Why do I think new energy vehicle makers such as Tesla will be the biggest winners in the race of selling more cars in the near and longer future? Just think about it! Internal Combustion Engine (ICE) has had been around forever, and it’s as good as it gets! Before Tesla introduced EVs (Electric Vehicles), a self-driving car wasn’t even a big deal until Tesla pushed hard on introducing self-driving levels onto its own EVs. As new energy vehicle makers eager to compete against ICE, they want to prove that their vehicles are more modern, longer-lasting, faster, stronger, and smarter — thus innovation is going to be unstoppable in the new energy vehicle sector which is a sub-sector of the auto industry. Eventually, this sub-sector could overtake ICE one day for good because after all — driving EVs and other new energy vehicles helps the world stops the global warming phenomenon.
Disclaimer: I have an investment in a stock that belongs to an EV maker. Thus, I tend to be more biased with a positive attitude toward the EV industry.
I think Nio’s battery swap technology is one great way to produce jobs. For those who don’t know what is Nio — Nio is a company that is currently specializing in producing luxury electric vehicles (EVs) for Chinese consumers in China’s mainland only. Although Nio is only producing EVs for Chinese consumers, Nio so far had only listed its stock in the United States (surprisingly not yet in China). People like to compare Nio with Tesla and thinking that Nio is a Chinese Tesla, but I think Nio is uniquely different than Tesla besides the point that both of them are producing luxury EVs. Vaguely summing my gist, besides producing EVs, Nio is trying to promoting a lifestyle which caters to Chinese consumers in which Nio knows best — this means besides selling luxurious EVs, Nio is probably trying to provide other luxurious venues that complimentary with Nio EVs. Tesla is just concentrating on producing awesome EVs.
Back to the main point in which I had raised in the first paragraph. I think Nio’s battery swap technology is great for producing more jobs! I imagine that it would require more jobs to produce even more EV batteries for the expansion of battery swap stations. As battery technology improves, Nio has to scale up newer types of EV battery output to fill up each battery swap station — this means even more jobs. As consumers see that their EV isn’t stuck with just one old battery, they can feel confident in getting out to buy an EV since they know their Nio will always be able to swap an improved battery into their EV as each time they go to a battery swap station. As Nio set the standard for battery swap station and battery swap technology, a newer chain of supply for battery swap technology would spring up which creates even more jobs. Each presence of a Nio battery swap station is like a permanent advertisement that drivers would see on the road, and so this could boost Nio’s image in long term — this could allow Nio to grow and prosper which creates even more jobs. I mean I could go on and on…
Disclaimer: I do invest a little bit of my money in Nio. Thus, I do have a favorable outlook (bias) when writing on Nio. Nonetheless, I believe Nio is a great EV automaker in the making, and this is why I have invested some of my money into Nio’s stock.
I was using an app to buy partial shares of Luckin Coffee Inc. (LK), and before I could heavily invest into LK the news broke out that there was a financial fraud report occurred for awhile while the chairman of the company was encouraging such a behavior — nonetheless, the whole incident pushed the stock price of LK way down. Luckily, I bought only around $300 worth of shares of the company since I was testing the water before I would see if I want to heavily go into LK — the loss wasn’t big at all and since then I didn’t even take a look at how much I had lost with the app I bought the partial shares of LK with.
Fast forward today, LK share price jumps 21% since I last checked, and all because there is a rumor that China’s Yum brand (if I remembered correctly) is intending to purchase LK’s China assets. I don’t know what are these assets, and now I’m curious. Whether this rumor is true or not, LK share price is now way higher than since their last drop. Last Friday they were at $1.41 per share, but today LK share price is closing at $2.59 per share.
Investors who are investing in LK are probably now worrying about LK is going to be delisted too since the news last broke that LK’s stock exchange had notified them about their decision of going to delist LK. Furthermore, the United States is trying to pass the law in which to delist all Chinese companies that do not report transparently to the United States’ whatever authorities (I think it’s SEC but I could be wrong). LK could be one of these companies that will get delist from the U.S. stock exchanges.
Personal opinion: I think I’m more confident with LK now since they fired their CEO/Chairman or whoever that got the most saying and was running the company fraudulently. Still, I won’t buy any more shares from LK since the delisting possibility is still there for LK. I also see LK won’t file bankruptcy and still be OK if they don’t sell any asset to Yum or whichever corporation (else) because LK is quite popular in China. Furthermore, LK got a lot of locations that they can easily raise the coffee price per cup just a bit and will make money like a bandit.
I won’t invest any more money into LK share unless LK got delisted from the U.S. and then relist elsewhere. Only when LK relist elsewhere that I could have more confidence in my decision in giving LK another chance. Perhaps then, I might heavily invest in LK, but obviously, I will wait and see how all of this will turn out for LK before I’ll try to do anything rash on LK. This means, even when LK relists elsewhere, I’ll wait a bit before I go strong on LK.
Harry Markopolos came out with a damning report which suggests there are some irregularities with GE’s accounting that have led him to believe GE is cooking the book. I haven’t read his report and so I don’t know the details, but this news has made many rounds in the mainstream media. Since the news broke, GE’s share price has dropped a bit too. As I’m writing this, GE’s share price is now $7.97 a share. Short interest in GE’s stock is climbing too.
The big question is what is going on with GE that has led a famous fraud investigator Harry Markopolos to stake his reputation on a report that alleges GE is a fraud? Even if GE is cooking the book, do you want to be brave and short GE’s stock? According to Statista.com, GE has employed about 283,000 people worldwide from 2005 to 2018. I don’t know how many employees GE is currently employed though. With so many employees are being employed by GE, will the government dare to throw GE under the bus even if the allegation may come true?
Whether the market is up or down, I think traders don’t care because they can make money either way. They can buy into the bull and they can also short into the bear. With the current trade war atmosphere that is going on between the U.S. and China, the market is having a seizure. It behaves erratically. It could spike 300 points in a day or it could also plunge into the abyss such as down 700 points in a day for the Dow. In this current atmosphere, I can see the temptation for shorting GE stock since Harry Markopolos’ report came out. Nonetheless, in this atmosphere, I could also see GE has a chance to weather the storm unless GE is unable to meet its financial obligations on all fronts.
GE is a veteran when it comes to weathering the storm since it’s a 127 years old company. Nonetheless, nothing could last forever, and so GE could be on its last leg. You never know, right? As I mentioned GE is employing a lot of people, and so I’m wondering even though Harry Markopolos may be right about GE is cooking the book — GE could very well be cruising along just fine throughout this storm since it’s a big company and may have the means to connect to the government and the right people to calm down the storm in coming days. When a big company like GE goes bankrupt, I could imagine a lot of people will lose jobs. This could negatively affect the company’s host country in a very big way!
As of writing this, I have not shorted GE’s stock. I’m thinking about shorting GE’s stock but fearing that Harry Markopolos’ report won’t affect GE’s stock price that much. Harry Markopolos said it’s impossible to make sense of GE’s balance sheet, and so I don’t know how much sense for one to go to take a deep look at GE’s balance sheet. Harry Markopolos is famous because he was very early in condemning Bernie Madoff for being a fraudster and he was proven to be very accurate. This man now stakes his reputation on GE is cooking the book, and he compares GE with Enron’s scandal. I think when there is smoke, there may be a fire. It’s just that how brave can you be when there is an opportunity which just appears right in front of you, right?
Has Andrew Yang been so right about automation is slowly taking over more jobs, especially for the trucking industry? Well, check out CNBC video right after the break to see how customer focus of retailers like Amazon has driven more people into developing self-driving trucks!
I imagine that the future of transportation is all about automation. I don’t think this is at all a guess because one just takes a look at China’s huge population and see why right away. I can’t imagine that all people in China, each and every one of them, own a car because there won’t be enough space on the roads and highways — the traffic would be stupidly horrendous than ever before. This is why I think China may lead in the race of AI and car automation!
In order for the automation of cars, I think AI needs to be improved tremendously so accidents won’t occur so frequently. At least, the AI should be a lot better than the human drivers. Once the AI part of the automation of cars got nailed down, I can see that a car service such as Lyft would try to deliver cars to whoever needs ’em. This is when 5G comes into the picture to facilitate the communication between cars, cars and the transportation system, and so forth.
Anyhow, in this blog post I want to concentrate on the Lyft part of the whole automation of the transportation equation. I’m wondering, how Lyft and Uber would fare in a world where all cars are driverless? Imagine, car companies could actually get into the Lyft game themselves. Why would they allow Lyft and Uber to be the middlemen?
Nonetheless, I can see those car manufacturers like Toyota may not want to join the Lyft game because of additional costs. Perhaps, car manufacturers rather manufacture cars only and let the costs of the logistic of delivering cars to the user through car services such as Lyft and Uber. Then I’m still wondering how the dealerships would fare, right?
I can see those car manufacturers would prefer to deal directly with car services such as Lyft and Uber and let go of their dealerships entirely in a world of driverless cars! The dealerships would become rather redundant unless the car manufacturers prefer to allow the dealerships to become a car service like Lyft and Uber. But we have to ask who got more experience in delivering a car to a user in a taxi manner? Of course, the answer would be Lyft and Uber and not the dealerships!
In summary, I think if we’re heading in the direction of all cars to be driverless, then I can see the fading out of car dealerships in favor of Lyft and Uber. Of course, I could be wrong and the car manufacturers like Toyota decides to join the Lyft/Uber game and turn their dealerships into Lyft/Uber service. Nonetheless, I still can’t see car dealerships to be around when driverless cars become proliferated. I see car making companies may rely on Lyft/Uber sort of service or just jump into the game themselves delivering cars through an app and not relying on a costly dealership.