The global automotive industry is in transition as consumers increasingly eschew combustion engine vehicles for electric vehicles. It means EVs are capturing a larger share of the global car market, according to French investment bank Societe Generale, with a third of cars sold in China now being electric. The “sharp acceleration” of electric vehicle adoption in Europe has pushed market share to “well above” 20%, analysts at the bank noted, and while US adoption is slowly rising, electric vehicles now have a share of more than 20% of the California market. Alongside this transition, an ecosystem has emerged — made up of automakers, battery makers, lithium producers and more — providing investors with a wealth of options for monetizing this booming industry. And while automakers may be an obvious player, Societe Generale thinks investors should also consider putting their money in commodity and semiconductor names. The bank noted that EVs require much higher amounts of minerals such as lithium, nickel, cobalt and graphite, while EVs use twice the semiconductor content of their conventional counterparts. The bank’s “Battery Electric Vehicles Basket” includes several stocks in the electric vehicle supply chain, including automakers Rivian, Lucid and Li Auto. Contemporary Amperex Technology (CATL), Panasonic, Samsung SDI and Tianqi Lithium are among the battery names in the basket. Within the materials space, lithium producer Ganfeng Lithium, lithium products maker Livent and Australian lithium miner Pilbara Minerals also made the bank cut, while Infineon Technologies and STMicroelectronics were among the chip stocks to be included. Traditional automakers such as Mercedes, BMW and Porsche were also in SocGen’s stock basket. A $300 billion opportunity Investment bank Bernstein, meanwhile, has identified a range of stocks that it believes will benefit most from the influx of Chinese electric cars into Europe. “Chinese brands have been perceived as being of lower quality both at home and abroad. However, the story has changed in recent years as the world heads towards electrification,” the bank’s analysts, led by Eunice Lee, wrote in a note. on March. 9. “Chinese-made EVs are more competitive than ever in terms of quality and value for money. This could be the right time for Chinese EV brands to knock on Europe’s doors.” Bernstein believes there is a huge opportunity in Europe and estimates that the EV market in the region will grow from $50 billion by 2030 to $300 billion in 2030. “Given the capabilities, product range and global ambitions of Chinese [original equipment manufacturers], this is too good an opportunity to pass up,” it said. Among Chinese EV makers, BYD, Nio and Xpeng are “the ones to keep an eye on,” Bernstein said. The bank also owns two European brands in Chinese owned: Volvo owned by Geely and MG Motor owned by SAIC Motor Bernstein highlighted Renault, Stellantis and Volkswagen as the European automakers “most at risk” from increasing Chinese competition in Europe. is so far underpenetrated in Europe,” the bank said. Tesla and under-the-radar plays Tesla is one of Deutsche Bank’s top picks in the EV space. “Among EV makers, we believe Tesla’s bullish thesis remains intact despite an investor day that missed some details, with volumes growing close to 50% this year and a path to deepen its competitiveness and demonstrate its edge in the space with the introduction of its next-gen platform in the coming years,” Deutsche Analyst Emmanuel Rosner wrote in a note on March 13. Jefferies, meanwhile, has three under-the-radar actions to capitalize on the global EV boom: welding products manufacturer Lincoln Electric Holdings; paint equipment manufacturer Graco; and industrial adhesive company Nordson. These are the three companies that will benefit as EV spending increases globally, analyst Saree Boroditsky told clients in a March 8 note. Lincoln Electric designs and manufactures EV chargers, Graco develops sealing and bonding applications for mounting battery packs and modules for electric vehicles, and Nordson designs thermal metering applications for EVs. – CNBC’s Michael Bloom and Sarah Min contributed to the reporting
Wall Street stocks bribe for the rise of electric vehicles
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Bavarian Motor Works AG, business news, BYD Co Ltd, China, Contemporary Amperex Technology Co Ltd, Deutsche Bank AG, Ganfeng Lithium Co Ltd, Ganfeng Lithium Group Co Ltd, Geely Automobile Holdings Ltd, Infineon Technologies AG, Investment strategy, Jefferies Financial Group Inc, Li Auto Inc, Lincoln Electric Holdings Inc, Livent Corp, Lucid Group Inc, Mercedes Benz Group AG, nio inc, Panasonic Holding Corp, Pilbara Minerals Ltd, Porsche AG, Renault SA, Rivian Automotive Inc, SAIC Motor Corporation Ltd, Samsung SDI Co Ltd, Societe Generale SA, Stellantis NV, STMicroelectronics NV, Tesla Inc, Tianqi Lithium Corp, Volkswagen AG, VolvoAB, Xpeng Inc
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