“Are you crazy.”
My friend Sasha scoffed as we drank latte for our Sunday morning ritual. Across the table, Brian shrugged, confident in his statement. “You’ll see. Soon even your parents will want one. Top gear he is lying “.
I watched the exchange between my two friends, already familiar with this discussion.
Look, this was in 2011, and we were discussing electric cars. More specifically, the Tesla (Nasdaq: TSLA) Roadster – the first series of road-legal electric cars you can buy from a company. By then the car had been on the market for about three years, and we had seen the Top gear episode that implied that the shiny new vehicle was defective (the reason Tesla sued Top gear).
We were fascinated by what this technology meant for our future, so I ended up routinely discussing it with my friends in their twenties over coffee.
After all, it was pretty much something out of a sci-fi novel: a lively sports car that ran solely on lithium batteries. It was like an exciting science experiment that you could try for yourself if you had $ 101,500 to spare.
Sasha was convinced that the entire industry would collapse and burn; I didn’t think people wanted to spend more than $ 100,000 to own an unreliable device because they had to charge “like an iPod.”
And he was right, at least about the Tesla Roadster’s short lifespan.
It was on the market for about four years and less than 2,500 were sold. It was a failure for the most part. Even Tesla CEO Elon Musk said so.
But, as is often the case, failure helped pave the way for a success story of epic proportions.
See, the Roadster launched Tesla on a trajectory that has boosted its stock 1,081% in the last five years. The Tesla brand now routinely makes headlines on major news sites. And Tesla’s success is just beginning, despite the bumpy road – it’s the shortest stock on Wall Street right now because of the fears that have always surrounded groundbreaking technology in its infancy.
That success is just one indicator of how this technology will completely revolutionize the automotive market, despite what my pessimistic friend Sasha predicted.
Look, electric cars are already capturing the imaginations of people around the world.
In fact, UBS bank forecasts that electric vehicles will account for 14% of global car sales by 2025, up from 1% today. Countries are wisely preparing for this change in the car market: Australia is already preparing to build the world’s longest “electric highway”, spanning 1,250 miles and 18 sports stations. Better yet, France and the UK recently announced that they will ban gasoline cars by 2040.
And brands and governments are increasingly working together to bring this piece of green energy into the mainstream by offering incentives: For example, BMW and Nissan just started offering discounts to San Diego residents that, when combined with a Federal tax credit of up to $ 7,500 and a state discount of $ 2,500: Reduces $ 20,000 from the cost of a new electric car.
To top it off, Volvo stated that from 2019 it will only make electric or hybrid cars.
Meanwhile, technology continues to develop by leaps and bounds: Top gear He recently drove the highly anticipated Tesla Model S around 670 miles on a single charge, though I admit it was in unrealistic condition considering it was driven in the summer with the air conditioning turned off. It’s not something you could do in South Florida without dying of heat stroke.
But this powerful machinery is the reason why many experts have reserved one of these bad boys for themselves. For the sake of comparison, the standard Tesla Model S 100D lasts about 300 miles. And that was already impressive.
As countries continue to lessen the burden of owning an electric car, technology continues to evolve and institutions focus on making it more affordable miles; many of the obstacles to this innovative lithium technology are falling by the wayside.
All of this shows just how shortsighted the detractors of electric cars (and Tesla) are.
So as an investor, if you haven’t entered this market, now is absolutely the time to start researching the technology-based opportunities that are sure to benefit. You don’t want to be left behind as the next great automotive revolution looms.