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VW, GM and Co. depend on Tesla: Change of favorites in the electric car race on the stock exchange

2021-03-22T07:10:54.187Z


2020 was Tesla year on the stock exchange - but everything has changed since January. Shareholders now prefer traditional automakers like Volkswagen or General Motors. The old car economy is suddenly convincing with its electrical plans.


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Electric cars at the race in Berlin:

Investors are increasingly judging manufacturers on the stock exchange based on their prospects in the business with electrically powered vehicles

Photo: DPA

It is one of the most hotly debated topics on the stock market: Which automaker will be ahead in the long run in the race into the mobile future, in which gasoline and diesel drives will probably no longer play a major role?

In the past year, investors' response seemed clear.

They literally fought for shares in Tesla, driving the price of the California paper from just under $ 90 at the beginning of 2020 to as much as $ 880 twelve months later.

The stock market value of the company of co-founder and boss

Elon Musk

(49) also multiplied and reached its highest level in January of this year at around 840 billion dollars.

Since then, however, the favor of investors has shifted to a large extent.

A Tesla share currently costs around $ 650.

Since its record high at the end of January, the paper has lost around 25 percent of its value.

It performed significantly worse than the US stock market as a whole, which, measured against the broad S&P 500 index, even ended up razor-thinly in positive territory in the same period.

What is particularly noteworthy, however, is that Tesla has left pretty much the entire field of the traditional auto industry behind on the stock exchange in recent months, not just in this country but worldwide.

The performance of the Volkswagen share, which has already increased by more than 45 percent since the beginning of January, is particularly outstanding.

The paper is now quoted at a level that it had not seen since 2015 - the car manufacturer from Wolfsburg became the most valuable company on Germany's stock exchange this week.

And Volkswagen sticks to the back of the competition at the stock market rally: Mitsubishi, General Motors, Ford - the papers of the three have also already increased by more than 40 percent this year.

Daimler shares are up almost 30 percent, while BMW shares are up almost 20 percent.

It is still only a minor correction.

With a market value of almost 630 billion dollars, Tesla continues to outshine corporations such as Volkswagen (just under 140 billion euros), Daimler (just under 80 billion euros) or BMW (around 54 billion euros).

A huge leap of faith on the part of the stock exchange traders continues - but the change in mood is noticeable.

And he has reasons.

On the one hand, the optimism of investors, fueled by successful vaccination campaigns in many countries, plays a role that the corona crisis will soon be over and that the economy could experience a strong comeback.

Cyclical stocks have therefore been preferred on the stock market for months, i.e. papers from companies that usually do good business in an economic upswing.

This basically also includes car manufacturers who can hope that customers will possibly make up for vehicle purchases that have been postponed during the pandemic.

However, Tesla is a special case: Investors have always seen the group more as a tech company - and tech stocks, especially on Wall Street, are currently under pressure after strong price gains in the past.

Change of heart among investors

Above all, however, a fundamental change of heart among investors is likely to play a role in changing favorites.

For a long time, stockbrokers apparently believed that Tesla would more or less turn off the lights on the rest of the industry on the way into the future.

Now it is clear, however, that manufacturers such as Volkswagen, General Motors and Mitsubishi are also taking the change in their products and business models very seriously - and they seem to be more and more convincing investors with their plans.

The best example is again Volkswagen: Last week, in a two-hour presentation marathon, the Group presented its future global strategy for setting up battery production with six new factories and a charging infrastructure.

Anyone who still had doubts about the decisiveness with which the Volkswagen management is approaching the electrified future should have been taught better after this first "Power Day" of the group - which was probably based on Tesla's "Battery Day".

Even among the competitors of the Wolfsburg-based company, there is hardly a company that has not already made clear announcements to switch to electric drives.

BMW, for example, also made it clear just last week that they want to speed up the pace of electric cars in the future - although CEO

Oliver Zipse

(57) continues to reject a complete switch to this type of drive.

The largest US automaker General Motors announced a year ago that it would invest a total of 20 billion dollars in the development of electric and self-driving cars by 2025.

In addition, the group wants to offer e-models for all brands in its product range.

At the end of January this year, GM stepped up: Now the company wants to convert its global new vehicle range completely to emission-free vehicles by 2035.

The group aims to become CO₂-neutral by 2040.

The list of examples could go on and on.

Such announcements are getting better and better on the stock market these days.

While traditional manufacturers are more and more concretizing their electrical plans, newcomers like Tesla are finding it increasingly difficult to justify their high valuation, the "Wall Street Journal" quotes Michael Muders, portfolio manager with a focus on auto stocks at Union Investment.

"We are currently seeing a re-evaluation of traditional automakers by the financial markets."

Investors expect convincing electrical plans

Investors receive support from the analysts in banks and investment houses, who are also increasingly putting their trust in the plans of Volkswagen, BMW, Daimler and Co.

According to the "Wall Street Journal", there is now a question in the room: Have we already reached "Peak Tesla"?

A survey by the analysis company Bernstein Research shows how much investors pay attention to the manufacturers' electrical plans when choosing their auto shares.

According to this, 75 percent of the participants named a clear corporate message and a convincing electrical strategy as very important or decisive for their investment decision.

The conventional car manufacturers are evidently able to convince such skeptical investors better and better.

cr

Source: spiegel

All news articles on 2021-03-22

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