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The Elon Musk Effect: Why Electric Cars Could Be the Next Best Investment

Few would doubt Elon Musk’s skills as a businessman. So, when he says something is worth investing in, it’s worth listening to. Although he prefers to see himself as an engineer rather than an entrepreneur, his bank balance and track record with some of the biggest companies in the world would suggest otherwise.

Although Musk is the leader of multiple ventures, he’s probably best known for his work with Tesla. As co-founder and CEO of the electric car company, Musk has been championing alternative energy sources for more than a decade. Now, it seems, the world is starting to take notice which begs the question: is it time to invest in electric?

Carbon Out, Electricity In

With the European Union pushing to reduce carbon emissions, electric car sales have started to surge. As of October 2020, there were 373,600 “plug-in” cars registered in the UK. Stretch that out across Europe and the number is well over 500,000. The race to reduce emissions and lean on alternative energy sources such as electric is due to Regulation (EU) 2019/631. By 2025 and then 2030, all passenger cars and vans in Europe will have to meet stricter CO2 emissions standards. As such, the value of electric and hybrid cars is on the rise.

The Elon Musk Effect: Why Electric Cars Could Be the Next Best Investment

For those just getting into the markets for stock trading in the UK, electric has become the buzz word. Using concepts such as leverage and types of trading known as contracts for difference (CFDs), online traders are now sizing up the potential of shares in companies like Tesla. In 2020, Tesla stocks have been the proverbial golden goose. From a trading price of $86 in January, shares have breached the $400 mark this year. However, as it always is when trading stocks, nothing is guaranteed. For all the highs Tesla has enjoyed in 2020, it’s also taken some knocks. For example, from a high of almost $500 in August, the share price dropped sharply to $330 at the start of September.

Electric Car Market is Positively Charged

Despite the peaks and troughs, the general trajectory of Tesla shares is positive and that suggests it’s the market to invest in. Of course, Tesla isn’t the only electric option. BMW, Nissan, Porsche and many other established manufacturers are going electric (or hybrid). Alongside the established names are start-ups looking to shake up the car market. Subscription-based company Canoo should be offering electric cars by 2021, as will the Lucid, a company that received backing to the tune of $1 billion from Saudi Arabia.

For all intents and purposes, the race to dominate the electric car market is on and that means it’s a good time to invest. Regardless of whether you’re an individual playing the markets or a business looking for new sectors to attack, electric seems to be the way forward. Will alternative sources of energy overtake electric? Possibly. However, for now at least, it’s the hot market to watch. From Tesla and BMW to Lucid, the options are stacking up and that makes electric cars a powerful investment for the future.

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