What Are ESG Investments? And How Do They Affect Sustainable Investing?

Sustainable investing is becoming increasingly popular as investors become more aware of the potential risks posed by companies, industries and markets that could have a negative impact on society and the environment. 

As a result of ESG (environmental, social and governance) issues now being taken into account when making investments has opened an array of new opportunities for sustainable investors.

Whether you are new to sustainable investing or simply want to expand your knowledge, this article will provide you with all the information you need to understand what ESG investments are, how they affect sustainable investing and if they are right for you.

What Are ESG Factors?

ESG is an acronym that stands for economic, social and environmental factors. 

Economic factors are related to the company’s ability to generate profits over the long term. Therefore, it is important to take into account the governance of a company, as well as its relationship with its customers, suppliers and employees. After all, companies with high economic sustainability tend to have low debt and high operating earnings, as well as low costs. 

Environmental factors are related to the impact of a company’s operations and/or products on the environment. In addition, environmental sustainability is also focused on the impact of a company’s supply chain and its use of resources. 

Social factors, on the other hand, are related to how a company treats its workforce and its relationships with suppliers and customers.

How Do ESG Factors Affect Sustainable Investing?

There are a number of different ESG factors that can pose risks to sustainable investing. Some of the most important factors include climate change, water scarcity, areas with high risk of conflict and/or terrorism, sustainability programs and initiatives, product safety, social responsibility, and supply chain management.

As the risks of an investment are higher, the return on investment is usually lower. This can make it difficult to earn a satisfactory return on investment, especially for investors who have relatively small amounts available to invest. 

Additionally, companies that have a higher risk of negative impacts may struggle to obtain financing from banks and other sources of capital. However, companies that have lowered their risks through the adoption of best-practice ESG strategies and techniques may be able to secure financing more easily. 

The best way to find companies with positive ESG practices is to perform a thorough analysis of factors that can affect sustainable investing. 

For example, a company that operates in a market that is facing a shortage of water may face problems in the future, while a company that has adopted water-saving technologies and practices may not be affected by water scarcity at all.  

In Conclusion

Sustainable investing is becoming an increasingly popular investment strategy, but it can be challenging for investors to know how to find companies with positive ESG practices. 

That said, when investing in a company with an ESG approach, you should consider its future prospects and the risks it faces. You should also evaluate whether these risks have been reduced through the adoption of best-practice ESG strategies and techniques. 

By taking these factors into account, you can find good investments that can potentially provide sustainable long-term returns and reduce risk.

ESG investing is an approach to investing in companies where the risk of negative impacts from environmental, social or governance factors has been reduced as much as possible. Sustainable investing with an ESG approach involves applying different strategies and techniques to reduce the risks from ESG factors in order to invest profitably in companies that are willing to adopt best-practice principles in these areas.

Sustainable, responsible or ESG investing is an investment strategy that considers an organization’s environmental, social and governance factors when making a financial decision. While many investors are familiar with the principles of ESG investing, not everyone understands what exactly it means to invest using these principles.

COP27: Mark Carney clings to his dream of a greener finance industry

In the months leading up to the Glasgow COP26 climate change conference last November, the UK government spent long hours lining up landmark agreements to be announced during the week on car emissions, deforestation, methane and more.

Among the most eye-catching of the announcements was the commitment unveiled by Mark Carney, the former Bank of England governor, on the conference’s finance day: a pledge that $130tn — four in every 10 dollars under management globally — would be deployed to limit global warming. “This is a watershed,” he said. Quoting the climate activist Greta Thunberg, he added: “It’s not blah blah blah.”

The promise was made on behalf of the Glasgow Financial Alliance for Net Zero (Gfanz), the grouping of banks, asset managers, insurers, pension funds and other money managers Carney had launched in April 2021. It was greeted as a fundamental shift away from purely profit-driven capitalism by the financial sector.

Behind the scenes in 2021, not everyone working on COP26 in government was convinced of the timing, or the wisdom, of Carney’s announcement. “Carney saying we’ve got $130tn of money ready” risked looking “misleading”, says one civil servant working on negotiations at a time when the COP26 presidency was struggling to persuade developed governments to deliver on a promise of $100bn in annual climate assistance to poorer nations.
 
There were also concerns the announcement was more promotional than tangible. “A lot of this came down to Carney’s desire to have something branded as his own thing,” says Ben Caldecott, finance strategy adviser to the UK government in the run-up to COP26. “It became a running joke among those working on finance for Glasgow.”

 

But without Carney’s “convening power” there would have been no alliance at all, says Alex Michie, who advised the Treasury on private finance ahead of COP and now co-leads Gfanz’s secretariat. “The only design we had was to get the global financial system to make science-based commitments to net zero and take near-term action to implement it.”

To reduce the risk of greenwashing, the UK government laid down a single red line, according to Caldecott and the civil servant. Carney’s brainchild would have to agree to work alongside an existing verification body for corporate and financial sector pledges: the UN’s Race to Zero.

“Civil society knew that many of the finance sector commitments were rubbish, so we needed to be proactive on integrity,” says Caldecott, who also leads the University of Oxford’s sustainable finance group.

When Gfanz expanded in November, its governance documents show Race to Zero was put in charge of vetting new and existing members and helping define the speed at which they decarbonised their portfolios.

Yet one year on, and just 10 days before COP27, that red line was erased. Gfanz officially relegated the UN-backed body to the status of one adviser among many at the end of last month. The financial institutions under the Gfanz umbrella no longer have to be aligned with the multilateral body meant to uphold their integrity.

UN guidelines on preventing corporate greenwashing published at the summit on Tuesday concluded that Gfanz and other alliances needed to tighten their standards and be prepared to remove poorly performing members.

The split from the UN-backed body reflects the difficulties Carney’s team has had keeping this self-governing club of financiers together. It came under intense pressure from mutinous American banks reluctant to divorce the fossil fuel sector in the middle of an energy crisis. It also faced a backlash by litigious rightwing political forces who criticise “woke investing” and say the financial sector’s first duty ought to be to shareholders.

Contacted for an interview, Carney sent the FT a written statement in which he said the perceived risk of antitrust penalties over collective action had been a “big challenge” for Gfanz this year, and called on governments to “move more rapidly” on setting guidelines for company transition plans.

 

As COP negotiators meet in Egypt on Wednesday to discuss how to raise the capital for green energy and climate adaptation, the troubles Gfanz has faced reflect a broader struggle within the financial sector over whether business or government should be responsible for channelling cash into stemming the financial crisis, and whether they should take a purist or “broad church” approach to fossil fuels. They also raise wider questions about the strength of the finance community’s commitment to the green transition — and whether institutions promised the rest of the world too much too soon at Glasgow.

A battle over coal

An early harbinger of difficulties in how to define the central goal of Carney’s alliance was a battle over coal: specifically, meeting a target of net zero “financed” emissions, which are linked to financing and investment decisions, by 2050.

Scientists at the International Energy Agency and the United Nations broadly agree that reaching net zero by 2050 means fossil fuels should be actively phased out and plans for new coal power plant projects immediately junked.

The co-chair of Gfanz, businessman and philanthropist Michael Bloomberg, funds anti-coal campaigns and has described the fuel as “enemy No 1 in the battle over climate change.”

But as transaction data rolled in over the months following COP26, it became clear that Gfanz members had continued to double down on existing financing patterns — for example, bond issuances for coal companies maturing well into the 2030s. 

This was especially glaring among the banks who had been convinced to join Carney’s alliance in the unsettled weeks immediately before Glasgow.

JPMorgan Chase, for example, underwrote a $788mn share issuance by the Indian miner Vedanta Resources the month after it joined the alliance in October, according to open source financial data analysed by the NGO Reclaim Finance. Vedanta is developing a new coal mine in India. JPMorgan declined to comment.

But it was not just US banks. Only 60 out of the alliance’s 240 largest members had any policy excluding support for companies developing new coal projects, according to evidence submitted to the UK’s environmental audit committee by the campaign group ShareAction in June.

Beyond coal, only a few leading banks showed a material reduction in bond underwriting for carbon-intensive industries including mining and automobiles in 2021 compared to 2019, according to a report by financial sector research group Autonomous.

 

In June, this continuing activity by Gfanz members and other companies was addressed in a revised, much tougher set of membership rules from Race to Zero. The official interpretation guide to its new criteria made clear that members must “restrict” their facilitation of all new fossil fuel projects, and that “no new coal” must be supported.

Carney’s alliance did not officially adopt this messaging, and nor did financial sector subgroups whose members had strict fiduciary obligations to clients. Some members cited fears that such strict wording would lead to attacks from competition authorities concerned about potentially higher energy costs for consumers if coal plants have to close.

Many financiers argue the sale of a high-emitting asset does not necessarily stop the associated carbon from entering the atmosphere, which means the “carrot” of investment matters more than the “stick” of divestment.

As financiers’ discomfort with the new Race to Zero guidance became clear, activist groups and some lawyers perceived it as a litmus test of their seriousness on climate action. “Banks at Glasgow saw the alliance as a kind of ethereal thing on climate change without ever mentioning the F-word: fossil fuels,” said Beau O’Sullivan, from the Sunrise Project, a network of NGOs. “It is only when the ambition was lifted that the antitrust concern was raised.”

Others like Simon Holmes, a competition law expert and visiting professor at Oxford university, say that if the alliance collectively refused to invest in fossil fuels it could face “genuine issues” of antitrust, particularly in the US. “From a competition law perspective it can be seen as a collective boycott agreement not to provide a service like finance or insurance to customers,” he says.

The political risks of rapid decarbonisation were uncontestably real, especially in the US. Republican attorneys-general and state governors in the US spent the summer cracking down on members of Carney’s alliance, including the asset manager BlackRock, for perceived environmentally driven neglect of the oil and gas industries that provide jobs to the US economy’s heartlands.

This pressure, amplified by rocketing energy prices, pulled at the seams of the alliance. A grouping of US banks including JPMorgan threatened to leave altogether if they were not given more freedom to decarbonise at their own pace, according to a senior banking executive and people involved in talks between Gfanz and banks.

Given the success of Gfanz had in part been measured by its ability to attract a broad church of capital, the stakes of any exit were high. “There was a bit of gamesmanship [from the banks],” says a party to crisis talks within Gfanz. “Were they threatening to leave to force the disconnect to Race to Zero, or did they want out anyway because it was an easy sacrificial lamb to give to the attorneys-general?”

Then, one evening in September, “no new coal” was quietly wiped from Race to Zero’s website. The UN-backed body had taken legal advice, it said when asked, and was told the strict language put its own staff at risk.

The next month, Gfanz put out a statement highlighting its members’ legal rights to follow whatever voluntary pledges they chose to. The banks remain within the alliance.

No business as usual

Despite its shift away from the UN framework, Gfanz says it is committed to transparency and robust benchmarks. “We are acutely aware that unclear boundaries and guardrails on these financing activities can obscure ‘business as usual’ financing,” Mary Schapiro, vice-chair of Gfanz and former chair of the US Securities and Exchange Commission told a press conference in the run-up to COP27.

A new Gfanz-backed data initiative designed to provide greater transparency will be up and running by the end of 2023, the alliance has said, while net zero targets will be “systematically embedded across the financial sector” by 2027. It has galvanised many of its members to set near-term decarbonisation targets, meaning they have pledged to reduce financed emissions as soon as 2025 or 2030.

“We’re going to get real time feedback, not just on individual performance, Gfanz member performance, but also the system as a whole,” Carney said at the FT Moral Money Americas summit last month.

Global banks’ pledges to date put them on track to deliver $1.9tn in energy transition finance a year until 2030, according to research group Autonomous. It says this number is growing but is still roughly half the level of bank support needed for the transition to net zero, which it puts at between $3tn and $5tn a year.

“The hardest work is still to come,” says Hortense Bioy, global director of sustainability research at Morningstar, describing the situation as an “existential crisis” for Carney’s climate finance movement — now worth $150tn. “The reality is that not enough has been done in the past 12 months — some would argue we have moved backwards.”

In his statement, Carney emphasised the alliance’s long term plans. “We need to ensure that energy supply is maintained during the transition so that consumers do not continue to bear the burden of unreliable, expensive energy sources,” he said. “In the short term, that will involve financing for some oil and gas, but what is important is ensuring that we are dramatically scaling up investment in renewable energy to a 4:1 ratio.”

But as Gfanz sets out new commitments, the voluntary bodies intended to set independent standards for the finance industry are falling by the wayside.

 

The Finance Sector Expert Group, set up during COP26 to develop Race to Zero membership criteria for financial institutions, was quietly disbanded in February. Race to Zero has also postponed plans to set up a new accountability mechanism in order to examine the progress of individual financial institutions. Race to Zero did not respond to requests for comment.

Thomas Hale, a public policy professor at the University of Oxford and co-chair of Race to Zero’s expert peer review group, says the UN body did not have the capacity to be a “global police force” that helps the world sort “good” and “bad” net zero. “I’m glad the UN has created this much more robust system . . . but it will need to be backed up by standards and a whole ecosystem working together.”

A different world

The world has changed since last November and, in a time of escalating financial and energy crises, the need to fund the green transition has had to compete with the need to keep the lights on.

The energy crisis sparked by Russia’s invasion of Ukraine has “dented the idealism” of some of the worlds biggest financiers, says Huw van Steenis, a former senior adviser to Carney at the BoE.

US banks’ exposure to oil and gas increased in the first half of 2022 on the back of higher energy prices, while it fell at Canadian and European banks. “There’s a bit of ‘oh, we live in the real world, not the world we want it to be’,” Van Steenis says. “They have to look at some very complex trade-offs between energy security, energy affordability and environmentalism.”

Those trade-offs risk shifting the timeline of the alliance’s path to net zero, especially as it has focused on setting targets over ensuring they are delivered.

While just 8 out of 122 banks in Gfanz have set a 2030 emissions reduction target for the coal sector, 31 have set such a target for oil and gas, covering on average 80% of their oil and gas portfolio, according to analysis published by Gfanz’s banking subgroup on Wednesday.

Close to a third are so-called intensity targets, which assess emissions only in relation to revenues, production or the size of portfolios. These targets are meant to incentivise investments in transition industries — like a steel company investing in hydrogen technology — but do not guarantee any change in real world emissions.

Targets expressed in absolute terms are less common, and stymied by gaps in disclosures and coverage — the asset manager Vanguard, a member of Gfanz, has only committed to manage 4 per cent of its assets under management in line with net zero goals.

Other targets are overly broad and open to interpretation. In the US, for example, Goldman Sachs’ target of $750bn by 2030 includes its advisory business — suggesting it could include the entire value of deals as long as these contribute to the bank’s core pillars of “climate transition and inclusive growth”. The bank declined to comment for this story.

Alliances such as Gfanz will only work if they introduce binding requirements to make sure they have an impact on real world emissions, says Jakob Thomä, co-founder of the 2 degree Investing Initiative think-tank.

He blames a reluctance by financiers to acknowledge the difficult decisions involved in transitioning away from fossil fuels, for example in the case of national governments’ exposure to oil and gas investments.

“If a bank comes out with general guidance on no new fossil fuels, and a smart-ass like me says: ‘Well that means no investment in US sovereigns [government debt] or UK bonds’, that’s a necessary translation,” he adds.

There are undoubtedly more trade-offs to come, as financial institutions wrestle with their obligations to investors, to governments, and to the planet. And nobody involved with Gfanz would dispute that there is much more to do.

Claire Perry, a former energy minister for the UK who also served as COP president, credits the alliance with having already “unlocked chunks of capital into tricky parts of the transition”.

“There is a weird presumption that everything corporates do is a load of greenwash and what governments do is golden,” she says. “We need to be a little more nuanced in thinking about what needs to happen.”

BTC vitality use jumps 41% in 12 months, growing regulatory dangers

 

Bitcoin (BTC) has seen a 41% improve in vitality consumption Yr-on-Yr (YoY) regardless of dramatic enhancements in vitality effectivity and a extra various and sustainable vitality combine — however there are considerations the rise may see regulators clamp down on mining. 

The information comes from a Q3 2022 report by the Bitcoin Mining Council (BMC) which represents 51 of the world’s largest Bitcoin mining corporations.

The report discovered Bitcoin mining to devour 0.16% of worldwide vitality manufacturing, barely lower than the vitality consumed by laptop video games in response to the BMC — and an quantity it thought-about to be “an inconsequential quantity of worldwide vitality.”

Bitcoin mining additionally emitted 0.10% of the world’s carbon emissions which the BMC deemed to be “negligible.”

The rise in Bitcoin vitality consumption comes because the community’s hashrate elevated 8.34% in Q3 2022 and 73% YoY, regardless of fewer blocks being produced and downward value stress.

Blockchain knowledge analytics agency Glassnode is of the view that the “hashrate rise is because of extra environment friendly mining {hardware} coming on-line and/or miners with superior steadiness sheets having a bigger share of the hash energy community.”

Whereas the report additionally claimed Bitcoin mining effectivity to have elevated 23% YOY and 5,814% during the last eight years, additional will increase in total vitality consumption could draw the ire of regulators analyzing the difficulty.

Stress is ramping up on Bitcoin miners from environmentalists who declare its energy consumption is dangerous to the surroundings. Greenpeace is presently operating the “change the code not the local weather’ marketing campaign to encourage the Bitcoin community to maneuver to proof of stake, nevertheless the official account has solely amassed 1100 followers to date.

On Oct. 18, the European Union (EU) launched documentation outlining an motion plan to implement the European Inexperienced Deal and the REPowerEU Plan — with each planning to maintain a detailed eye on crypto mining actions and their environmental results.

The European Blockchain Observatory and Discussion board (EUBOG) additionally advised the EU adopts mitigation measures to reduce the hostile impacts on the local weather attributable to the digital asset sector.

This suggestion has already been enforce to some extent, with the EU asking for its member states “to implement focused and proportionate measures to decrease the electrical energy consumption of crypto-asset miners” to fight the extreme minimize within the vitality equipped from Russia.

Associated: Researchers allege Bitcoin’s local weather influence nearer to ‘digital crude’ than gold

The push for tighter regulation comes regardless of the EU rejecting a proposal in March that will have enforced a complete ban on crypto mining.

As for america, regulatory actions seem like a step behind its EU counterpart.

In September the White Home Science Workplace printed a 46-page doc that appeared into the local weather and vitality implications of crypto-assets, nevertheless, blended conclusions have been reached and no important plan is within the works but.

 

35 state plans on EV infrastructure get approval ahead of schedule

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35 state plans on EV infrastructure get approval ahead of schedule

The Biden administration on Wednesday approved more than two-thirds of the electric vehicle charging infrastructure plans submitted by states, the District of Columbia and Puerto Rico ahead of schedule.

Thirty-five of the 52 EV infrastructure deployment plans submitted by states are now approved as part of the National Electric Vehicle Infrastructure Formula Program. NEVI was created and funded by the $1 trillion infrastructure law enacted in November.

The program makes $5 billion available over the next five years to help states achieve Biden’s goal of 500,000 EV charging stations across the U.S. by 2030.

States with plans now approved can gain access to more than $900 million in funding in 2022-23 to build EV chargers across roughly 53,000 miles of U.S. highway, according to the Federal Highway Administration.

States had until Aug. 1 to submit EV infrastructure deployment plans to the Joint Office of Energy and Transportation, created by the U.S. Energy and Transportation departments in December to assist with planning and implementation of a national EV charging network, including distributing funds to states.

— Audrey LaForest

What you need to know

EV charging issues deter renters, condo dwellers from electric purchases: A 2022 J.D. Power study found 34 percent of car shoppers lack access to home EV charging.

Tesla is sued by drivers over alleged false Autopilot, Full Self-Driving claims: Plaintiffs say Tesla wanted to ‘generate excitement’ about its vehicles, attract investments, boost sales, avoid bankruptcy.

Biden declares ‘Detroit is back’ as he touts EVs: The president said the Inflation Reduction Act will make new and used EVs more affordable.

Laura Chace

SHIFT PODCAST: Laura Chace touts technology’s role in thwarting traffic deaths (Episode 165)

 

The president and CEO of ITS America details the life-saving potential of V2X technology, explains why it’s taking so long to bring connected-car tech to the market, and urges a fresh mindset on the concept of infrastructure.

Listen to the Podcast >

 

Roundup

Magna tests self-driving delivery bot on Michigan roads as the supplier looks for new revenue streams in mobility.

Argo AI — backed by Ford and Volkswagen — will provide a set of self-driving technologies to companies for ride-hailing and delivery services.

China’s U.S. ambassador: Don’t cut China out of EV chain.

Mitsubishi Outlander PHEV loses eligibility for $7,500 federal EV incentive under new rules.

Mcity, the University of Michigan’s autonomous-vehicle test facility, was awarded $5 million from the National Science Foundation for virtual-reality expansion.

Brain food

Rivian added almost $3 billion to its market capitalization in a day, and all it took was a fairly bare-bones deal with a potential rival.

Last mile

Despite a bevy of recent problems in its home market of San Francisco, General Motors-backed Cruise said it will expand its robotaxi service to Phoenix and Austin, Texas.

 

The 7 Best EV Stocks to Buy – WTOP

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U.S. News & World Report
August 18, 2022, 8:00 PM
The market’s recent turn higher offers a good entry point into EV stocks.
One of the hottest industries to invest in over the last decade has been electric vehicles. A flurry of competition from domestic startups, overseas rivals and established traditional automakers led to strong market activity and investment, with numerous companies soaring to large and even megacap valuations. According to a PwC report, electric vehicle sales rose in the first half of 2022 by 81% compared to the year prior, despite rising interest rates, soaring inflation and ongoing supply chain issues. Despite the stocks of many EV companies falling from all-time highs due to the current macroeconomic conditions, opportunities for bullish growth investors remain. As EV adoption increases due to consumer demand and government regulations, the stocks of major players may resurge again once capital becomes cheaper. Here are the seven best EV stocks to buy in 2022.
Tesla Inc. (ticker: TSLA)
Tesla is the poster child for the U.S. EV industry, with sales of its Model 3, Model Y, Model S, Model X and Roadster automobiles surpassing all other competitors. Founded in 2003, Tesla is currently run by eccentric billionaire Elon Musk and is now worth some $930 billion, landing it a spot in the upper ranks of the S&P 500 index. The stock remains one of the most traded and highly shorted on U.S. exchanges, experiencing high volatility and wide intraday movements. Tesla shareholders approved a 3-for-1 forward stock split at their Aug. 4 annual meeting. Tesla also posted a strong second-quarter performance, with revenues surging 41.6% year over year to $16.9 billion and earnings per share soaring 56.6% to $2.27.
Rivian Automotive Inc. (RIVN)
Tesla competitor Rivian was founded in 2009 and went public in November 2021 via an initial public offering that saw its share price soar. At its height, Rivian commanded a market value of nearly $100 billion, surpassing established traditional car manufacturers like Ford Motor Co. (F) and General Motors Co. (GM). During this time, Amazon.com Inc. (AMZN) also purchased a 22% stake in the company. However, the stock has fallen significantly since. It’s down 65.4% this year through Aug. 18. Despite successful initial launches of the R1T pickup truck and R1S SUV, momentum has faltered, with Rivian posting a loss from its automotive business of $1.7 billion in the second quarter. That being said, the company expects to meet its production forecast of 25,000 vehicles in 2022.
Lucid Group Inc. (LCID)
Lucid initially started out as a battery technology company, but pivoted to development of its first car, the Lucid Air, in 2014. Compared with fellow Tesla competitor Rivian, Lucid’s lineup targets the luxury EV niche, with a refined exterior and high horsepower. However, the company’s second-quarter earnings report was a big miss, with revenue of $93 million versus analyst expectations of $147 million. Lucid also cut its production forecast for 2022, and is now predicting 6,000 to 7,000 vehicles this year versus initial guidance of 12,000 to 14,000. Management blamed the continued supply chain issues for the decline, citing “bottlenecks” in its manufacturing operations despite having nearly 37,000 customer reservations. LCID is down 52% this year.
Nio Inc. (NIO)
Shanghai-based EV manufacturer Nio saw its shares rocket to an all-time high of $61 in January 2021. As Tesla’s strongest overseas competitor, Nio has a well-developed and well-supported lineup of vehicles, including the EP9 coupe, EC6, ES6 and ES8 SUVs, and the ET7 full-size sedan. The company has also announced numerous upcoming models, including the EF9 minivan and ET5 midsize sedan. A notable feature that distinguishes Nio from Tesla is its network of battery-swap stations that replace a traditional charging network. Nio recently announced that it delivered 10,052 vehicles in July, representing a 26% year-over-year increase, and has deployed more than 1,000 battery-swap stations in China. The stock is down 37.2% this year.
Xpeng Inc. (XPEV)
Xpeng is another Tesla competitor from China. The company was founded in 2014 and went public on Aug. 27, 2020, via an IPO on the New York Stock Exchange. Currently, Xpeng offers three cars: the G3i SUV and the P5 and P7 sedans. Thanks to the Chinese government’s generous subsidies for new EVs between 2009 and 2016, Xpeng has seen strong growth, reaching a market cap of $20 billion this year. The company recorded monthly deliveries of 11,524 EVs in July, a 43% year-on-year increase. Chinese consumers are looking forward to the official launch of the company’s new G9 luxury SUV, which is expected in September.
General Motors Co. (GM)
Having recovered from the largest industrial bankruptcy in 2009, with $82 billion in assets against $173 billion in liabilities, General Motors is now pivoting strongly into the EV space. The company is committed to an “all-electric future” via its Ultium EV battery platform, which will be used in the EV versions of its existing Chevy Blazer crossover, Hummer (SUV and pickup models), Cadillac Lyriq SUV, Chevy Silverado truck, Chevy Equinox SUV and Chevy Bolt subcompact models. The company is also making significant investments into commercial delivery vehicles in the form of BrightDrop and a nationwide charging network via Ultium Charge 360. GM is partnering with LG Energy Solutions to build a plant the size of 30 football fields for mass-producing Ultium battery cells.
Ford Motor Co. (F)
GM isn’t the only U.S. legacy automaker seeking an EV pivot. Its largest competitor, crosstown rival Ford, has also made big strides in recent years, especially with the launch of the Mustang Mach-E crossover, the E-Transit van and the acclaimed F-150 Lightning truck. Like GM, Ford is going “all in” on EVs, with the company announcing an $11 billion investment into electrification in 2020. The company has also quietly developed North America’s largest charging network, with over 63,000 plugs. Notably, Ford also has a 12% stake in Rivian after a $500 million investment during Rivian’s IPO. For the recent second quarter, Ford recorded strong year-over-year revenue growth of 57% in its automotive business, which accounts for 94% of total revenues.
7 best EV stocks to buy:
— Tesla Inc. (TSLA)
— Rivian Automotive Inc. (RIVN)
— Lucid Group Inc. (LCID)
— Nio Inc. (NIO)
— Xpeng Inc. (XPEV)
— General Motors Co. (GM)
— Ford Motor Co. (F)
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The 7 Best EV Stocks to Buy originally appeared on usnews.com
Update 08/19/22: This story was published at an earlier date and has been updated with new information.
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