What a ride…
Tesla went from $2 billion to a $1 trillion market cap … up 500X in 11 years.
A few years ago, almost every analyst on Wall Street couldn’t sing the company’s praises loud enough. Why? Because Tesla would be the leader in electric vehicles (EVs) and dominate the market.
All the big automakers, like Ford and Hyundai, followed suit making their own EVs to sell.
But reality is starting to take hold and the days of easy money seem to be over.
Because right now, EV sales are plummeting. And unsold inventory is starting to pile up.
Ford pushed back its plan to produce 600,000 EVs annually to late 2024 instead of the end of this year.
Hyundai has been throwing in discounts to spur sales, but it just isn’t happening.
These automakers are losing big money on every EV they sell…
- Chinese EV maker Nio lost $35,000.
- Rivian lost $33,000.
- Ford lost $32,000 … this is in addition to the $2 billion loss they had in 2022.
Ford’s CEO Jim Farley pushed back his expectations. He believes Ford’s EVs won’t be profitable until 2026 … and that the price gap between EVs and ICE vehicles won’t be closed until 2030.
And Tesla … missed on both earnings and revenue for the first time since 2019.
Elon Musk, one of the greatest promoters of all time, is trying to “temper expectations” on the rollout of the Cybertruck.
What the heck happened on the way to the “green energy” revolution?
The way I see it, here’s what happened…
The first wave of EV buyers, the low-hanging fruit, already own EVs.
These early adopters bought and have been driving EVs for the past few years.
The next wave of buyers … the ones that are on the fence? Well, they are still on the fence because of EV’s high cost and range anxiety.
They are sticking with gasoline-powered cars and are staying put.
But that’s only half the story…
In addition to price and range anxiety, there’s another reason I don’t have high hopes for EVs over the next few years…
There’s a dirty truth about clean energy. More than six months ago, I shared this with my readers…
The battery packs in the average electric vehicle can require up to 10 kilograms of refined cobalt each, which is about 1,000 times what you need for a smartphone.
And that’s just the beginning…
Check it out:
(Or you can read the transcript here.)
In the interview, we discussed…
- Electric vehicles and environmental destruction. (00:27:36)
- How easily the problem could be fixed. (00:39:00)
- Big Tech driving demand for cobalt. (00:55:47)
- From blood diamonds to blood cobalt. (01:02:51)
- It’s time to challenge congress. (01:07:27)
I guarantee what you hear will blow your socks off.
Bottom Line
Fossil fuel is here to stay, at least for the next decade at a minimum, if not longer.
And as an investor, this is something you need to take action on.
You can see what I recommend here.
Regards,
Charles Mizrahi
Founder, Alpha Investor