DISTRUPTERS

 

Toyota Motor (TM), is the world’s largest automaker. And its industry is facing one of the most powerful and most varied set of disruptions in the history of capitalism. I don’t believe we’ll see the “death of oil” any time in the next decade. But we will see a continuing shift toward electric vehicles (EVs). So instead of the best oil companies, I’d much rather own the best companies involved in EV battery technology and materials. That’s where the biggest growth is happening.

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Self-driving cars have gone from a science-fiction fantasy to actually operating in the real world. Waymo – owned by Google’s parent company Alphabet (GOOGL) – is successfully testing self-driving taxis in Phoenix, Arizona. And Tesla (TSLA) has invested tremendous amounts of money into making its vehicles partially autonomous. While estimates of autonomous-vehicle adoption over the next 20 years are all over the place, it’s safe to say this technology is extremely disruptive to the “old” transportation industry. Autonomous-vehicle technology leaders like Nvidia (NVDA) stand to benefit.

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The final disruptive change for the auto industry is the growing importance of “tech” in cars.

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From entertainment systems to navigation to voice-activated controls, the role that high-tech software plays in cars is growing every year.

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The technology behind the digital assistants – which are operated with voice commands – is dominated by Big Tech companies like Amazon (AMZN) and Google.

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Powerful new automaker, component makers, and software makers will take their market shar and deliver massive rewards to shareholders.

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As with any major business change, I hope you see it as a huge investment opportunity.

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