It's one of the most devastating shortages in the energy markets since the 1970s.
And soon, it could spark the beginning of the next phase of the EV boom…
Earlier this month, 5,500 miles of the Colonial Pipeline were shut down by a hacker group called DarkSide.
The attack left millions along the entire east coast of the United States unable to fill their tanks.
The operators of the pipeline were forced to pay an incredible $5 million in ransom to regain control of the pipeline again.
And Americans were still reeling from the effects of this major shutdown more than a week later.
With some service stations in Washington D.C., for example, left without gas.
A story that repeated itself throughout much of the east coast.
Pandemonium Breaking Loose
The shortage led to panic buying unlike anything we’ve seen in years, which led to bizarre tweets from government agencies warning against unsafe hoarding behaviors.
And it even brought on physical brawls, breaking out at gas stations from Georgia to North Carolina and beyond.
The potential impact of shortages like this one on the U.S. automobile industry can't be ignored.
In fact, this could be a major inflection point for EV industry-related companies like the ridesharing darling, Facedrive, which has launched for an impressive 437% rise since last March.
And while this particular gas crisis was relatively short-lived, these types of shortages have been happening far too often recently.
This issue seems to pop up at least every few years, whenever the Florida coast is hit with hurricanes, shutting down pipelines and leaving cars with empty tanks again. In January 2021 there was a temporary shortage of natural gas that sent those prices soaring.
And it's brought on flashbacks of a time in 1973 when the oil embargo left Americans in a similar situation to what we're seeing today.
After seeing the pumps dry up time and again, it's brought many scrambling to find out what comes next.
That's why Gizmodo recently said, "The east coast gas frenzy is a warning for the future of driving."
Bloomberg wrote, "Drivers tend to shrug off high gas prices, but the gas crisis coincides with a wave of EV curiosity."
And the Atlanta Journal-Constitution reported, "Electric cars pick up speed during the gas slowdown."
It should come as no surprise that this is probably accelerating the trend toward EVs, as this has been among the biggest trends in the market over the last several years.
And with EV drivers hardly noticing the gas shortage (aside from the lines at the pump that they pass by on their way to their destination)...
The Next Stage of EVs
Facedrive may have found its golden moment after its revenue soared 552% since last year.
It’s built a collection of EV verticals at a time when people are concerned about running out of gas and more enthusiastic than ever about electric vehicles.
Facedrive has built an ecosystem that sidesteps the issues we're seeing today by creating a "people and planet first" philosophy.
Their signature ridesharing service helped put them on the map over the last couple of years.
Facedrive is different from its competitors in that they offer riders the option to hitch a ride with an EV or hybrid vehicle rather than gas-powered vehicles.
And this is particularly important as Bloomberg recently reported that Uber drivers are feeling the pinch today as well.
With a continuing rise in demand for ridesharing today, right now there's not enough gas in many places for Uber and Lyft drivers to even fill their cars to pick up passengers.
But with Facedrive, their model helps many of their drivers steer clear of any issues in that area.
Getting Over the Last Hurdles
The EV craze has taken off recently with major companies and investment funds all pushing to get behind the growing green movement.
But while many people are showing interest in going electric, the cost of buying a new EV can be a major barrier as most prices start around $37,000.
That's why Facedrive also made a power move by acquiring the revolutionary EV company, Steer, from Exelorate Enterprises, a subsidiary company of the leading energy company, Exelon Corporation.
Steer initially set out to challenge the old car ownership model by adopting a monthly subscription model instead.
So rather than paying $37,000 or more upfront for your own EV, Steer offers subscribers the chance to borrow one for a much lower monthly price.
With a Steer subscription, you've got your pick of luxury electric vehicles to choose from on their virtual showroom.
And after choosing the EV of your dreams, you can either keep that for as long as you're a subscriber or trade it in for another.
This has been boosted during the age of COVID-19 when people would much prefer to drive solo.
Finally, with restaurants opening and confidence in gas being hit hard, Facedrive has seen huge growth with their investments in their food delivery service, Facedrive Foods.
And while the pandemic has finally started slowing down, many are still embracing the contactless options to get their fix from their favorite restaurants.
That’s why Facedrive Foods has been offering completely contactless delivery with thousands of restaurant partners at the moment.
And as this has continued to grow, they're now delivering 5,000 deliveries per day on average.
Facedrive Still Heating Up
With concerns about gas shortages increasing during the EV surge, it hasn’t stopped Facedrive from continuing its year of massive growth.
Even with most of the world shut down and staying home more than usual, Facedrive had a more than 6x jump in revenue in 2020 compared to the year before.
And now that the world is set to open up again amid the vaccination push, Facedrive could see another major boost through the rest of 2021.
Today, the gas shortage from the Colonial Pipeline attack is looking like just the excuse many needed to make a shift to EVs.
And while it could lead some to eventually buy electric vehicles of their own as the economy recovers, Facedrive has positioned itself to be a major player in the car as a subscription portion of the recovery.
Between the ridesharing, food delivery, and subscription car ownership models, Facedrive looks set to continue its year of growth in the days ahead.
Other companies to watch as infrastructure woes spur alternative fuel adoption:
Tesla Inc. (NASDAQ:TSLA) was one of the most exciting stock stories of 2020. And though it’s been caught in some controversial stances this year, like Elon Musk’s decision to buy…and then sell bitcoin, the company is still as promising as ever. Morgan Stanley has even set its price target at $900, which suggests there’s still a near 50% upside for the EV giant.
Visionary Elon Musk had his eye on prize long before the hype started building. In fact, ee released the first Tesla Roadster back in 2008, making electric vehicles cool when people were laughing at first-gen electric vehicles. Since then, Tesla’s stock has skyrocketed by over 14,000%. And it’s not just about cars, either. Musk is looking towards a much bigger picture, building the foundation for an electrified future on all fronts.
Yet Elon Musk’s jewel has not been trouble-free, either. In February, Tesla said it would recall more than 130,000 vehicles on safety concerns. These regarded touchscreen failures could lead to the loss of several safety-related features while driving, CNBC reported at the time.
Investors shouldn’t ignore legacy automakers. Toyota Motors (NYSE:TM), for example, is a multi-national automaker that hasn’t ignored the massive shift in the transportation business. In fact, it was ahead of the curve, even. The Toyota Prius was one of the first hybrids to hit the road in a big way. While the legacy hybrid vehicle has been the butt of many jokes throughout the years, the car has been a major success, and more importantly, it helped spur the adoption of greener vehicles over the past ten years.
Bob Carter, TMNA executive vice president of sales explained, “We continue to be leaders in electrification that began with our pioneering introduction of the Prius nearly 25 years ago,” adding “Toyota’s new electrified product offerings will give customers multiple choices of powertrain that best suits their needs.”
While the Prius hasn’t exactly aged as well as some green competitors, Toyota hasn’t left the green power race yet. Just a few weeks ago, actually, the giant automaker announced that three new electric vehicles will soon be coming to United States markets.
Ford (NYSE:F) is legacy giant that is looking to jump on the electric vehicle boom. And while it suffered a major downturn last year, Ford is already bouncing back, with its stock price more than doubling since March 2020. They recently announced they’ll be boosting their spending on EVs to $27 billion through mid-decade.
This major investment includes plans of their own to create an electric cargo van and a plug-in version of their bestseller F-150 pickup truck. And this is just the beginning for the heavyweight automaker.
The most head-turning car in its arsenal, however, may just be its new take on its muscle car classic, the Mach-E Mustang. The affordable electric twist on the company’s iconic sports car lives up to its name. The eye-popping nu-classic can go from 0-60 in just 3.5 seconds, with a range of approximately 300 miles per charge. It even has new tech including Active Drive Assist allowing drivers to operate the Mustang Mach-E hands-free.
Just recently, Ford also announced its new F-150. An electric version of one of the hottest selling cars in the United States. While Tesla’s still-to-be-released Cyber Truck boasts higher specs, the announcement of the iconic F-150 electric model has been very well received, and it has been reflected in Ford’s stock price.
Apple (NASDAQ:AAPL), has always been a pioneer in the tech world. Ex-CEO Steve Jobs paved the way for a greener future for the company and the industry as a whole. From the products themselves to the packages they came in, and even the data centers powering them, Steve Jobs went above and beyond to cut the environmental impact of his company.
And it’s not ignoring the EV boom, either. "We're focusing on autonomous systems. It's a core technology that we view as very important. We sort of see it as the mother of all AI projects. It's probably one of the most difficult AI projects actually to work on." Apple CEO Tim Cook on Apple's plans in the car space.
Apple's rumored car design means that more active material can be packed inside the battery, giving the car a potentially longer range. Apple is also examining chemistry for the battery called LFP, or lithium iron phosphate which is inherently less likely to overheat and is thus safer than other types of lithium-ion batteries.
But it’s worth keeping an eye on the newcomers, too, like Xpeng Motors (NYSE:XPEV), which has been making impressive gains thanks mainly to a growing demand for its stylish vehicles and promising financials.
Xpeng has also been drawing plenty of interest from Big Money, managing to raise nearly a billion dollars from heavy hitters such as Alibaba, Abu Dhabi’s sovereign wealth fund Mubadala Qatar Investment Authority, Hillhouse Capital, and Sequoia Capital China.
Newcomers like Xpeng provide an excellent opportunity for investors who missed out on Tesla’s meteoric rise or Chinese Tencent-backed Nio’s (NYSE:NIO) storming of the market in 2020--even if its shares did rise too far, too fast.
The boom in electric vehicle success has also fueled a boom in other EV-related companies. Blink (NASDAQ:BLNK), for example, an electric vehicle charging company, has risen by over 300% in just a few months, and the sky is the limit for this up-and-comer. A wave of new deals, including a collaboration with EnerSys and another with Envoy Technologies to deploy electric vehicles and charging stations adds further support.
Blink Charging really is a mature company, having been around since 1998. Its unique proposition is that many of the company's charging stations are found in practical locations, such as airports and hotels, making it convenient for drivers to charge up while waiting on flights or in their rooms.
BLNK has also been particularly active inking new deals, including 26 dual-port Level 2 IQ 200 EV charging stations at key Burger King locations across the Northeast; 20 Blink-owned IQ 200 electric vehicle charging services with Illinois' Blessing Health, and an exclusive seven-year agreement with Lehigh Valley Health Network for the former to own and operate charging stations across the health network's extensive portfolio of locations.
Though electric vehicles often dominate the ‘energy transition’ landscape, it’s worth keeping an eye on hydrogen plays like Plug Power (NASDAQ:PLUG), as well. Morgan Stanley's Stephen Byrd believes green hydrogen will become economically viable quicker than investors appreciate saying Plug Power's deal with Apex Clean Energy to develop a green hydrogen network using wind power offers a chance to tap into "very low cost" renewable power and helps accelerate the shift to clean energy. Plug has a goal for over 50% of its hydrogen supplies to be generated from renewable resources by 2024.
The company has also just announced a partnership with Universal Hydrogen to build a commercially-viable hydrogen fuel cell-based propulsion system designed to power commercial regional aircraft. The initiative will help bring Plug's proven hydrogen ProGen fuel cell technology to new markets.
Plug is riding high the hydrogen hype. Its share price is up over 550% since last May, and it’s showing no signs of slowing. Hydrogen is already being touted as the fuel of the future, and a vital component in the world’s race to reduce carbon emissions.
California-based Bloom Energy (NYSE:BE) is another hydrogen play to keep an eye on. The company designs, manufactures and sells solid-oxide fuel cell systems. And, yes, there’s been a ton of cash burn up to this point, but it’s heralding massive innovation--and that’s what tech startups are all about. Growth runways, not immediate profit.
That’s why we are willing to throw tons of money at our innovative future. Eventually, the narrative changes and for the successful companies, the cash burn stops and there starts to be payback for investors. Anyone who didn’t get in on time got left in the innovation dust. That’s what’s already happening with Bloom. Savvy investor patience is paying off. Bloom is now on track to be the first fuel cell maker to become cash-flow positive.
And this could all be about to get even bigger. Why? Because this relatively small company is thinking in huge terms: We’re not just talking about fuel cells for construction vehicles or to power remote electricity generation … Bloom is thinking far bigger than that. It’s targeting utility-scale applications of fuel cells and industrial-scale applications and drawing in some very big names in the process.
NFI Group (TSX:NFI) is another one of Canada’s home-grown electric vehicle pioneers producing transit busses and motorcycles. NFI had a difficult start to the year, but it since cut its debt and begun to address its cash flow struggles in a meaningful way. Though it remains down from January highs, NFI still offers investors a promising opportunity to capitalize on the electric vehicle boom.
In addition to its increasingly positive financial reports, it is also one of the few in the business that actually pay dividends out to its investors. This is huge because it gives investors an opportunity to gain exposure to this booming industry while the stock is cheap and hold steady until the market finally discovers this gem.
Not to be outdone, GreenPower Motor (TSX.V:GPV) a thriving electric bus manufacturer based out of Vancouver, is making mvoes on the market, as well. Although for the moment, its focus is primarily on the North American market, but its ambitions are much larger. Founded over a decade ago, GreenPower has been on the frontlines of the electric transportation movement, with a focus on building affordable battery-electric busses and trucks.
Year-to-date, GreenPower has seen its share price soar from $2.03 to its current price of $20.26 That means investors have seen nearly 1000% gains over the past year. And with this red-hot sector only going up, GreenPower will likely continue to impress.
Another roundabout way to gain exposure to the booming alternative fuel industry is through AutoCanada (TSX:ACQ), a company that operates auto-dealerships through Canada. The company carries a wide variety of new and used vehicles and has all types of financial options available to fit the needs of any consumer. While sales have slumped this year due to the COVID-19 pandemic, AutoCanada will likely see a rebound as both buying power and the demand for electric vehicles increases. As more new exciting EVs hit the market, AutoCanada will surely be able to ride the wave.
Magna International (TSX:MG) is a great way to gain exposure to the alternative fuel market without betting big on one of the new hot automaker stocks tearing up Robinhood right now. The 63 year old Canadian manufacturing giant provides mobility technology for automakers of all types. From GM and Ford to luxury brands like BMW and Tesla, Magna is a master at striking deals. And it’s clear to see why. The company has the experience and reputation that automakers are looking for.
Magna saw the battery boom before most. In fact, more than ten years ago, it was already making major moves in this emerging market, investing over half a billion dollars in battery production while the market was still gaining traction. Back then, electric vehicles as we know them had barely hit the scene, with Tesla launching its very first car just two years before.
Similar to Magna, Celestica (TSX:CLS), is a company that saw this trend before it took Wall Street by storm. As a manufacturer of key technology in this industry, it has gained a lot of ground, especially in recent years. Celestica’s wide range of products includes but is not limited to communications solutions, enterprise and cloud services, aerospace and defense products, renewable energy and healthcare tech.
Celestica’s future is tied hand-in-hand with the green energy boom that’s sweeping the world at the moment. It helps build smart and efficient products that integrate the latest in power generation, conversion and management technology to deliver smarter, more efficient grid and off-grid applications for the world’s leading energy equipment manufacturers and developers.
By. Mira Hernandez
**IMPORTANT! BY READING OUR CONTENT YOU EXPLICITLY AGREE TO THE FOLLOWING. PLEASE READ CAREFULLY**
This publication contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this publication include that the demand for ride sharing services will grow; that Steer can help change car ownership in favor of subscription services; that new tech deals will be signed by Facedrive and deals signed already will increase company revenues; that Facedrive will achieve its plans for manufacturing and selling Tracescan devices; that Facedrive will be able to expand to the US and globally; that Facedrive will be able to fund its capital requirements in the near term and long term; and that Facedrive will be able to carry out its business plans. These forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include that riders are not as attracted to EV rides as expected; that competitors may offer better or cheaper alternatives to the Facedrive businesses; changing governmental laws and policies; the company’s ability to obtain and retain necessary licensing in each geographical area in which it operates; the success of the company’s expansion activities and whether markets justify additional expansion; the ability of the company to attract drivers who have electric vehicles and hybrid cars; and that the products co-branded by Facedrive may not be as merchantable as expected. The forward-looking information contained herein is given as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.
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