Are Electric Vehicles Worth Investing In?

| October 1, 2012 | 0 Comments

Tesla MotorsWhen it comes to forecasting an industry’s potential for growth, you’ll probably never find as much dissention as with electric vehicles.  The opinions on the future of the all-electric car range from one extreme to the other.

You’ll hear one analyst declare electric cars are nothing more than a novelty.  Meanwhile, other experts claim most cars on the road will be electric within a decade.

While it’s impossible to know what’s going to happen for sure, one thing we do know is that electric vehicles still have several hurdles to overcome.

Here’s the thing…

The technology behind electric car batteries is not yet affordable or effective enough to make electric vehicles a widespread option.  In a nutshell, the cars are too expensive, don’t go far enough between charges, and take too long to charge.

That’s why Toyota (TM) recently scrapped plans for widespread sale of their fully electric minicar.  Management just doesn’t believe the time is right for this particular vehicle.  Improvements have to be made to battery technology (and infrastructure) before they jump back in.

On the other hand, Toyota is still introducing a fully electric version of the RAV4.  So, they haven’t given up all hope.

And that’s not all…

There’s plenty of hype behind Tesla Motors’ (TSLA) electric cars.  While the company is having some production issues, their vehicles are as popular as ever.  In fact, the buzz on Tesla is getting even stronger as the company rolls out showrooms.

So, what’s it all mean?

Electric cars still have a long way to go before they become a legit alternative to gasoline-powered vehicles.  However, scarcity and cost of oil is a real issue that’s not going away.

As such, I still believe there’s a bright future for the electric vehicle industry.

There will be other alternatives to electric vehicles, such as natural gas fuel and more efficient hybrids.  However, we’re talking about an enormous market.  There’s plenty of room for multiple competitors.

More importantly, there’s a very cheap and easy way to invest in the electric vehicle industry.  You see, most electric vehicle battery makers are trading at penny stock prices.

Keep in mind, it could take quite a while before the investment pays off.  But, if you buy into the companies with promising battery technology, it could pay off in a big way down the road.

Yours in profit,

Gordon Lewis

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Category: Investing in Penny Stocks

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