The year 2021 appears to be the year when the market for autonomous vehicles and electric automobiles begin to rise. Even though worldwide EV market growth slowed in 2020, overdue to the pandemic-induced lockdown, there are some reasons for positivity. Industry leaders, players in the market and framed policies increased their investments in electricity in 2020. The returns on pure-play electricity ranged from 5-10 times. The transition to EVs can not deny, and its momentum continues in 2021. Here, we will discuss the top 10 reasons for calling the year 2021 the growth of the EV industry.
• New electric truck launches scheduled for 2021-22.
Most analysts see electric trucks as the real opportunity in the EV space, with EV manufacturers such as Lordstown Motors Corp., a relatively new truck maker, claiming its first model, the Endurance, will be available in 2021. Tesla’s angular, stainless-steel Cybertruck expected to go on sale in 2021. Other automakers have joined the party and, with General Motors (Ticker: GM) announcing its new GMC Hummer, which will be available in 2021, and Ford (Ticker: F) announcing its electric F-150, which will be available in 2022.
• Rivian, an Amazon-backed electric vehicle manufacturer, plans to go public this year.
The electric vehicle start-up Rivian Automotive, backed by Amazon and Ford Motor Company and valued at USD 50 billion, plans to go public this year. Rivian electric vans are already in production and are delivering. And Rivian R1T electric pick-up trucks expects to hit the market in June, with R1S SUV deliveries followed shortly after. Furthermore, Ford and Rivian will collaborate in developing a new battery EV based on Rivian’s platform.
• Role of utilities operating in EV space
The increased use of EVs has increased demand for EV charging stations, and utilities play a vital role in the EV market because they have the expertise and advantage of setting up faster and more efficient charging stations. It is likely to encourage utility companies involved in the EV market to build more charging stations across the country. According to the Natural Resources Defense Council (NRDC), utility companies have permitted to finance nearly USD 1.5 billion in EV charging-related programmes. In November 2020, a group of big utility automakers announced the formation of the Zero Emission Transportation Association to advocate for policies that will increase EV sales. A few utility stocks are taking steps to expand their presence in the EV market expected to rise in 2021.
• Tesla Synonymous for Electric Vehicles
Tesla’s stock price rise (over 600 per cent in 2020) to become the world’s most valuable automaker by market capitalization is attracting investors to EV start-ups. The company ended the quarter with acute liquidity, increasing cash by USD5.9 billion to USD14.5 billion in 2020. Despite steep valuations, markets view Tesla stock as an innovative technology platform for EVs following the stock price surge. Analysts anticipate earnings-per-share (EPS) of $4.15 in 2021, with a forward P/E ratio of 162.75. (See Figure 4) The company is anticipating robust revenue growth of more than 48 per cent in 2021 (Figure 3) and intends to increase EV sales volumes to 20 million annually over the next ten years.
• Increased demand from fleet and logistics companies in 2021
The American Council for Freight Efficiency anticipates significant demand for electric buses and trucks from the large fleet and logistics operators such as Amazon and United Parcel Service demand for electric buses from larger school districts.
• New Govt. policies of 2021 are becoming the basis of EVs
Many policies announced by the govt in this year budget 2021, giving more emphasis on electric vehicles. The announcement of the scrappage policy, which would aid in encouraging the use of greener vehicles, would almost certainly be planned in such a way as to boost the adoption of electric automobiles.
• Budget 2021 is seeing as a pace towards boosting EV
As per the Union Budget for 2021-22, the customs duty has been reduced to 7.5 per cent on semis, flat and long products of non-alloy, alloy, and stainless steels. It will reduce the manufacturing costs for automakers, which is further expecting to result in lower prices by making them affordable for the customers.
• Many start-ups are on the road to boost EVs in India
In March 2021, Ola Electric, a subsidiary of the Indian ride-hailing company, i.e., operating a two-and-a-half-hour drive from Bengaluru. It has announced that in the coming twelve-week the world’s largest electric motoring plant in Hosur will take USD 330 million to produce two million units a year. By 2022, Ola Electric wants to increase its production by pumping 10 million vehicles annually or 15% of e-scooters worldwide. The leading engineering, procurement and construction company of India, Sterling and Wilson Pvt Ltd (SWPL), has announced its accession to the electric movement sector in India. It signed a 50-50 Enel X partnership to start up and build an innovative charging infrastructure in India on 1 April 2021.
• Large amount of investment done by Automakers
The billions of dollars invested by big automakers in developing electric vehicles are beginning to show up in mainstream vehicles in the auto industry. According to Morgan Stanley analysts, global EV sales will increase by 50% or more in 2021.
• Alacrity is the crucial key of 2021 in lifting EVs
Sales of EVs are mounting by creating enthusiasm among the people to move towards new technology. According to reports, 15,910 EVs were sold in India in January 2021, of which the maximum units sold in Uttar Pradesh, with Bihar and Delhi following.
The growth path in the EV industry seems evident EV manufacturers invested trillions of dollars despite the impact of COVID-19 on car sales. It looks promising for the sector in 2021, with increasing awareness about the environment and more EV space for investors.
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