicles powered by alternative energies.

The trend has now become mainstream. In Europe, the market share of e-cars already stands at over 10 percent. Last year, for the first time, more electric vehicles were registered in Europe than in China – which had been the biggest national e-mobility market up to that point. In Germany alone – Europe’s largest automotive market – there were just under 400,000 new registrations in 2020 – up three-fold on the previous year.

The e-mobility market is also taking off in Switzerland: federal government statistics reveal that over 43,000 e-vehicles in total were newly registered in 2020 compared with 28,000 in 2019. A study by Swiss eMobility indicates that every other newly registered car will have an electric drive in Switzerland by 2025.

Electric mobility and opportunities on the stock market

Investors looking to benefit from the e-mobility trend have a variety of investment options. In addition to car manufacturers, many other sectors are contributing to e-mobility growth. The beneficiaries include technology companies, suppliers and producers of raw materials. Here’s a brief summary:

Car manufacturers

For some time now, e-pioneer Tesla has no longer been the only provider of electric vehicles. Various other manufacturers are hot on its heels. In Switzerland, the Tesla Model 3 remains the top-selling e-car – but Volkswagen is rapidly gaining ground with its ID.3 e-model. Experts believe that VW will soon overtake its US rival in Switzerland – something which has already happened in Germany.

Here are the top 15 electric cars in Switzerland

The graphic shows the top-selling e-vehicles in Switzerland. In 1st place is the Tesla Model 3, in 2nd the Volkswagen ID.3 and in 3rd the Renault Zoe.

Technology and infrastructure experts

Technology firms – which supply key elements for the expansion of the infrastructure required – are also benefiting from the e-mobility trend. There is strong demand for technologies to provide public charging stations, affordable home chargers and improved power storage solutions.

The Swiss technology group ABB is at the forefront of developments: in September 2021 it announced plans to launch the world’s fastest charging station on the market by the end of the year. This can fully charge vehicles in 15 minutes. ABB also intends to list the fast-charging station division as an independent company on the stock exchange soon. This means investors focusing on e-mobility can invest in the company’s projects in an even more targeted way. The stock market launch is set to take place in the first half of 2022 at the earliest.

Investing made easy

There are various ways investors can enter the e-mobility market. The easiest option is to invest via ETFs and funds focusing on e-mobility. These investment instruments usually comprise a balanced mix of equities of key players in the vehicle construction, supply and battery technology segments. On PostFinance’s e-trading platform, investments can be made in relevant ETFs and funds or individual shares.

As well as extensive access to the players in the e-mobility market ETFs and funds also provide the opportunity for diversified investment even with small amounts – and less risk is assumed than when purchasing individual shares directly.

Battery manufacturers

Further progress on batteries is required to enable e-mobility to achieve wider public acceptance. While manufacturers have significantly increased the storage capacity and range of vehicles over recent years – there is still great potential for further improvements.

In Europe, the industry is doing all it can to make European car manufacturers less reliant on Asian battery-makers in future. That’s why the production of lithium batteries is set to start in Europe soon. In recent years, the European Commission has promised over 5 billion euros to drive forward research and development on batteries in Europe.

Raw material producers

Lithium is the main raw material used in car batteries. It’s a light metal that is primarily mined in South America and Australia. Growing demand for e-vehicles has also led to a sharp rise in the need for lithium over recent years. The major producing countries supplied over 25 tonnes of lithium in 2008 compared with 85 tonnes mined in 2018.

But because lithium resources are finite, intensive efforts are currently being made to find recycling options. Swedish company Northvolt is a pioneer in the field in Europe. The company has invested 2.6 billion euros in research and development, while companies, such as BMW, Volkswagen, ABB and Siemens in addition to the European Investment Bank, are also supporting the project financially.

Trend continues – investors can reap rewards

The e-mobility market offers long-term growth potential for investors. The climate crisis is undoubtedly the main driver: more and more countries are providing state incentives to promote e-mobility to protect the climate. The technology behind batteries and charging stations is also being constantly developed to improve its performance and to make it more affordable. Rapid technological progress is likely to boost e-vehicle sales even more.

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