EV Supplier Stocks To Watch Following Hertz Big EV Order

EV Supplier Stocks To Watch Following Hertz Big EV Order

Our theme of Electric Vehicle Supplier Stocks has done well, rising by about 29% year-to-date, outperforming the S&P 500 which was up by about 22% over the same period. The theme has also roughly doubled from pre-Covid levels (end of February 2020). There are a couple of good reasons for the gains. The shift to electric vehicles is gaining momentum, with major automakers doubling down on their EV investments and governments setting aggressive targets for electrification. Moreover, the EV industry got another big boost earlier this week, as rental car major Hertz said that it ordered 100, 000 Model 3 vehicles from Tesla to be delivered by the end of next year. The deal is an indicator of the urgency with which the transportation industry is electrifying. For perspective, Hertz has roughly 400, 000 rental vehicles in total, meaning that Tesla's EVs could account for about 20% of its fleet. Having more rental EVs could also encourage more people to try out EVs and become potential buyers. While Tesla stock soared by almost 14% following the news, we think the news also bodes well for EV suppliers, who stand to benefit as other mainstream automakers and upstarts build out EVs