3 Ways to Invest in the Electric Airline Disruption
That’s right. The world of air transportation is about to change!
Electric vertical takeoff and landing (eVTOL) aircrafts are taking the aviation industry by storm.
Think of flying EVs or air taxis. And companies such as UPS are already taking notice.
These self-piloting eVTOL aircrafts are possible because of America 2.0 technology.
And I want YOU to be able to invest in the ground floor as this industry gains momentum.
[Note: I want to start today’s video by addressing some YouTube comments to make sure you’re in the right place for Bold Profits investing. (0:06) Then, I jump into the full scope of this massive airline disruption. (5:49)]
Find out everything about this airline disruption now and THREE ways to invest today:
I am Not a Day Trader
I want to make clear that any investment ideas I talk about is intended to be for a long period of time. I feel there has been a misunderstanding and many people feel I am providing day trading advice.
Or something where an idea is going to come to fruition in a day or a few days. I am going to say that any investment idea or strategies I bring up are designed to take months, perhaps even years, to come to fruition. If you are looking for short-term ideas, this is the wrong newsletter to be following for that information.
There are a lot of stock traders out there that do day trading advice and talk about technical analysis. We largely never talk about that. What we focus on is big megatrends. They are often related to technology and innovation. They are also related to demographic changes in society.
For example, we talk about the rise of the millennial generation and the generation after them. We might talk about new brands or consumer trends. That is our exclusive focus. We approach it from the perspective of demand and supply, which we refer to as Going Upness.
The last thing I will say is that we guide people to money management rules called Rules of the Game. There are videos on all of these things on our YouTube channel. Please track back to these things and check them out so you get the most out of our content.
The Future of Transportation
If you think about our transportation — cars, buses, trucks, planes — these are anywhere between 50, 70 to nearly 100 years old in terms of when they first came into existence. Most people know what a car is or have traveled by bus one way or the other.
Planes — lots and lots of people have traveled by. A few people may even have traveled by helicopters. There’s been very little innovation in the transportation sector for a long period of time. The basic car is more or less what it was 50 years ago.
Sure, there have been refinements. Yes, the fuel efficiency has gone up. The reliability has gone up. Nonetheless, the car is pretty much the same car. It has four wheels, an engine and it does what it does. The same thing is true for planes.
In this video I am going to talk about innovation in the transportation sector, particularly as it relates to aviation. If you look at this article from CNBC it says, “Why one Wall Street banker is betting flying taxis will replace helicopters.”
In the key points it says “the urban air mobility electric aircraft market, also referred to as flying taxis, could grow to twice the size of the current civilian helicopter fleet.” Then it says, “vertical takeoff and landing electric aircraft startup Archer went public last week in a deal that’s led by Wall Street investment bank Moelis.”
It also says United Airlines announced a $1 billion deal with the startup last week to buy 200 electric vertical takeoff and landing (eVTOL) Archer aircraft. They are just one of many corporate investors. The article talks about the benefits of these eVTOL aircraft.
This comes from Moelis, the investment banker: “These vehicles will be 100 times quieter. They will be significantly safer, cleaner and cheaper.” So four significant benefits of the coming innovation in aviation. In other words, we are going to have aviation choices that are quieter, safer, cleaner and cheaper.
That’s very much in the nature of innovation. It provides and delivers on these kinds of things. If you look at Archer, here’s a picture of what it looks like, it looks a little like a drone. It is in many ways what the new picture of aviation looks like. There are other companies like Archer that are doing similar things.
Here’s a picture of Joby Aviation. You can see they also look similar. It’s a drone that is powered by electricity. It has the ability to have vertical takeoff and landing. Another company in the same area is Lillium. You can see their almost sci-fi looking eVTOL aircraft. It’s super cool looking.
Lillium is also making big plans. The last one I want to show you is Volocopter. You can see it has some similarities to both drones as well as helicopters. One of the big things going on as well is where this innovation is likely to go first. This article comes from Air Cargo News.
I tend to get a lot of my news from trade journals. It says, “Drones are back on the agenda for air cargo.” There’s a reason for this. Freight rates by plane and ship are skyrocketing post-pandemic because there is insufficient capacity to load up everything we need into the ships as they stand.
People are looking at innovation and alternatives like these kinds of eVTOL aircraft for either short range or, eventually, even medium range. It’s too early for long range. There’s additional developments you will see in this article. UPS says they plan to purchase up to 150 electric cargo aircraft.
UPS is obviously a very large company. It’s heavily involved in the delivery business. You can also see completely new companies that plan to go all in on this innovation. This article refers to a company called Dronamics. It’s launching a drone-based cargo airline.
In other words, they are just completely going to skip out on the current model of using planes and go straight to actually using eVTOL aircraft. Dronamics has an aircraft called The Black Swan that can carry 350 kilograms of cargo up to 2,500 kilometers at an 80% lower cost than any aircraft.
This really can deliver on the promise of this innovation. Many of you may be thinking, “Paul, recommend Lillium or Archer or Volocopter. We want to make money.” The truth is, there are some sectors where innovation looks beautiful but is going to take some time to unfold.
Here’s why. Any aircraft is going to have to be certified by the government to be able to fly. Even once they are certified they have to get permission to fly over certain airspace because these aircraft are new and people are obviously nervous about it.
Then there are existing aircraft out there. You have to find room for these to travel safely where they are not a danger to regular people are existing aircraft. My point is, this innovation is going to unfold slowly over time. It’s unlikely to unfold in a day, week, month or year.
This will take a number of years to unfold. It will first be a small thing, then a bigger thing and then, just like the airline business that took 30 years to unfold, this will probably take five or 10 years. However, there are way you can get in on this.
It’s clear whether it be the United Airlines order or UPS’s order or Dronamics telling you they can deliver a lot of weight cheaply, there is a genuine business here. There is a genuine business model that is going to be created around it. There are going to be some bumps along the way.
It’s never going to be quite clear which of these companies are going to be successful. There may be new competitors that come in because it’s so new. What’s the way to invest in it? One of the ways you can do it is to just think about what’s in these eVTOL aircraft.
When I look at them I see a lot of chips, a lot of sensors. In other words, computer chips is what’s driving these. These are largely expected to be autonomous. They are certainly all completely electronically controlled in terms of the way they are operated.
One of the easiest ways to invest in this is to buy into computer chips. One of the ways you can do that is by buying an ETF which has an entire basket of chips. In all likelihood at least one of these companies is going to be serving that market and is going to see the benefit of all these orders.
The ETF I have recommended for semiconductors and chips has been VanEck Vectors Semiconductor ETF (Nasdaq: SMH). It has a broad portfolio of chip companies and chip stocks in it. That’s one way you can look to play on this very new and exciting trend.
Transport and freight are large industries that are valued in the billions of dollars. Then, there’s a second way that many people will probably not be thinking about in terms of how to benefit. That’s through 3D printing.
3D-Printing Investments for Transportation 2.0
I can tell you if you went to Joby Aviation or Archer or Lillium or any of these companies, they are using 3D printing to come up with either the parts or a significant part of these drones. This is a secret way to get into this innovation and, in truth, many innovations including space and others.
The way we have told you to get into 3D printing if you are looking to benefit from this new industry coming up is to buy into the 3D Printing ETF (BATS: PRNT). It’s the ARK Invest 3D printing ETF. The other alternative is you can subscribe to our services where we have 3D printing as a big theme.
We believe 3D printing is going to revolutionize the world of making things. This is a great example of it. The reason these aircraft are cheaper is because they use 3D-printed parts. With 3D printing you can make them easier, make them cheaper, make them safer.
They require a lot less expense. As a result, you get all these benefits coming together in what you make. In our services we have 3D printing companies like 3D Systems, Stratasys, Proto Labs. We have smaller companies across all our services.
I like to tell our readers we are all in on 3D printing. We believe this is a transformational revolutionary technology that is changing the world. If you are interested in that, the easiest way to get started is Profits Unlimited. It’s my flagship newsletter.
The coming transformation of the aviation market as a result of these eVTOL aircraft is going to completely obliterate the current aviation industry in time. It’s going to represent a huge growth sector for business and these stocks. However, it will be an up and down thing as these technologies and companies vet themselves out. The easy way to get into it is to buy into chips and 3D printing.
Editor, Profits Unlimited
P.S. This airline disruption is one of many because of our America 2.0 mega trends. We’ve cleared out all of the old-world companies from our model portfolios. That’s because this bull market that I’ve predicted will be an America 2.0 bull market. To see the full details of what I’m talking about, click here.