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The Winners and Losers of the Electric Vehicle Revolution

(00:07):
Hi everybody. I’m Tim. Melvin. Welcome back to A Better Way to Wealth. Let’s talk again about electric vehicles and the electric vehicle future. Now folks, there’s no question. I am not disputing that electric vehicles are going to be the future of transportation in America. You should also know that I will probably be among the very last people to actually purchase one. I love driving my carbon-based car. My automobile. I’m used to it. I like just getting down the highway. I could go almost 400 miles in my truck before I got to worry about gas and I could get gas at about five minutes usually, rather than sitting at the roadside charging station for an hour. What I am disputing is that this is going to happen as fast as everybody thinks it is. You hear some of these stock touts telling you that EV is the next big thing, and we’re going to sell a “kajillion” cars a year and we’re all going to be driving electric cars 10 years from now.

(01:06):
That is not going to happen. Yes, they will take up a larger percentage of the market each and every year. It’s going to be an exciting growing market. There’s going to be lots of really cool things happening in the electric vehicle space. Now, we’ve talked about this over and over again. You’re getting all these “hypey” new electric vehicle stocks, and I’m going to tell you most of them won’t be here in a decade. You know, you cannot deny the fact that all of the big auto manufacturers, including my favorite picks, Porsche and Volkswagen, have a massive lead on these startups. And they also have an installed customer base. They’re going to be the winners. We also have a big problem in what I call infrastructure. Governments all over the world are spending billions of dollars to build electric vehicle charging stations, just as fast as they possibly can.

(02:05):
But it’s going to take a while and it’s going to be a very long time before there’s even charging stations around the country. Like there are gas stations and of course you can do the EV charging at home thing, but that doesn’t do much for you if you’re on a longer trip or out and about. So we’re going to take a couple of years here to catch up with the EV infrastructure. Now there’s some problems with you know, charging stations and the design and lots of companies working on it. And again, here come the stock tips. “I’ve got this charging station stock. I’ve got that charging station does not revolutionary going to change the world.” No, they’re not. Winners of the charging station battle are going to be the existing car companies that are spending millions of dollars to do the research, to construct the infrastructure, cut the deals for the electricity.

(02:56):
Solar is going to play a role in here, existing energy companies that already have the massive footprint of stations across the United States. And they’re all out there competing now in the charging station space. They will be the ultimate winners of the charging station war, but now we’ve recently discovered there’s a massive problem with electric vehicle charging stations. Guys, they are a computer network. They could be hacked. A company by the name of Pen Test Partners in the United Kingdom, tested a bunch of home charging systems and a charging network, a done by Charge Point, the very large US company. And we’re going to talk about them a little bit more in the video, but all every single device that they tested, including the network, was hackable, easily hackable, and had very poor cyber security. Well, who cares if your EV gets hacked?

(03:58):
Right? I mean, what’s the difference at the charging stations we have? Well, here’s what they can do. They can steal electricity, charge their car and make it look like it was your car. Much the way they, you know, use credit card numbers today so they can steal electricity from you. They can also hold the chargers and charging process or captive for ransom. Now, imagine if they were to seize the network around the United States and held it for ransom. And it was a couple of days where nobody could use that network to charge up their cars. That would be something of a disaster to say the least. You can create massive electric grid instability that is causes serious civil unrest. We’ve seen blackouts in New York and other major cities before… Doesn’t play out really well. So they can also do that by just overwhelming the electric grid in the section of the United States.

(04:53):
They can also steal information from your car’s computer and get your personal data. Anything that’s personal information that’s stored on your actual vehicle’s computer can also be stolen and they can take over your car after accessing it through the electric vehicle charging station while you’re hooked up to it. It’s a huge problem. Now, there are some companies that have the technology and are doing the research, looking into how do we handle this problem. I think Blackberry (BB)… Remember the great big things we used to have with the stencils, and everybody had one. When cell phones were becoming all the rage back 20 years ago, I guess everybody had a Blackberry. Well, Blackberry’s become a more of a cybersecurity company than a telephone company. These days it’s big into data protection. And they do make the PKI, public key infrastructure security technology, for lots of different internet of things, networks and things like that.

(05:50):
That could be a possible solution for the electric vehicle charging station issue that we’re dealing with. SA International, a global organization for all things mobile and technology has put together a consortium of companies to look in to how do we deal with the cybersecurity issues that are going to face these charging stations. Now, Charge Point (CHPT) was very much a part of that consortium. They’re still an active member that are working real hard to solve the cyber security problem. Now, when Pen Test called them and said, look, we found this hack and it’s a really dangerous hack. We’ve stopped. Cause we don’t really, you know, we can own all of your information if we go any further and information of anybody that’s used your systems. So what you need to know about this is Charge Point to their credit responded very quickly, had it fixed immediately.

(06:45):
They are taking the cybersecurity of their charging stations very seriously. Now having said that Charge Point is one of the largest networks of chargers in the United States, but the current valuation just kind of chases me away. To be honest with you. I can’t see paying that much that multiple of revenue for the company. I think at some point in a severe market disruption in the future, somebody’s going to end up buying charging point. But my bet is that it’s at a price somewhat lower than the stock trades for at the current time. So I think it’s a good company. They’re doing some, some good stuff, but we’re just paying way too high, a multiple. So we’re going to pass on that one, but you know, who else was a part of that consortium of companies working on the charger, cyber security Ford Motor Company (F). Guys do not downplay it.

(07:36):
I know Tesla (TSLA) and oh, I forget the names of all these little companies that are coming up are going to be the Lucid Motors. You’re going to be the next big thing in EVs. One of the biggest winners globally in electric vehicles is going to be the Ford motor company. The symbol here is simply F as you probably know. Now, Ford is going to be the leader in electric trucks with the F-150. They’re the leader in gasoline and diesel power. F-150, it will be no different in the electric vehicle market. So I think you can look at companies like Ford. You can look at Blackberry and these all companies working to solve this massive problem of hackable EV charging stations, but, and again, markets are pretty lofty. I don’t think we need to run to buy anything right now. Now, I’ve owned Ford shares several times in my lifetime.

(08:31):
I’ve always bought him kind of at the depths of a really ugly crash. They’ve always gone down for a few months after I bought them. And I’ve never less than doubled my money in the stock by being patient and riding out the volatility. So far had a pretty good little run here, especially since they announced and demonstrated the new electric F-150 earlier this year. So there’s probably not a rush to buy it, but if you’re looking to play the electric vehicle market, the electric vehicle charging market, all of that, I think the Ford Motor Company is an outstanding way to do so. You’ll collect a nice dividend and you won’t be subject to all the hype and volatility of some of these new startups that were actually doomed before they ever really got going. So that’s a better way to wealth. I’m Tim Melvin. Thanks for watching. Avoid the hype. Let’s let reality guide our way forward into the electric vehicle future. See you tomorrow.