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Electric Vehicle Stocks to Buy: Beyond Tesla and the Other Obvious Names – Business Insider

Electric vehicle adoption has picked up dramatically over the past five years, with Elon Musk’s Tesla leading the way.
The stock has seen a stellar rise, as the company stole a lead in electric car technology, while the traditional auto giants were asleep at the wheel. However, there are many lesser lights riding the same wave that may have more upside left in them. 
The shift from fossil fuel-powered vehicles to electric is a vital part of the global effort to reduce carbon emissions, but it is far from clear that the transition will be completed in time to meet international targets.
One very large and conspicuous speed bump slowing the progress of this change is the lack of charging infrastructure for electric vehicles. People need to feel confident they won’t find themselves stranded at the side of the road with a flat battery. 
In most developed economies, there are usually multiple gas stations in every town and along every major road. Petroleum-powered vehicle owners are accustomed to very easy access to refuelling, wherever they wander.
For electric car owners, the situation is very different. You have the convenience of charging an electric car at home, but once you head out on the road, it becomes tricky. Electric charging points are few and far between relative to their fossil fuel counterparts. 
Clearly, putting in the infrastructure that makes car recharging as accessible as filling up with petrol, or gas, is a vital next step in the energy transition that will attract huge investment from both companies and governments. This creates great opportunities for investors. 
“When thinking about electric vehicles and the investment opportunity they represent, the first thought goes towards the manufacturers of the vehicles themselves like the omnipresent Tesla, but also increasingly the traditional car manufacturers that are racing to present their fully electric vehicle ranges,” said Xiaocheng Lin, head of research at Solactive, in a whitepaper on the subject.
“Clearly, electric vehicles are the main growth trend in the automotive industry with the share of electrically powered vehicles projected to increase from 3% today to close to 60% by 2040. On the back of these projections, companies in the electric vehicle industry have seen strong stock price growth and reaching substantially higher valuations than traditional car makers. This does of course also mean that a lot of the future growth expectations have already been factored into their stock prices.”
“What often gets overlooked is the necessary formation of an ecosystem to enable this growth,” Lin said. “In order to sustain 600 million electric vehicles on the road by 2040, today’s charging infrastructure needs to massively expand, both in a commercial and domestic context.”
“The future of cars is electric,” added Hector McNeil co-CEO of HANetf. “In a few decades, from Shenzhen to San Francisco, it will become the norm to drive a battery-powered vehicle. However, underpinning this revolution will be a huge build out of car charging capacity. Just as the growth of traditional cars in the 20th century required the building of gas and petrol stations, the electric car revolution in the 21st century will require abundant charging stations and home units.” 
There are two main strands to the investment opportunity this presents; battery charging equipment manufacturing and electric vehicle charging stations.
Lin said companies in the former category manufacture equipment that can be installed directly in owners’ garage, homes or at workplaces. The equipment can also be setup at existing parking lots.
Companies to invest in that tap into this market include Blink Charging, Wallbox, Beam Global, Zaptec and CTek
The second category includes companies that are engaged in the charging infrastructure network setup. 
“Apart from the knowledge and skills of manufacturing battery charging equipment, it also requires expertise in network design, location planning and optimization, and construction, in order to provide a systematic EV charging solution,” Lin said. 
Firms such as ChargePoint Holdings and EVgo and Compleo Charging Solutions are good investment options for this aspect, Lin pointed out. 
Another option is to buy a thematic ETF which offers exposure to a basket of these stocks. Launched this week by HANetf in partnership with Solactive, the Electric Vehicle Charging Infrastructure Equity UCITS ETF offers investors exposure to all these companies in one trade. 
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