The world is ever-evolving, and we are always looking for new ways to move forward and improve our lives. At one point in time, gas-powered cars were the way forward, they revolutionised the way we travel and made it easier than ever to get somewhere. However, as we have learnt more about the impact of cars on the environment, more people are investing in electric cars as an alternative. Electric cars have the potential to change everything, so here is our beginner’s guide for everything you need to know.
The History
Before we get into the modern impact of electric cars, we first need to go back in time to the 17th century and the original invention of the electric car. Of course, the concept has evolved massively since then, but the idea of using electricity as a means of powering a car can be dated back to 1837.
Until the invention of gas-powered cars, electric cars dominated the roads as many people enjoyed the smooth ride of electric cars. Once petrol and diesel cars started to gain popularity, electric cars were all but forgotten and for the next 50 years or so, people seemed to only drive gas-powered cars. Gas-powered was the cheaper alternative, and the cost of battery power just couldn’t compete with the cheap price of a combustion engine. However, electric cars have recently been making a comeback, many people and manufacturers are seeing the damage gas cars are doing to the environment and are willing to make electric cars accessible for everyone.
Types of electric cars
There are three types of electric cars: hybrid, plug-in hybrid, and battery. There are also new electric vans for sale, as well as heavier commercial vehicles such as HGVs, but this article will focus on consumer vehicles. Let’s take a look at each:
Hybrid electric cars
Hybrid electric cars, as the title implies, is a car that is powered by a combination of an internal combustion engine and an electric motor. Whereas in other electric cars the battery is plugged in to charge it, a hybrid electric car charges the battery through regenerative braking and by the internal combustion engine.
Plug-in hybrid cars
Like the hybrid electric car, the plug-in hybrid also has an internal combustion engine as well as a battery to power the car. However, the difference with the plug-in hybrid is that the battery can be charged by plugging it in and also by regenerative braking. The plug-in hybrid will mostly run on the electric power until the battery runs out and then it will automatically use the internal combustion engine.
Battery-powered cars
The battery-powered electric car is a vehicle that is 100% powered by electricity. As there is no combustion engine, it means that the vehicle produces zero emissions, and you can charge the battery just by plugging it in.
The different types of electric cars give the driver some options to choose from when deciding which one to purchase. While electric cars may not be for everyone, if you are thinking of getting an electric car you could consider leasing electric cars like the Vauxhall Mokka E so you can get a feel of the car first.
Environmental impacts
The major benefit to electric cars is that they have a positive impact on the environment. Air pollution has become a major issue in the fight against climate change as the emissions produced from cars severely damage the environment. Even the hybrid models of electric cars produce way less emissions, so you can still be doing your bit for the environment, even without an entirely battery-operated car. The eco-friendly materials used on an electric car is also having a positive impact on the environment too, as many car manufacturers are using recycled materials to build their electric vehicles. Furthermore, the batteries that power the car are recyclable too, which reduces the need to produce new batteries.
Health benefits
The environmental benefits and the health benefits of electric cars go hand in hand as air pollution caused by gas-powered cars can have a severe impact on people’s health. In major cities that have a large amount of air pollution, it is likely that you will find people suffering from certain health issues. Constantly breathing in polluted air can lead to the development of lung cancer, as well as increasing the chances of having a stroke. Everyone in the world should have access to clean, breathable air, but if we continue to pump the environment full of emissions, we will continue to see people suffer as a result.
There are many changes that need to be made in order to reverse some of the effects of climate change. Climate change has an impact on everyone, so therefore everyone should be doing their bit to reduce their own impact on the earth. Electric cars, though they may need some improvements, could be the change we need to see our planet return to the way it was.
Investing in electric vehicles
Investing in electric vehicle manufacturers has proven to be a popular value investing strategy in the last decade. Tesla Inc (ticker: TSLA) has become a trillion-dollar company and was admitted to the S&P 500 index in late 2020. Other electric vehicle firms Rivian and Arrival have also listed via IPO or SPAC merger, resulting in a boom time for capital raising for electric vehicle firms.
Are electric vehicle firms the best companies to invest in? No one has an accurate stock market outlook and therefore it’s impossible to say. Perform your own financial statement analysis and company research before deciding to buy shares.