Published on November 28 2017

This Industry Will Get Nearly 27 Times Bigger Over the Next Decade

By Justin Spittler, editor, Casey Daily Dispatch

Royal Dutch Shell is moving beyond oil.

You might find this hard to believe. After all, Shell’s an oil giant.

Last year, it pumped more than one billion barrels of oil…and did $240 billion in sales.

That makes it the world’s second-biggest oil company. But don’t let that fool you.

Shell isn’t invincible…not by a long shot.

And that’s because the oil industry is facing its biggest test to date.

• I’m talking about the electric vehicle (EV) revolution…

Electric vehicles aren’t like traditional vehicles. They run on electricity instead of gasoline or diesel.

A few years ago, the market for these vehicles barely existed. There were just a few hundred of them in the world.

Today, there are about one million EVs being driven around the world. And that number grows by the day.

In fact, analysts estimate that there will be 27 million electric vehicles on the road by 2027. This means the market is about to get 27 times bigger over the next decade.

By 2040, experts project that 35% of all passenger vehicles on the road will be electric. That’s up from 1% today.

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• In short, electric vehicles are the future…

Shell knows this. So, it’s doing everything it can to adapt.

In October, it opened its first fast-charging station for electric vehicles at gas stations in the United Kingdom.

It also bought NewMotion last month. NewMotion is one of the world’s largest EV charging operators. It has more than 80,000 sites across Europe.

On Sunday, Shell doubled down on its EV bet by partnering with Ionity.

Ionity is a joint venture between carmakers BMW, Daimler, Ford, and Volkswagen.

This deal will put EV charging stations at 80 Shell fuel stations across Europe.

Each station will feature six state-of-the-art charging posts. They’ll be able to charge a vehicle in as little as five minutes.

These recent moves tell us Shell is taking the EV revolution very seriously. But the oil giant plans to do much more in the years ahead.

In fact, it wants 20% of profits from its fueling stations to come from EVs by 2025.

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• Shell isn’t the only major oil company adapting to the EV revolution, either…

UK-based oil major BP is also in talks with carmakers to install EV charging stations at gas stations.

Total, the French oil giant, plans to do the same with its network of gasoline stations in France.

This is a huge deal.

You see, these oil majors were some of the most dominant companies on the planet for decades. They could basically print money.

Now, they’re rethinking their entire business models just to survive.

And we’re only going to see more of this in the years ahead…

• Every major car company in the world is going electric…

Volkswagen, for instance, plans to launch 30 new EV models by 2025.

British luxury carmaker Jaguar is doing the same thing. In fact, it will soon offer an “electrified” option for each of its models.

General Motors and Ford have also laid out their plans to expand their electric models. Ford, for one, plans to spend $5 billion over the next five years developing new electric models.

• The world’s oil giants cannot ignore this…

That’s because passenger vehicles account for more than one quarter of all oil demand.

In other words, oil companies can embrace electric vehicles…or die.

Shell’s recent moves prove what I’ve been saying for months.

The EV revolution is one of the world’s most unstoppable trends…and it’s just getting started.

It’s also one of the best investing opportunities to come along in decades.

Tomorrow, I’ll show you how to profit from this revolution.

(Hint: It’s not Tesla. The opportunity I’m going to share with you has more upside. It’s also much safer.)

So, be sure to check your inbox tomorrow.

Regards,

Justin Spittler
Tulum, Mexico
November 28, 2017

P.S. Electric vehicles are the future. There’s no debating that. But EVs won’t displace the oil industry overnight. That will take decades.

That means there’s still money to be made off oil. So, if you’d like to make money off oil today, check out this recent essay I wrote. It reveals my top oil speculation for right now.


Chart of the Day: Legendary Short-Seller Agrees—Tesla to Keep Falling

By Joe Withrow, analyst, Casey Research

Legendary short-seller Jim Chanos—most famous for shorting Enron in 2001—recently announced that he’s adding to his short position in electric carmaker Tesla.

Here’s Chanos:

Put it this way. If you wouldn’t be short a multi-billion-dollar loss-making enterprise in a cyclical business, with a leveraged balance sheet, questionable accounting, every executive leaving, run by a CEO with a questionable relationship with the truth, what would you be short?

His new bet echoes what we’ve been saying at Casey Research over the last few months: Tesla is not being valued as a car company… It’s being valued on CEO Elon Musk’s vision.

It’s a story stock.

But investors are starting to question the story. And Tesla has plunged 18% in two months as a result.

Tesla is burning more than $1 billion in cash each quarter. And it’s never booked a yearly profit.

The company has survived only by Musk’s ability to borrow more money in the capital markets.

But Chanos expects Musk to step down within the next three years. If it hasn’t already, Tesla’s ability to borrow money will evaporate when that happens. The story will be over.

It’s just another reason to avoid Tesla at all costs.

—Joe Withrow


Reader Mailbag

Today, readers write in with their thoughts on Doug’s recent interview on the Paradise Papers

You said: “Rich people have the money to hire lawyers to make sure that laws are passed, and manipulated in their advantage. They have the money to hire accountants to take advantage of all the loopholes in the laws. They have the money and the connections to bribe politicians to make sure things are passed in their favor.”

If such is true, why are they sending their money offshore? It appears to me that the safest place is right here at home where their money is protected by the laws they create.

—Tony

Casey is so wrong with his view about privacy. He would only be right if we lived in a world that is civilized, which is not the case. Our world is ruled by savages that steal from the majority with fake money. Privacy helps them conceal their ill-gotten wealth. In an honest world, privacy, of course, is very desirable and civilized.

Same with envy, a horrible thing that should be counteracted in an honest world. But again, ours is not an honest nor civilized world. Why should honest, hardworking people not have some envy for the crooks that steal everything? While we cannot condone envy per se, at least under the circumstances it becomes more understandable.

—Peter

We’d love to hear from you. If you have a question or comment, write to us at feedback@caseyresearch.com.