Tubular

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DOUG  By Guest Blogger Doug Rowat
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Based on the amount of media coverage Tesla receives, you’d think everyone drives one.

In reality, electric vehicle penetration of global vehicles owned sits at only about 3%. Less even than wind and solar’s penetration of global energy consumption:

EVs may one day blanket the world, but it’s definitely not now

Source: As above. Graph sourced from MarketWatch. Click to enlarge.

Now, perhaps this illustrates the market-growth opportunity for electric vehicles in some distant future, but in the meantime, the world still massively prefers old fashioned gas-guzzlers.

In other words, with respect to cars and most other things, the world still runs on oil. One more reason why Tesla’s cutting staff and its stock is off almost 45% from its highs.

But investing straight-up in the oil & gas sector also isn’t easy. Constantly having to time boom-bust cycles is nearly impossible. How many, for instance, overweighted oil stocks in anticipation of the tailwind they’d receive this year from…a war in Ukraine? And buying and holding the energy sector isn’t an ideal alternative as the S&P/TSX Composite Energy Sector is up only 5.9% annually on a total-return basis over the past decade, substantially underperforming the S&P/TSX Composite, which has returned 9.3%.

But there’s a better, and more conservative, way to invest in the energy sector: pipelines. The investment rationale’s straightforward: all that oil and gas is of no value if it can’t be transported and nothing beats the efficiency of a pipeline for doing this. Crude oil transport via pipeline, for example, costs only about US$5/bbl—less than half the cost of rail transport. It’s no accident therefore that the US ships almost all of its oil and gas via pipeline.

Pipeline companies invest enormous capital to build out their infrastructure, so in return they insist on long-term delivery contracts. You can’t have massive capital outlays for expansion projects, which sometimes take a decade or more to complete, if you don’t have earnings visibility. These long-term contracts provide that predictability and give pipelines a utility-like structure. An advantage for pipeline stocks therefore is that they avoid much of the share-price volatility inherent in oil & gas producer stocks.

But this isn’t to say that pipeline stocks don’t still have sensitivity to rising energy prices. They do. This is one reason why the Canadian oil & gas storage and transportation sector (the pipeline sector’s more official classification) is up double-digits y-t-d (see table below).

Another advantage of having pipeline exposure is the consistency of the dividend income. While Suncor slashed its dividend a whopping 55% in 2020, for example, Enbridge and TC Energy raised their dividends 10% and 8%, respectively. In fact, TC Energy has increased its dividend for 22 consecutive years. Enbridge for 27 consecutive years. How many oil & gas producers can say the same?

Canadian oil & gas storage and transportation sector

Source: Bloomberg, Turner Investments. Priced as of June 20, 2022. Click to enlarge.

Electric vehicles are great. They’re trendy, fast, quiet. And they allow you to have cool conversations with your friends about how visionary Elon Musk is. But they’re not even coming close to taking a bite out of global oil demand. And anyone who thought that the global pandemic would provide a ‘teaching moment’ and loosen the world’s grip on oil has been sadly mistaken. Below is how quickly oil demand recovered from the pandemic dip. And consider the oil-demand long-term trend—why fight this as you build an investment portfolio?

Global oil and liquid fuel consumption (million/d)

Source: Bloomberg

And all of this oil we use? It needs to be efficiently transported. Enter Canadian pipelines.

To gain exposure to the sector (and hedge risk), select a well-diversified Canadian equity ETF, but there are plenty of such ETFs that also have above-average pipeline weights. And what this pipeline exposure ultimately offers your portfolio is more conservative leverage to oil and gas prices, reliable and growing dividends, and long-term outperformance of the energy sector without the burden of having to time boom-bust cycles.

What’s not to like?

Doug Rowat, FCSI® is Portfolio Manager with Turner Investments and Senior Investment Advisor, Private Client Group, Raymond James Ltd.

 

138 comments ↓

#1 RowatNation aka Prince Polo on 06.25.22 at 9:47 am

I personally like buying ENB when it’s <$40 CAD. Otherwise, DRIP, DRIP, DRIP…

#2 the jaguar on 06.25.22 at 10:00 am

Amen Doug. This is why you are my favourite. A straight shooter.

#3 crowdedelevatorfartz on 06.25.22 at 10:01 am

Excellent topic Doug.
I noticed just yesterday that several US Democratic Senators were rethinking the Canadian pipeline ban.
Heavy smelly tar sands oil may be on the move again, whether Trudeau’s environazi’s want it or not.

#4 Penny Henny on 06.25.22 at 10:10 am

#115 Dr V on 06.24.22 at 7:17 pm
54 Paging Penny H – from yesterday

So I compared ZWU v ZUT v ZEB. Over the last year WU and UT were pretty close, and ZEB had the big bump up
before the red of the last few weeks. But over 10 years,
ZUT basically doubled ZWU in share price and ZEB outdid ZUT by a fair amount and almost tripled ZWU.

////////////////

Just wondering did you factor in the dividends in your calculations?

#5 Penny Henny on 06.25.22 at 10:14 am

But investing straight-up in the oil & gas sector also isn’t easy. Constantly having to time boom-bust cycles is nearly impossible.-DR

///////////////////

The thing about timing is it need not be perfect. Close is still good.

#6 Søren Angst on 06.25.22 at 10:15 am

yeah oil

#7 Dharma Bum on 06.25.22 at 10:23 am

“Electric vehicles are great… But they’re not even coming close to taking a bite out of global oil demand.” ~Doug
——————————————————————————————————-

Exactly.

And besides, where do all the tree-hugging environmentalist anti fossil fuel types thing electricity comes from for the most part.

Fossil fuels.

So whether your vehicle’s ICE is burning fossil fuels, or the centralized power plant is burning fossil fuels to power your EV, oil ain’t going away any time soon.

Not in the lifetime of anyone reading this blog, anyway.

#8 chopstix on 06.25.22 at 10:35 am

i do hold xeg….will also look around for a more specific pipeline ETF.

#9 Yukon Elvis on 06.25.22 at 10:45 am

I bought ENB, TPR, and PPL last fall when the Rooskies were massing troops in Belarus. Share prices are up a bit and were paying 6% div when I bought. Seems like a good hold for now. The energy world is going to change now that Europe is looking for politically stable oil and gas. Canada might be part of that change. Hard to build new pipelines now so the existing ones are golden.

#10 Faron on 06.25.22 at 10:45 am

Thanks Doug!

Here’s a great analysis of when bonds should play a role in portfolios (as opposed to the 1H downward equity move that has been positively correlated with bond prices). The gist: now, when policy moves have been rapid and are projected to be rapid but before the demand destruction of the CB policy has kicked in. Extension: core inflation will continue to ease.

https://themacrocompass.substack.com/p/time-for-bonds

#11 Søren Angst on 06.25.22 at 10:45 am

Thanks for the info Doug.

You opened my eyes up to Energy Infrastructure ETFs. Before today no clue. My 2 Cdn ETFs have low Energy Infrastructure holdings, maybe 7% tops.

In just a few minutes found a bunch of Energy Infrastructure ETFs like TPYP, ENFR and EINC. The Cdn companies you mention are performing better, though SINGLE stock picks (still smarting over TWTR).

—————–

Ride

yeah oil

for now and the high monthly dividends it provides to retirees like me (in need of cash flow)

and then something like ENB (though, a single stock pick) or TPYP an ETF (though not as well performing as ENB, with ENB as its #2 holding).

I like your thinking here, a lot.

Again, thank you.

#12 TurnerNation on 06.25.22 at 10:47 am

#128 1984 on 06.23.22 at 9:40 pm

^I am a local 416 tax farm slave. Come say hi.
Me I’m just happy when my internet connection does not crap out as it does.

— Here in the Land of Fizer maybe our leaders/government Actor would all post in unison:
“My portfolio has tested positive for a Bear Market. I an grateful for the protection this pathetic weblog provides; it would be much wore without it”. ®

— LOL Life in a Former First World Country alright. ‘But you are free to leave at any time’, the door is open, no try it?”

“The Globe and Mail reports in its Friday edition that if only passport backlogs were the sole problem facing Canada’s beleaguered travel industry. The Globe’s Rita Trichur writes that anyone who has had the misfortune of flying to or from Toronto Pearson in recent months knows that securing a passport is merely the prelude to travel torture. There are long queues at check-in, security and customs. There are other hassles, too, such as lost baggage and that clunky ArriveCan app. The cumulative effect of those problems is wreaking havoc on our travel and tourism industry despite the reopening of the economy. That the chaos has lasted this long is inexcusable and risks besmirching Toronto’s image as a financial centre and a tourist destination just as businesses of all kinds are trying to bounce back from the pandemic. Air Canada passenger Victoria Pullen endured long delays disembarking her plane and clearing customs in Toronto after flying in from New York’s LaGuardia. Her experiences at the two airports is a tale of contrasts. At LaGuardia, she said she “didn’t have to wait for anything. But in Toronto it was just, ‘What is wrong with this airport? Where are the employees? Why can’t we get them?’ I don’t get it.”
© 2022 Canjex Publishing Ltd.

#13 THE DANDADA on 06.25.22 at 10:48 am

Biden in 2021 – Cancels Keystone XL Pipeline first day in office and halts new oil and gas leasing on federal onshore lands and offshore waters.

Biden in 2022 – “Why are gas prices so high?” DUH Homer

Do you even invest in anything with this clueless clown running the show?

I think i’d rather build a hefty CASH position and wait until he’s gone…… Physically that is. Mentally he’s already checked out.

#14 Ponzius Pilatus on 06.25.22 at 10:48 am

About oil and plastic.
I have some “food safe” plastic containers to store some staples like rice and flour.
I think I had them for about 5 years.
I noticed that they are starting to deteriorate.
And are breaking apart.
They cannot be recycled and end up in the garbage and eventually in the rivers and oceans.
This will eventually pose a bigger problem than car pollution.
I’m no advocate for EV cars, but the use of dirty oil will eventually have to be curtailed.
What will the States do with all their pipelines?
Maybe transfer water piped in from Canada.

#15 Søren Angst on 06.25.22 at 11:05 am

EU Travel Tip

May 2023

you will have to pay to enter the EU for travel. ETIAS TRAVEL PERMIT (European Travel Information and Authorisation System), €7. 3 yr validity. Stays of up to 90 days. Same idea as Cdn eTA. Not a visa.

Which nationalities need to apply for ETIAS?
[You do Canada, sorry…including your children]
https://www.etiasvisa.com/etias-questions/which-countries-need-etias

ETIAS FOR CANADIANS
https://www.etiasvisa.com/etias-requirements/canadians

RHS you can sign up to be notified when ETIAS up and running & more info on the kids.

https://www.etiasvisa.com/etias-news/children-etias-travel-europe

#16 Bezengy on 06.25.22 at 11:19 am

Suncor down 6 percent Thursday, up 5 percent Friday. The volatility wears you down eventually, at least for me. I admit I’m guilty of bad investing practices driven mostly by greed. I paid the price for being overweight in oil in 2014 and again in 2020, but reaped the rewards in the good years. I’ll wind down my positions eventually, or so I keep telling myself. Having 23 gasoline engines in my arsenal of motorcycles, outboards, and yard machines doesn’t help with my biases on the future price of oil either, although I don’t use them as much these days.

#17 Søren Angst on 06.25.22 at 11:28 am

#4 Penny Henny

Exactly.

Why I use yahoo! finance + Google Finance.

yahoo gives you the dividend + YTD Daily TOTAL Return (includes the dividend).

Google gives you the YTD Return excl. the dividend.

For example NXF.TO

yahoo:
Yield 8.34%
YTD Daily Total Return 20.33% (stock price appreciation incl. dividend)

Google:
YTD 12.06% (stock price appreciation only)

Also yahoo does a good job on the stock Profile plus a lot of other stuff like Historical Prices, Historical Dividends, etc. I also like the gossip section “Conversations”.

WebBroker Research is good (time consuming) but for a quickie overview, yahoo is great.

#18 Shawn on 06.25.22 at 11:44 am

Bring on a Plastics Tax

#14 Ponzius Pilatus on 06.25.22 at 10:48 am
About oil and plastic.
I have some “food safe” plastic containers to store some staples like rice and flour.
I think I had them for about 5 years.
I noticed that they are starting to deteriorate.
And are breaking apart.
They cannot be recycled and end up in the garbage and eventually in the rivers and oceans.

******************************
The amount of plastic that most of us are tossing in the garbage is an outrage. We even put the garbage in plastic bags! My paper recycling (which probably never gets recycled) goes in plastic bags! (how idiotic is that?)

In my community we have blue bags where we can toss in a mix of plastic, cans and paper. Such a mix probably never gets recycled in reality but we pretend.

Bring on a plastic tax and a lot better separation of the waste streams so stuff can actually be recycled.

#19 Søren Angst on 06.25.22 at 11:49 am

Doug, I also liked you take on EVs.

As much as the Die Grünen, save the snails, whales, trees, bees crowd would like…oil isn’t going anywhere away, any time soon.

I mean if you take 2018 electricity data, Canada surplus energy that year enough to power 13.3M teslas, tops.

If all vehicles in 2018, 35.1M of them, decided to power up the same night Canada needs to build something like 23 Hoover Dams to prevent RATIONING.

If Canada RATIONS, then 4 Hoover Dams needed (you know, the 35.1M Tesla’s are told what night they can power up on).

Of course adding those Hoover Dam equivalents to the Cdn Power Grid will come at NO COST passed on to Die Grünen EV on their electricity bill and will MAGICALLY build themselves overnight (took 5 years to build the Hoover Dam when they had gobs of extra labour in the middle of the Great Depression).

Of course the above are just “details” or an “inconvenient truth” to the

2 bricks short of a full load

Die Grünen EV crowd.

————-

2035 here we come…

#20 Ponzius Pilatus on 06.25.22 at 11:58 am

#16 Bezengy on 06.25.22 at 11:19 am
Suncor down 6 percent Thursday, up 5 percent Friday. The volatility wears you down eventually, at least for me. I admit I’m guilty of bad investing practices driven mostly by greed. I paid the price for being overweight in oil in 2014 and again in 2020, but reaped the rewards in the good years. I’ll wind down my positions eventually, or so I keep telling myself. Having 23 gasoline engines in my arsenal of motorcycles, outboards, and yard machines doesn’t help with my biases on the future price of oil either, although I don’t use them as much these days.
—————————-
“although I don’t use them as much these days”
That’s another beef of mine.
People are accumulating too many toys, which just clog up the garage.
And in the “olden” days, neighbours used to share tools and equipment.
Nowadays, who still even knows their neighbour?

#21 Ponzius Pilatus on 06.25.22 at 12:10 pm

#18 Shawn on 06.25.22 at 11:44 am
Bring on a Plastics Tax

#14 Ponzius Pilatus on 06.25.22 at 10:48 am
About oil and plastic.
I have some “food safe” plastic containers to store some staples like rice and flour.
I think I had them for about 5 years.
I noticed that they are starting to deteriorate.
And are breaking apart.
They cannot be recycled and end up in the garbage and eventually in the rivers and oceans.

******************************
The amount of plastic that most of us are tossing in the garbage is an outrage. We even put the garbage in plastic bags! My paper recycling (which probably never gets recycled) goes in plastic bags! (how idiotic is that?)

In my community we have blue bags where we can toss in a mix of plastic, cans and paper. Such a mix probably never gets recycled in reality but we pretend.

Bring on a plastic tax and a lot better separation of the waste streams so stuff can actually be recycled.
—————————
In the Lower Rainland, we actually have decent recycling facilities in most hoods.
The one close to me is busy all the time, they are constantly hiring.
Definitely, a growth industry.
Probably worth investing in.

#22 Ponzius Pilatus on 06.25.22 at 12:18 pm

#19 Søren Angst on 06.25.22 at 11:49 am
Doug, I also liked you take on EVs.

As much as the Die Grünen, save the snails, whales, trees, bees crowd would like…oil isn’t going anywhere away, any time soon.
——————————
Looks like the Die Gruenen could take over the Chancellor post next election.
All State elections point that way.
Also, the Vice Chancellor, who is Gruen and female could take over sooner.
Scholz is just not up to the task.
Merkel is sorely missed.
BTW, Dolce: Is the river Po still flowing?

#23 Richard on 06.25.22 at 12:19 pm

I know this blog hates now higher interest GICs because it is bad news for the financial planning, advisory business. This is why I stay to myself and be the fly on the wall.

3-4% GICs in a world of 8% inflation. Guaranteed real loss. No liquidity. No income. Fully taxed in non-reg accounts. That’s why they’re a dubious idea. (Unless you already have millions). – Garth

#24 Martin on 06.25.22 at 12:27 pm

I can’t believe the amount of pure BS that is spilled in the ‘steerage section’ of this blog in terms of anti-EV sentiment. Having worked in the industry for the last 27 years, yes I can tell the BS from a mile away.
Having Mr. Rowat add to this by using phrasing in his article that implies Tesla is cutting jobs because of consumer’s overwhelming preference for gas-guzzlers makes this blog completely loose any credibility. Has Doug checked how long the waiting list for an EV is in Canada before he posted this drivel?

#25 Søren Angst on 06.25.22 at 12:29 pm

#18 Shawn

In the old days, when you were probably playing with your toes in a crib as Garth would say, garbage put into paper garbage bags from Safeway then into an aluminum garbage can in the back alley and the garbage man (un-PC, un-#metoo, un-Bill C-16 name back then) would toss it all in a garbage truck.

Today all go berserk sorting, tossing, cleaning etc. vs. the good old days of a one stop garbage can.

So the effort you describe and towards WHAT END?

“After taking into account losses during recycling, only 9% of plastic waste was ultimately recycled, while 19% was incinerated and almost 50% went to sanitary landfills,” it said in its Global Plastics Outlook.

-Feb 2022

https://www.voanews.com/a/percent-of-plastic-worldwide-is-recycled-oecd-says-/6455012.html

Of course, Die Grünen Google replies to the question:

what type of plastics are recyclable

with a laundry list a mile long of which I challenge material scientists to identify in their home.

Which Plastics Are Recyclable By Number?
#1: PET (Polyethylene Terephthalate) …
#2: HDPE (High-Density Polyethylene) …
#3: PVC (Polyvinyl Chloride) …
#4: LDPE (Low-Density Polyethylene) …
#5: PP (Polypropylene) …
#6: PS (Polystyrene) …
#7: Polycarbonate, BPA, and Other Plastics.

———-

I liked it how they snuck in Other Plastics at the end for that

je ne sais quoi

ending, as in, happily ever after.

#26 Shawn on 06.25.22 at 12:31 pm

Excess Profit Tax on Oil companies?

Normally, that would be a terrible idea. It is said that no one offered help to the oil companies when prices cratered a few years ago. But that’s not true.

The NDP Alberta government imposed production curtailments specifically to boost oil prices. The UCP conservatives continues that for a while. Every industry would like to collude to curtail production and boost prices. It’s illegal in Canada except when the government does it.

The NPD signed a massive contract for oil by rail. Individual companies were afraid to take the risk because oil prices and the discount on Canadian oil are so volatile that shipping oil might have been unprofitable.

Trudeau bought a pipeline. Albeit after he blocked two pipelines.

In general there has not been a lot of subsidies for oil companies but there has been some help.

Alberta lowered the corporate provincial income tax from 12% to 8%. That was a pure gift to the oil companies.

Overall I see reason to support a temporary larger income tax on oil companies. Well really I am not sure because the industry crying and wailing and doom saying would be deafening. I’d wait and see if oil is still high starting 2023.

#27 Damifino on 06.25.22 at 12:32 pm

First, there were external combustion engines that burned hydrocarbons to generate steam, which drove pistons, which turned crankshafts which in turn powered the world.

It was a giant leap from the pittance of work that could be accomplished with human labor and it moved humanity a long way from the nasty, brutish and short lives that were the norm until then.

(Actually, not ALL of humanity. A few billion still burn animal dung to cook and heat their homes. Those of us with modern kitchens look upon that as having a “noble” connection to nature, of which developed nations are now deprived)

Second came the internal combustion engine. Hydrocarbons were now burned directly within the engine. No more boilers, coal and water required. We moved from train locomotives to independently moving trucks and earth movers that operated for long periods on relatively small and very dense energy supplies.

Once again, humanity made great strides except in those parts of the world where they’re still combusting whatever they can get their hands on. They’ve remained “noble” however, but not by any desire on their part.

Now we have the electric passenger vehicle. It can properly be said to contain a remote combustion engine. Somewhere distant from the cities in which they typically operate, hydrocarbons are burned, electricity is generated, and transmitted though the power grid (with many losses along the way) to charge the vehicles of a tiny user base of owners who believe they are “doing something for the environment”.

Meanwhile, the heavy lifting of the world we all enjoy (well, erhaps two thirds of us) is still overwhelmingly powered by burning fossil fuels locally. Wind and solar don’t even come into the discussion in a serious way.

And we shouldn’t need to be reminded that it’s not all about burning fuel. Everything that makes us comfortable in modern life is derived from petroleum. Unless you’re a “noble” still burning dung in Botswana.

Is it any surprise I remain long on oil?

And I’m even longer on nuclear which I probably won’t live to see used properly since it must still be decriminalized. But, it’s something many of you can count on.

#28 Richard L on 06.25.22 at 12:46 pm

The tipping point for adoption of electric vehicles has not yet occurred – should be in the next 5 to 10 years. Once this happens nuclear energy will be the growth industry- particularly small modular reactors.

#29 VanIslander on 06.25.22 at 12:47 pm

I can’t believe the amount of pure BS that is spilled in the ‘steerage section’ of this blog in terms of anti-EV sentiment. Having worked in the industry for the last 27 years, yes I can tell the BS from a mile away.
Having Mr. Rowat add to this by using phrasing in his article that implies Tesla is cutting jobs because of consumer’s overwhelming preference for gas-guzzlers makes this blog completely loose any credibility. Has Doug checked how long the waiting list for an EV is in Canada before he posted this drivel?

————————————————

Agreed. Pro oil posts don’t wash with those who see the trend shifting fast. In Victoria the demand is off the charts. 4 of my coworkers just bought EV’s and a few more are planning on EV’s or Hybids in the next year once supply catches up like myself. You can’t find one on any car lot and it’s a year wait for a Toyota Rav4 hybrid. 6 months for a Leaf. Driving around town you see Teslas everywhere as well as other brands. Euros are seeing EV’s demand of upward of 50% of new buyers.

CATL just coming out with a 1000KM battery next year. Think that won’t be a game changer ? Wake up time for the big smokes stuck in the dark ages.

#30 Søren Angst on 06.25.22 at 12:49 pm

#22 Ponzius Pilatus

FYI.

Die Grünen Vice Chancellor is the guy that is firing up coal plants in Deutschland for the recent gas cuts from Russia’s Nord Stream 1 pipeline *.

He also wants to nationalize Nord Stream 1 and 2 in German waters.

Also, Die Grünen Vice Chancellor, SIT DOWN FOR THIS, is willing to take LNG from America that comes from

FRACKING.

Wolfsburg in a sheep’s clothing.

BTW, could not agree more he should be the new Chancellor. Olaf is just a mess esp. during the Ukraine War. Indecisive. Backtracks. Says one thing, does the other.

‘Been following the Die Grünen guy and he is decisive and in times of turmoil does the right thing for his country, torpedoes be damned.

——————

DOUG

* Not all pipelines end well (Nord Stream 1 with gas cuts, esp. Nord Stream II, €9.5 billion, now an empty 1,234 km (767 mi) cigar tube under the Baltic Sea).

https://www.reuters.com/business/energy/germanys-scholz-halts-nord-stream-2-certification-2022-02-22/

#31 Søren Angst on 06.25.22 at 12:58 pm

#28 Richard L

Reactor in the Rumpus Room.

That and 2 bits will buy you a cup of coffee.

Can I sell you some prime RE in S. Florida called “The Glades”?

Rumpus Room dress code for the kids:

https://www.fruugo.it/fully-enclosed-nuclear-radiation-protective-clothing-with-hood/p-81393007-167936596?language=en&ac=croud&gclid=CjwKCAjw5NqVBhAjEiwAeCa97SoYulSFJxZxobYhlE8h44vHec_lGDhlzfy0NUmszwX9nVzPPNTxcBoCa84QAvD_BwE

and USB SmartPhone Rumpus Room plug and play device:

https://www.amazon.it/Misuratore-Radiazioni-Smartphone-Rilevatore-Radiottivita/dp/B09W2R1VGH/ref=asc_df_B09W2R1VGH/?tag=googshopit-21&linkCode=df0&hvadid=588413931099&hvpos=&hvnetw=g&hvrand=3131971169238101416&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=1008658&hvtargid=pla-1645066287519&psc=1

#32 Doug Rowat on 06.25.22 at 12:59 pm

#24 Martin on 06.25.22 at 12:27 pm

Having Mr. Rowat add to this by using phrasing in his article that implies Tesla is cutting jobs because of consumer’s overwhelming preference for gas-guzzlers makes this blog completely loose any credibility. Has Doug checked how long the waiting list for an EV is in Canada before he posted this drivel?

—-

The point of this blog was to present the investment case for pipelines.

The fact that you overlooked this completely confirms my fear: EV sector is a cult.

—Doug

#33 PBrasseur on 06.25.22 at 1:11 pm

Thanks but no thanks! Too cyclical, too political with too many dictators and too many climate nutcases involved.

#34 Stone on 06.25.22 at 1:16 pm

What’s not to like?

———

As much as I prefer ETFs, I do also own Enbridge in my B&D portfolio. As mentioned above, 27 consecutive years of dividend increases for Enbridge along with its 10 year annualized return makes it an attractive piece of the whole portfolio. With an overall compounded return over the last 3 calendar years of 49.90% and those tax efficient dividends, I’m pretty happy.

https://www.fomotina.com/my-investment-portfolio/

#35 Scooby Snacks on 06.25.22 at 1:20 pm

ZEO is a nice mix of oil producers and pipelines. Bought ZEO and Suncor back in 2020 and WOW!!!! Gains of about 150% on both. Still holding but will move some Suncor profits to pipelines now. Thanks for the post.

#36 Fuel refinery and mining question on 06.25.22 at 1:20 pm

Thanks for the blog Garth
Thanks for the post Doug

Totally agree with what you said.

I have two questions,
First I have been hearing allot that there are not enough mines in the world to produce rare earth minerals necessary for EV batteries. A mine can take 5 to 10
Years or more to develop
With that said my question is do you believe that we will not be able to go fully electric with cars in the next 20 years because of these shortages?

Second question
Been hearing allot that high oil prices are a direct result of poor government policy. As a result there had
been no refineries built in North America for over 20 maybe 30 years. Again it takes 10 years or more to build a refinery.
My question, regardless of Price per barrel, we will endure high fuel prices at the pumps for many years to come because there’s not enough capacity in refineries to meet demand.

Thanks
Have a great weekend.

#37 Sail Away on 06.25.22 at 1:21 pm

#20 Ponzius Pilatus on 06.25.22 at 11:58 am

“although I don’t use them as much these days”
That’s another beef of mine.
People are accumulating too many toys, which just clog up the garage.
And in the “olden” days, neighbours used to share tools and equipment.
Nowadays, who still even knows their neighbour?

———-

Well. Amongst several neighbours, we have utility trailers, leaf blowers, weedeaters, chainsaws, wood planers, various specialty tools such as welders, lathes and presses… and we share. Works great. We also look after each other’s pets, keep an eye when folks are away and generally act neighbourly.

There’s an unspoken quid pro quo system that works quite well.

But that’s Nanaimo, where people are friendly and helpful.

#38 Rena on 06.25.22 at 1:26 pm

Richard guy with GICs, I know people like you and this why you have a choice. If you want an advisor or not. I am current on GIC and mortgage rates as I am in the business of lending. First of all the rising rates have pushed the highest GIC rates are now 4.5% to 5% all CDIC insured, provincial deposit insured. Second, if inflation is higher just because they say so, they always lied about inflation rates. Inflation in my personal rates have always been at least 6% to 7% over the years, property taxes, water, electricity, gas bills, gas and other fuel, transportation expenses, insurance, food, many other costs, expenses etc.

Second, nobody gets to have a million or more over night honestly any way. It may take 20, 30 years but saving is what was lost in this country and it was by design. We have now RRSPs, RESPs, RDSPs, RRIFs, TFSAs etc. many ways to keep your money from being added to annual employment income, CPP, OAS other income thus not increasing income tax rates, brackets. The low interest rates, easy money mantra for decades was to get Canadians deep in debt with real estate particularly and discourage saving with low to lower interest rates.

#39 Flop… on 06.25.22 at 1:28 pm

What do all great blog commenters do when they get writers block?

Copy and paste, baby…

M48BC

“The Number of EV Models Will Double by 2024.”

This wave of new electric models is being primarily driven by legacy automakers, many of whom are entering the EV market for the first time. For industry leader Tesla, it means that there is greater competition on the way.

This greater variety of vehicles comes at a time when interest in owning an electric vehicle is rising. In a recent survey from Morning Consult, the majority of American adults (51%) now report being very or somewhat likely to purchase a fully electric vehicle over the next decade.

Millennials are the most likely to be considering an EV as their next vehicle (70%).

https://www.visualcapitalist.com/the-number-of-ev-models-will-double-by-2024/

“Visualizing All Electric Car Models Available in the U.S.”

https://www.visualcapitalist.com/visualizing-all-electric-car-models-available-in-the-us/

#40 Quintilian on 06.25.22 at 1:28 pm

Oil is literally dinosaur stuff.

Look out here comes Helium3:

“One hundred kilograms constitutes more
than enough fuel to potentially power a 1000 megawatt electric plant for a year when
fused with deuterium, the terrestrially abundant heavy isotope of hydrogen.”

Most of you curmudgeons would not know about this.

#41 Cars on 06.25.22 at 1:29 pm

Am I the only person who does not see any of the current electric cars as the solution to the carbon issue?

The batteries used are nothing but filthy and hugely damaging to the environment, incredibly hard to recycle, and HEAVY!

Volvo compared XC40 and Polestar 2 and concluded the benefit crossover point is around 140,000km – right about the time the Polestar 2 soon needs a new battery.

Don’t even get me started on the generation of electricity.

Unless these electric cars go to solid state batteries that are in a standard form, can be swapped between car chassis easily, quickly recharged, and are lighter…well, these aren’t going to solve things is my belief.

This whole thing reminds me of Formula 1 when it had V10 engines.

They went to hybrid, which made the claim possible that the car now uses 110kg of fuel instead of 150kg as it used to. (I know, who measures fuel in weight vs. volume)…

So now Formula 1 with Hybrid claims to be saving 40kg of fuel in a Grand Prix per car. Thing is, the cars are 300kg heaver as a result of this Hybrid engine and batteries – which has to be moved by jets up in the stratosphere. And so these jets burn way more jet fuel that EASILY offsets the claimed car savings of 40kg in a Grand Prix

I haven’t even factored the fuel cost of making all this extra Hybrid stuff…the elements like battery, energy recovery units, electric motors, etc. etc. etc.

I strongly believe Formula 1 with V10 engines was way lower carbon footprint than Formula 1 with Hybrid – and I’m not even accounting for the increase in race schedule. I’m talking like-to-like same weekend Grand Prix compared with V10s vs Hybrids…I feel V10 was greener, and sounded WAAAAY better.

The more I think about this, the more I think the net result of electric cars will be AT BEST a draw. But it will likely turn you to be a BAIT AND SWITCH move that will result in actually worse carbon emissions when all is said and done.

Can’t we just make a LIGHT 4-cylinder nice car? Why is Mazda the only company making such a car right now?

And more importantly, why has the marketing pushed the big heavy SUV upon the masses instead of highlighting how amazingly good a 3000 lbs car with luxury trim and 4-cyl would be for the world. Bad for profit?

Should we not be removing giant heavy cars off the roads instead of this battery car push? Should anyone be allowed to drive a 5000 lbs SUV…by themselves to be honest?

Why are we using equivalent of…a jet powered blower to sweep a square meter of driveway?

#42 Joe Schmoe on 06.25.22 at 1:37 pm

The EV Zealots are showing their fury!

EV’s are cool. But they haven’t made a dent in market. They will sometime. But not in the present.

That is the summary regardless of your religion.

I know, I know, your neighbor’s aunt heard that…but math is math.

Even CBC now has articles highlighting the manufacturing shortfalls for EVs. Even CBC.

Me thinks #21 went long on Tesla stock….

#43 Søren Angst on 06.25.22 at 1:42 pm

#22 Ponzius Pilatus

Forgot. The Po is still flowing. Barely.

Of course expect no help from the Austrians* whom are also firing up their coal plants just like the Germans. Lucky me in the NE of Italia.

Unlike Austria, Switzerland is a good neighbor and will help out Italia in the North due to low rainfall.

https://www.tvsvizzera.it/tvs/qui-frontiera/dalla-siccit%C3%A0-un-occasione-per-nuovi-accordi-sull-acqua-tra-italia-e-svizzera-/47699986

Swiss poll on giving help, lost on Austria:

https://twitter.com/bsant54/status/1540203863554363393

Swiss article link in the Tweet.

—————–

* I prefer Swiss help than from Austria. Same outfit when Covid hit Italia in 2020 they closed their border to Italia and stranded 70-85 km worth of Austrian cars at the Brenner Pass trying to comply with that order and get back into Austria.

Austria could not organize a p!ss up at a Hofbräuhaus if their lives depended on it.

In the Bankers I trust.

#44 TurnerNation Groupie on 06.25.22 at 1:50 pm

Roe v. Wade?

You know this all about control over our bodies as TurnerNation keeps reminding us.

When we were being mandated to be vaccinated, one of the objections regularly pointed out by the anti-vaxers was…”Why can’t I decide what happens to my body? Women can…through abortion.”

And so the argument was somewhat logical and against the ability of bodies being controlled by state. Hence, the argument was simply removed in the Land of the Free…the United States of America Version 2.0.

Now women have no control over their bodies, just like everyone else. No one is special.

The drive toward the lowest common denominator continues. What’s that called?

#45 Ron on 06.25.22 at 1:52 pm

I don’t think people that buy GICs for to become rich or be a showoff. I don’t like anything that goes up or down and no buying a house and living in it for decades, paying it off is not the same thing seeing real estate values go up and down. I am a homeowner because I want I don’t want to pay higher rents every year and keep moving more frequently. Everybody has to decide what they want to do with their own money. This is just me personally. He does have a point that it is simple, easy to do. If you have the savings every year, $20,000 a year for 30 years in a RRSP, TFSA these days could easily be $1.2 million.

#46 Damifino on 06.25.22 at 1:54 pm

#29 VanIslander

Pro oil posts don’t wash with those who see the trend shifting fast. In Victoria the demand is off the charts
————————————

Another demand recently off the charts was for outrageously priced rural homes since urban life was dying at the same time humanity was able to support itself with an army of housebound remote clerk-serfs.

Some EV demand is driven by subsidy and some by green terror. But I’ll happily admit much demand is driven by the fact EV’s are excellent machines to drive (just for the sheer pleasure of it) by people who can afford them. Those people I understand.

The others, typically, haven’t though it all the way through. Like those who partook in the exodus from the cities during the darkest days of the short-lived plague when insanely low interest rates prevailed.

My current car is fueled by hydrocarbons. So will my next one. But it won’t be a “guzzler” (a silly and inaccurate term, nowadays). Now, the ’58 Chevy I had when I was a teenager. That was a gas guzzler.

#47 baloney Sandwitch on 06.25.22 at 1:55 pm

Tesla is cutting staff because of shortage of components (chips, batteries etc) not because of lack of demand. If anything, oil prices have strengthened demand for EV’s.

#48 Elon Fanboy on 06.25.22 at 1:56 pm

Couple of fun oil related investments..

ENS…..up 4.5% ytd. 10.44% dividend.

USOI….down 0.77% ytd, but a ridiculous 21% yield. This ETN is a bit of a hand grenade, handle with care!

I can’t see inflation dropping unless crude prices come down significantly.

As much as I’m a fanboy, EV’s are a dead battery timebomb.

What are we going to do with all these massive dead batteries when they reach end of life?

#49 Søren Angst on 06.25.22 at 2:04 pm

#40 Quintilian

Die Grünen Google to the rescue of curmudgeons.

People also ask

Where can helium-3 be found on Earth?

There is very little helium-3 available on the Earth. However, there are thought to be significant supplies on the Moon. Several governments have subsequently signalled their intention to go to the Moon to mine helium-3 as a fuel supply.

Lunar Power Plants + approx. 384,400 km of VERY high voltage transmission lines that take into account apogee and perigee (bungee cord transmission lines) + 2 masses that are rotating.

————–

Ya. Will work out just fine.

#50 Ponzius Pilatus on 06.25.22 at 2:08 pm

As I said, not an EV protagonist.
I agree with Doug that TESLA is a cult
More into expansion of public mass transport.
But I remember seeing a poll the other day.
Forgot to copy the link.
Maybe someone else has seen it.
According to that poll, about 50% of Canadians will make their next car an EV.
I guess, one has to see if this is even feasible, given all the shortages attached to EVs.

#51 Philco on 06.25.22 at 2:10 pm

Thank You Doug!

I posted here to get out of TSLA $1,200 to $1,250

I’ve been posting that the policies derived by the T2 would be a disaster. Here we are.
Just go 4 min in on Mike….OMG.
I almost fell off the couch on his Gretta comment. LOL!
https://mikesmoneytalks.ca/june-25th-episode/

The cost of energy IS going higher…..and food.

#52 tc-contra on 06.25.22 at 2:18 pm

#41 Cars on 06.25.22 at 1:29 pm

Am I the only person who does not see any of the current electric cars as the solution to the carbon issue?

The batteries used are nothing but filthy and hugely damaging to the environment, incredibly hard to recycle, and HEAVY!

Volvo compared XC40 and Polestar 2 and concluded the benefit crossover point is around 140,000km – right about the time the Polestar 2 soon needs a new battery.

Don’t even get me started on the generation of electricity.

Unless these electric cars go to solid state batteries that are in a standard form, can be swapped between car chassis easily, quickly recharged, and are lighter…well, these aren’t going to solve things is my belief.

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Exactly! The CO2 inputs to produce an EV are higher than a ICE vehicle and, on average, the cross over point is around the 80,000 mile mark (according to TED presenter). So, for the first 80k miles EV owners have directly and indirectly emitted MORE CO2 into the atmosphere than ICE vehicle owners. But hey, who cares about the real facts – it’s trendy to drive an EV because it messages the world that they’re a ‘caring’ human (just like wearing a mask, alone, in their car!)

#53 Ponzius Pilatus on 06.25.22 at 2:28 pm

#170 Sail Away on 06.25.22 at 1:36 pm
#169 Barb on 06.25.22 at 12:51 pm

A lazy man should marry a Taurus woman.
[My daughter’s] husband did.

———

And he also won the jackpot with a supportive, nonjudgmental MIL. Lucky guy!
—————————
Haha,
The cynic in me says that the MIL is not too happy about the unequal division of labour.
My guess is that the SIL has other qualities that her daughter appreciates.
I hear it’s quite common.

#54 Faron on 06.25.22 at 2:31 pm

#170 Sail Away on 06.25.22 at 1:36 pm

And he also won the jackpot with a supportive, nonjudgmental MIL. Lucky guy!

Ruh roh. Looks like the personal attacks baboon has escaped the cage. Putting on my helmet to prepare to deflect baseless claims about my mental health.

#55 Udar on 06.25.22 at 2:31 pm

Wow!
After Tatiana’s smashing success , Mr Rowat decided to show who wears the suspenders and come with the big guns. No click bait title but he used all the tricks in the book. He got our attention with the picture and the loaded first paragraph. Then the big guns: one big graph and some serious data. Not too much though, to not fall asleep.
He made the trip then he land us with a short and sweet conclusion. Great!
Mr. Turner, if your guests raise the bar so much, did it ever cross your mind, you will have difficulties to write on your own blog? Just saying…
What’s next? Be still my heart…

#56 THE DANDADA on 06.25.22 at 2:38 pm

Well I think I’m going to grab my POPCORN and watch the drama pop off in the States today.

This is about to get real good!

“Arizona abortion protest: Police release tear gas, lawmakers ‘held hostage’ in Senate building”

https://www.foxnews.com/us/arizona-senate-abortion-protest-hostage

#57 ElGatoNeroYVR on 06.25.22 at 2:40 pm

For me personally the biggest benefit of the EVˋs and I am surprised that nobody brings it up is the air quality in the cities that have a significant EV fleet ,say…Shenzen (relative to not having them). Not having the exhaust fumes in your lungs every day is awesome from a health perspective.
Yes ,today we just move that polution to coal factories ,however, if planned well these would be well outside of the metro areas and it will allow for a transition to nuclear while incresing our quality of life.

#58 PeterfromCalgary on 06.25.22 at 2:40 pm

Electric cars require a lot of rare metals many of which come from Russia and extraction has a high environmental and health cost. This is why they are mainly mined in non democratic countries as to meet higher environmental, health and safety regulations in democracies is too expensive.

Guillaume Pitron wrote an excellent book about this problem called “The Rare Metals War”. You can find it at your local library, bookstore or online retailer. Here is the link for the book at my local Public Library.

https://calgary.bibliocommons.com/v2/record/S95C1355160

#59 Patel on 06.25.22 at 2:46 pm

The debate on EV vs ICE is so out of whack,it’s not even funny.Its full of politics,ignorance,paranoia etc.

I believe there is some impact of Human activity on planet’s environment re GHG.And we must do something about it.

But that doesn’t mean gagging traditional energy sources like oil and gas.Remember that O&G has brought us to this level of civilization growth.

Now what to do?

Let technology develop on its pace.The solutions are only going to come from Science, Technology and Engineering.

For non science folks…..IT TAKES TIME.

I believe EVs have good chance of surviving ,but instead of full battery a PHEV is a better option for next few decades.

Hydrogen is other good solution but needs a lot of R&D before it can be commercially viable.

Thx
An Alberta Engineer.

#60 David on 06.25.22 at 2:54 pm

#15 Søren Angst – “Applicants under the age of 18 or over the age of 70 will receive their ETIAS free of charge.” “ETIAS is valid for 3 years from date of issue. Can be used for multiple entries under a 90 day duration.” https://etias.com/etias-requirements/etias-for-canadian-citizens

#61 Sail Away on 06.25.22 at 3:05 pm

#53 Ponzius Pilatus on 06.25.22 at 2:28 pm
#170 Sail Away on 06.25.22 at 1:36 pm
#169 Barb on 06.25.22 at 12:51 pm

A lazy man should marry a Taurus woman.
[My daughter’s] husband did.

———

And he also won the jackpot with a supportive, nonjudgmental MIL. Lucky guy!

———

Haha,
The cynic in me says that the MIL is not too happy about the unequal division of labour.
My guess is that the SIL has other qualities that her daughter appreciates.
I hear it’s quite common.

———

Laziness is a vastly-underrated quality of life improver. All I’ve accomplished today is feeding the dogs and three cups of coffee.

Might have some lunch… then maybe a nap in the hammock… unless my wife’s lawnmowing is too disruptive.

#62 Quintilian on 06.25.22 at 3:06 pm

#49 Søren Angst on 06.25.22 at 2:04 pm

“Lunar Power Plants + approx. 384,400 km of VERY high voltage transmission lines that take into account apogee and perigee (bungee cord transmission lines) + 2 masses that are rotating.”

Hint:
Do we still need telephone poles?

And do you know just how little H3 is needed.
The freight would be a negligible cost relative to the ROI

#63 J on 06.25.22 at 3:10 pm

Doug, thanks for sharing your reasoning on investing in Canadian pipeline co’s.

Are you hinting that, for Canadian equity exposure, only owning an ETF that represents the 250 or so S&P/TSX Composite Index companies misses out somewhat on the pipeline upside, and so this should be augmented with a bit more pipeline exposure?

BTW My first “real” job was at TC Energy (back then called TransCanada Pipelines). It was a blast, I learned a ton, got to work with some great people, and felt good about contributing to part of Canada’s infrastructure backbone.

#64 D.D. Corkum on 06.25.22 at 3:11 pm

I can’t dispute the graph; EVs truly are a small portion of total cars **already** on the road. Gasoline will obviously fuel cars for many, many years to come.

However, global new-car sales of the gasoline power train might have peaked in 2017.

Its hard to imagine that driving around Canada, I know. I also wouldn’t suggest that EVs are the main reason: a slowing of new car sales in 2018/2019 had other causes, and obviously there have been supply constraints since COVID. But now when you add EV growth rates in Europe and China (reaching double-digit percentages of new market share), there are at least some gentle headwinds in the horizon.

#65 opee on 06.25.22 at 3:14 pm

Bit of topic but several comments were made re plastic/recycling.
1.Why always bring it to the consumer level and fault.
2 Your Gov. and green enthusiasts can slow and reduce and stop non recycleable plastic, AT The source.

Ban all plastics, manufacturing plastics that cannot be recycled, return to glass containers, extra costs but will
lower recycling, garbage and dump costs.

#66 Doug Rowat on 06.25.22 at 3:17 pm

#29 VanIslander on 06.25.22 at 12:47 pm
I can’t believe the amount of pure BS that is spilled in the ‘steerage section’ of this blog in terms of anti-EV sentiment.

————————————————

Agreed. Pro oil posts don’t wash with those who see the trend shifting fast. In Victoria the demand is off the charts. 4 of my coworkers just bought EV’s…

—-

Nothing reflects the realities of second and third world countries, where there is little EV charging infrastructure, better than Victoria, Canada.

—Doug

#67 Bezengy on 06.25.22 at 3:20 pm

#37 Sail Away on 06.25.22 at 1:21 pm
#20 Ponzius Pilatus on 06.25.22 at 11:58 am

“although I don’t use them as much these days”
That’s another beef of mine.
People are accumulating too many toys, which just clog up the garage.
And in the “olden” days, neighbours used to share tools and equipment.
Nowadays, who still even knows their neighbour?

———-

Well. Amongst several neighbours, we have utility trailers, leaf blowers, weedeaters, chainsaws, wood planers, various specialty tools such as welders, lathes and presses… and we share. Works great. We also look after each other’s pets, keep an eye when folks are away and generally act neighbourly.

There’s an unspoken quid pro quo system that works quite well.

But that’s Nanaimo, where people are friendly and helpful.

—————————

“Efficiency is us” could be our moto on our lake too. Good job!

But……let me tell you a little story.

Last week we had a meat truck overturn on the highway close to us. Probably carrying 30 k lbs of vacuum packed pork. The cleanup crew quickly unloaded the truck into a dump truck and disposed of it at the dump. One local (let’s call him Robinhood) was able to load his pickup up and gave it all away for free to his neighbours. The reserve was 5 minutes away. What a country.

btw…thanks for the reminder SA to check on the neighbour’s pooch.

#68 JacqueShellacque on 06.25.22 at 3:24 pm

#58 PeterfromCalgary

“Electric cars require a lot of rare metals many of which come from Russia and extraction has a high environmental and health cost. This is why they are mainly mined in non democratic countries as to meet higher environmental, health and safety regulations in democracies is too expensive.”

You’re being far too polite here. EVs require up to 20x the amount of metals like lithium than a dirty gas guzzler does, and most of this comes out of the hides of the world’s poorest people, often literally forced to pull it out of the ground at gunpoint, using appalling methods that destroy the surrounding environment beyond recovery. So EVs can’t be about ‘saving the planet’.

It’s also not possible to run modern civilization with ‘renewable’ energy (which, side note, also uses a lot of earth metals too at the collection stage).

So the only conclusion to draw here is that this is all a fantasy. The scale at which they envision trying to carry this out makes it dangerous, perhaps existentially so. Western civilization only exists in its current form because of cheap energy. Ruin this with some dreamtime tinkering, and we may never recover.

This brings up a broader philosophical point about the ‘ends justifies the means’ nature of those movements that have gone all in on Marxism and collectivism (the greenies, the Davos set), but I’ll demur, except to say kudos to Doug for not pandering with hippie-dippie platitudes.

#69 TurnerNation on 06.25.22 at 3:26 pm

There was a new guest blogger yesterday? I’d taken a glance and assumed that one of the other guest bloggers had just transitioned. Forgive me. ‘Tis the season. :-)
—-

BTW the whole R vs. W thing is just part of taking down the Former First World Countries. They want us fighting each other in the streets. Look for next week’s protest marches.
Took a glance at yesterday’s date.
6/24/2022. Add it up the numbers and you get
6/6/6. Is anyone surprised.

#70 tc-contra on 06.25.22 at 3:27 pm

Speaking of EVs, some countries are waking up to the reality of the situation:

Five countries seek to delay EU fossil fuel car phase-out

BRUSSELS, June 24 (Reuters) – Italy, Portugal, Slovakia, Bulgaria and Romania want to delay a European Union plan to effectively ban the sale of new petrol and diesel cars from 2035 by five years, according to a document seen by Reuters.
https://www.reuters.com/markets/europe/five-countries-seek-delay-eu-fossil-fuel-car-phase-out-document-2022-06-24/

#71 Liars on 06.25.22 at 3:42 pm

These guys have exposure to the pipelines and they are trying to make us lift the price

#72 Gino Vanelli on 06.25.22 at 3:50 pm

#69 TurnerNation
There was a new guest blogger yesterday? I’d taken a glance and assumed that one of the other guest bloggers had just transitioned. Forgive me. ‘Tis the season. :-)
—-

Wow TN, and 69th comment!

Let me soundtrack this comment by reminding you all about one of Canadian treasures…me, Gino Vanelli and my song Black Cars. Know what I mean?

https://m.youtube.com/watch?v=1m39piBT2vE

#73 Overheardyou on 06.25.22 at 3:55 pm

Excellent Post Mr. Rowat.

I recently did some napkin math with a 2021 Tesla cost of owner ship for 10 years vs a 2021 Toyota Camry and the Camry came out on top.

What was included in the comparison:
Cost of Tires/Brakes changes
Oil Changes for the camry
Gas for 20000kms/year

FYI EV repairs cost 2-3 times more than an ICE due to the extra certification, parts cost a whole lot more too.

#74 Sail Away on 06.25.22 at 4:10 pm

#67 Bezengy on 06.25.22 at 3:20 pm

But……let me tell you a little story.

Last week we had a meat truck overturn on the highway close to us. Probably carrying 30 k lbs of vacuum packed pork. The cleanup crew quickly unloaded the truck into a dump truck and disposed of it at the dump. One local (let’s call him Robinhood) was able to load his pickup up and gave it all away for free to his neighbours.

——–

Oh, fantastic score! That’s a proper community. Pork chops, pulled pork, pork roast, spare ribs, stir-fry… mmmm… Treasure dropped right in your lap.

Alaska runs a ‘roadkill moose lottery’ that is sort of similar. Everybody was on a salvage team, with division of labour and equipment, and meat shared equally.

https://matadornetwork.com/read/alaska-roadkill-lottery/

#75 tbone on 06.25.22 at 4:30 pm

Think ill stick with my german ICE car for a while .
If it breaks ( hasnt yet except for the massage seat under warranty ) or i need to fill the tank , i will use the dividend income from my ENB stock .

#76 Philco on 06.25.22 at 4:40 pm

At this time EVs do NOT have a smaller carbon footprint then an ICE car. Its a fallacy.
They require 2x the resources than the ICE car.
Approx. 400,000 kms is the break even for the 2 types. Hybrids are better at this time for the least carbon produced. From build to energy consumption to end of life.
I’m on my 3rd EV….Why? Because I was buying them in the US of A a couple years old. Drive them for 2 years and sell them at a profit. Also nears zero maintenance and about $7 charge in my garage for 380kms.
That ship has sailed as shortages and fuel costs have driven the prices way up. The Leaf 64kw batt with pilot pro cost me $25k USD and with 10,000kms 1.5 years old. Original BOS was $55k. Someone took a beating.
Go with a HyBrid especially if you live in -10c or more in the winter.

Do yourself a fav listen to Lance Roberts on Campbell.
He’s bang on. Don’t buy the dip and Bonds will likely outperform stocks this year.
If you owned Peloton and the other clown stocks are never coming back.

#77 SmallTownSteve on 06.25.22 at 5:30 pm

I have an Alberta Hybrid vehicle.
It burns gas AND oil!

#78 Russ on 06.25.22 at 5:44 pm

Sail Away on 06.25.22 at 4:10 pm

Oh, fantastic score! That’s a proper community. Pork chops, pulled pork, pork roast, spare ribs, stir-fry… mmmm… Treasure dropped right in your lap.

Alaska runs a ‘roadkill moose lottery’ that is sort of similar. Everybody was on a salvage team, with division of labour and equipment, and meat shared equally.

https://matadornetwork.com/read/alaska-roadkill-lottery/

==============================

Hey S A

Good resource.

Buck’s RoadKill cookbook, from ’87, is in our bathroom library.

https://www.amazon.com/Original-Road-Kill-Cookbook/dp/0898152003

It is good value and still current if you are out “shopping” with your automobile.

Cheers, R

#79 Dr V on 06.25.22 at 5:55 pm

4 penny

“Just wondering did you factor in the dividends in your
calculations?”
—————————————————

I did not do any calculations, just a comparison of the share price, to see that there looks to be a trade-off with the higher yield with the options. I would expect, over time in a market cycle or cycles, that market efficiencies would lead to the total return of either strategy being
equal. At any one moment though, things could be different.

And I do find it intriguing. If the 7% yield is tax advantaged, continues to grow with the dividend, and the strategy gives a degree of protection to the initial
investment, why not get some? And more liquid than a rental!

#80 Manufactured Landscapes on 06.25.22 at 5:56 pm

The boy on the screen leans against his metal tools in Chittagong, Bangladesh, to the sound of a warped orchestra. He’s dwarfed by the blackened hull of a ship looming behind him. It’s no longer being covered by insurance, so somebody, somewhere, has to take it apart. He got the job.

The hazardous working conditions he endures are propped up by the same developed countries where his photograph might be viewed, as Western shipowners often outsource their shipbreaking to Asian countries such as Bangladesh, exploiting cheap labour and a lack of workplace regulation.

“I think of humanity like a big ship on the ocean,” Canadian photographer Ed Burtynsky said. “This is what we leave in our wake.”

https://www.theglobeandmail.com/arts/art-and-architecture/article-behind-the-scenes-ed-burtynskys-immersive-luminato-film-forces/

#81 Dr V on 06.25.22 at 5:57 pm

29 VI

“Wake up time for the big smokes stuck in the dark ages.”
————————————————————

Yes! It’s a good thing electricity comes from a hole in the wall!

#82 Doug Rowat on 06.25.22 at 5:58 pm

#63 J on 06.25.22 at 3:10 pm
Doug, thanks for sharing your reasoning on investing in Canadian pipeline co’s.

Are you hinting that, for Canadian equity exposure, only owning an ETF that represents the 250 or so S&P/TSX Composite Index companies misses out somewhat on the pipeline upside, and so this should be augmented with a bit more pipeline exposure?

—-

Yes and yes. As I detailed, it’s a sector that deserves to be overweighted.

—Doug

#83 Doug Rowat on 06.25.22 at 6:28 pm

#71 Liars on 06.25.22 at 3:42 pm
These guys have exposure to the pipelines and they are trying to make us lift the price

—-

The market cap of Enbridge alone is $106 billion. I’m flattered you think I have such influence.

—Doug

#84 Dr V on 06.25.22 at 7:05 pm

The covered call explained

https://www.fidelity.com/learning-center/investment-products/options/why-use-a-covered-call#:~:text=A%20covered%20call%20is%20a,stock%20that%20was%20purchased%20previously.

#85 Philco on 06.25.22 at 7:10 pm

Nothing reflects the realities of second and third world countries, where there is little EV charging infrastructure, better than Victoria, Canada.
—Doug
___________
Kanadas EV akin to tossing your tea in the harbour.
Worst G nation on reducing GHGasses.
Its all an utter joke. Thank god T2 crushed the oil patch.

Ive got acres of trees eating carbon. I want a G Dam carbon cheque please 2dough lol

#86 millmech on 06.25.22 at 7:13 pm

#29
Where are you going to get the minerals for the battery, it is next to impossible to get environmental approval for a mine, you see how the Fairy Creek protesters are shutting down Vancouver over a couple of trees that grow back.
What do you think they will do when you have to cut down swathes of forest to strip mine for the metals, non stop protests.
Next you will need First Nations to settle and once your done with them(years of litigation paid for by you) the “Hereditary Chiefs” will come out of the woodwork and will want their cut too.
Guess who is getting all the rights to rare minerals in the world lately, Russia and China, so we will beholden to them as well
If one gets this far and starts to mine and produce the batteries who is going to recycle the toxic mess that it creates, will you have one of those “toxic islands” in your industrial area. We can not even recycle paper and plastic properly and now you will need to find a safe way to deal with all the byproducts.
Who will work in those plants the average life expectancy for the workers after retirement is six pension cheques, so that is a big nope for anyone with a brain in their head(and that is where lead accumulates). Who would want to take on the liabilities of owning a battery recycling plant and which cities would want them as they are nightmares of litigation.
There will be metal dust along with arsenic and cyanide, all the acids will have to be purified creating more bad stuff for the planet.
You can only park an electric vehicle on the street because they have been known to go up in flames as well. Here is a video of an electric bike that caught on fire
https://www.castanet.net/news/Penticton/372250/Penticton-Fire-Department-investigating-e-bike-that-burst-into-flames.
Check out this one, imagine that going up in your garage, you may need a special insurance rider to just park your car in your garage
https://www.ibtimes.com/tesla-fire-kept-reigniting-took-4500-gallons-water-put-out-firefighters-3550046

#87 Philco on 06.25.22 at 7:16 pm

Now that fuels EXPENSIVE its going to cost ALOT more to dig your EV out of the ground and make those plastics to put that puppy together.
Brilliant stuff.

#88 Sharon on 06.25.22 at 7:23 pm

Ron, this is the BS that is still around. The RRSP is at least 18% of gross income so why is not the TFSA contribution not at least restored to $10,000 when the conservatives did that until Trudeau Liberals cut it half and raised a little to $6,000 now. The TFSA levels the playing field tax wise for interest paying, compounding investments. The big mistake is many use it as a savings/spending tool taking money in and out account and not as to accumulate money in it with at least compound interest. An extra $5,000 a year compounded over 30 years or more can make a huge difference, hundreds of thousands of dollars per spouse, adult family member in retirement.

This is why Canadians will never be in a better financial position as they are all debt junkies and real estate junkies with no balance of having no to little financial assets, investments.

#89 Gr on 06.25.22 at 7:34 pm

So this unelected so-called leader wants people to ‘feel pain’. But first have the people even signed up for the S&M session, I know I have not. And what is the safe word anyway? You know to make it stop, I’m sure some people want to know.

So it seems it is trickle down gain for ‘them’, and trickle up pain for the rest of us. Including inflation, party due to printing to much money. Good job IMF and FED, tell us more about the temporary inflation and how it’s not party your fault at all LOL.

-The United States may have to endure economic “pain” in order to rein in rampant inflation, the head of the International Monetary Fund (IMF) said on Friday,
https://www.rt.com/business/557785-imf-us-inflation-pain-price/

And if your old enough to have seen what inflation can do to families lives, even if you’re lucky enough at the moment to be able to deal with the increases in cost of goods, and dog forbid availability of even food to feed you and your family.

So if your old enough to remember inflationary times I think you could be excused for worrying about the future and if your money will run out before you do.
I can’t imagine the extra anxiety and stress people are feeling Now, who Were just getting by living pay check to pay check just to make ends meet.

What is going to happen if they get laid off due to a economic slow down that could happen as they raise interest rates and keep printing money. Or the next mortgage renewal, let allow the cost to fill the car tomorrow.
The plastic credit card is a debt slave trap if you’re not able to pay it off each month. They sure make it sound so easy to sign up for there plastic credit cards don’t they.
But this might just be part of the ‘pain’ the IMF mention in above link.

Just wait until they tell you you have no more carbon credits left to do or buy that. But they still will be flying around in there private plans burning jet fuel. They will own almost every thing and be happy. Remember they said everyone ells will own nothing and be happy. And if your not happy you can guess what then I’m sure.

-US Federal Reserve Chair Jerome Powell on Thursday vowed to do whatever it takes to tackle inflation but admitted he can’t control some cost spikes, including food and prices at the pump.
https://www.rt.com/business/557754-us-rising-food-energy-prices/

#90 Philco on 06.25.22 at 7:36 pm

#81 Dr V on 06.25.22 at 5:57 pm
29 VI

“Wake up time for the big smokes stuck in the dark ages.”
————————————————————

Yes! It’s a good thing electricity comes from a hole in the wall!
—————
Lol ya easy peazy.

VI distance batt size isn’t the issue.
So many places cant instal charging station. You got a garage?
My relatives in the UK in their town have 2 chargers. All the old homes cant support or provide EV infrastructure.
Their windmills went silent then they WERE in the shit.
Bird kill and all the other issues and smoking high prices per KW.
Im an engineer and I know what works and what doesn’t.
Its area specific.
Most are completely completely clueless on the subject.

#91 Truer Words on 06.25.22 at 7:37 pm

#66 Doug Rowat on 06.25.22 at 3:17 pm

Nothing reflects the realities of second and third world countries, where there is little EV charging infrastructure, better than Victoria, Canada.

—Doug

======================================

Great comment. There cannot be anywhere in the country more disconnected from reality than Victoria.

#92 Ohm on 06.25.22 at 7:48 pm

Great post Doug! EV’s, maybe one day once if they find a way not to destroy so much plus get on board with utility companies to DRASTICALLY upgrade the infrastructure without starving us to death.

It will take time but we are NO where close to it.

Anybody that believed that oil was dead; well, I have no words…

#93 EV observer on 06.25.22 at 8:10 pm

#52 tc-contra
But hey, who cares about the real facts – it’s trendy to drive an EV because it messages the world that they’re a ‘caring’ human (just like wearing a mask, alone, in their car
—————————
Made me laugh.
—————————
Wait til many people are charging EVs in older neighbourhoods where power grids are not updated. Especially in a heat wave competing with air conditioners.
One will need a gasoline powered generator in the event of blackouts, which will be happening more frequently.
Or imagine the line ups at charging stations when more EVs on the road.
Don’t get me wrong. I test drove an EV and loved it!
But declined to purchase because we are not ready for EVs
https://youtu.be/sytWLB4-W-M

#94 EV observer on 06.25.22 at 8:17 pm

Gravitas Plus: The dark side of electric vehicles
Check this out:
https://youtu.be/RFHvq-8np1o

#95 Dr V on 06.25.22 at 8:20 pm

Here’s a list of regulated pipeline companies

https://www.cer-rec.gc.ca/en/about/who-we-are-what-we-do/pipeline-companies-regulated-cer.html

Interesting how they have two groups. Have to do some cross-referencing with the TSX. I note CNQ and Pembina are in group 2. Enbridge is listed in both groups.

#96 Phylis on 06.25.22 at 8:22 pm

Thought of a comment for the other day.
As for inflation, who did you think was going to pay for covid, the government?
And for electric cars, don’t they have to have beefcake suspensions and manly tires? These things will always make them cost more.

#97 VanIslander on 06.25.22 at 8:30 pm

To add to my last comment. I was taking a cab to pick up my car and the cabbie and I started talking EV’s as his cab was fairly new. He starts counting 5 Teslas within 3 short blocks. Even I was blown away how many EV’s are in Victoria.

Remember during Covid lockdown when the sky was suddenly was so blue and never looked clearer? Yup , way fewer cars on the road spewing fumes.

#98 Flop… on 06.25.22 at 8:38 pm

Went to Fort Langley for the day.

A train came through town and we had to wait around 5 minutes for it to pass through at the pedestrian crossing.

First hundred or so carriages I said, yeah oil.

Back half of the train I said, yeah grain.

Got an email from my employer yesterday telling staff that there is only 2 EV chargers and they are only for official work vehicles.

Please don’t charge your own personal vehicle when you come to work.

Also, please don’t use extension cords from the charging station to your personal vehicle, as this can become a fire and tripping hazard.

People feeling sick that they’ve been duped, is that why they call them green vehicles…

M48BC

#99 J Drake on 06.25.22 at 9:16 pm

250,000 km of $2.00/l gasoline = ~ $50,000

250,000 km of BC Hydro electricity 0.14/kWh = $6,000

EV’s batteries are warrantied to 160,000km. And unless it is a first generation Leaf, the batteries don’t seem to be an issue.

Fuel and maintenance savings on an EV are really significant.

#100 Electric avenue on 06.25.22 at 9:20 pm

Electric vehicles are great. They’re trendy, fast, quiet

Trendy. Like those white, faceless, non-descript model 3s that are all the rage amongst the millennial generation. No thanks, I think I’ll pass.

Fast. Who really cares? Does that get me where I want to go more quickly. Is it for drag racing on public streets? Impressing one’s friends?
Bragging rights? Is the average person going to “track” it?

Quiet. Yes. Until you get up to speed and then it is essentially no different than an ICE car as road and wind noise make up the majority of noise at this point.

Certainly not the criteria I use for choosing my ride.

#101 Shawn on 06.25.22 at 9:30 pm

Just Buy A Tesla

It’s not about the environment or cost savings. It’s about the cache.

More seriously, if we are at 3% EV already that’s a lot. I think the tipping point is close.

There are dozens and dozens of EVs to choose from.

In a few years most vehicles sold will be electric.

But the oil industry is going to do okay for a long time yet.

#102 Philco on 06.25.22 at 9:53 pm

#101 Shawn on 06.25.22 at 9:30 pm

Why a Tesla? How about a Prius?
Also your simplified answer makes no sence. Like I said most are clueless.
At 20 below they are terrible. You need a battery heater on them if you park outdoors.
It politically driven. EOS

#103 DJT on 06.25.22 at 10:06 pm

Until the Liberals end their blockades on Affordable Alberta Energy the price will continue to trade like Bitcoin.

#104 Victor Llearna on 06.25.22 at 10:12 pm

Maybe Trudeau can finish building that pipeline the liberals bought and turn it into the world’s largest BONG!

#105 Sail Away on 06.25.22 at 10:13 pm

It’s great to read all the EV discussion and deep insights, thanks.

Next, I’m heading over to Reddit for parenting insights from those with lots of ideas, but without, you know, kids.

#106 Sail Away on 06.25.22 at 10:19 pm

#101 Shawn on 06.25.22 at 9:30 pm

Just Buy A Tesla

It’s not about the environment or cost savings. It’s about the cache.

——-

Cachet, Shawn, cachet.

Cache is where we store extra moose meat.

By the bye, how’s the Y?

#107 T Rex and the dinosaur clique on 06.25.22 at 10:27 pm

The Vatican City, the only country in the world with a zero birth rate and no female citizens, just held a four day “family” event where they celebrated the end of Roe v. Wade.

You just can’t make this stuff up….

#108 Philco on 06.25.22 at 10:34 pm

#99 J Drake on 06.25.22 at 9:16 pm

Only reason I bought one cheap and used. I never buy new vehicles…
Peeps waist zillions on autos a depreciating asset.

#109 In Flat Ion on 06.25.22 at 10:41 pm

https://en.wikipedia.org/wiki/Rocky

Here…this will perhaps make you understand inflation.

Budget $960,000
(equivalent to $4.83 million in 2021)

Box office $225 million
(equivalent to $1.07 billion in 2021)

This is what 45 years have done to a dollar.
$5 today buys what $1 used to.
What a scam inflation is. The perfect scam in fact.
No where to hide. No where to run.

#110 Dragonslayer on 06.25.22 at 10:47 pm

Doug, my friend, you are so spectacularly wrong on EV. Ignoring the Victoria area (a hotbed of EV interest) BC as a whole is now sitting at 13% EV market share, and rising. Wait till the Rivians and Tesla trucks hit the market in force.

With abundant Site C hydro in the works (not a Liberal but a tip of the hat to them for that decision) supply of electricity should be fine for the foreseeable future. What could be cleaner than zero emission cars being powered by hydro?

I see that most of the EV sales are in Quebec and BC for now so perhaps you haven’t caught the buzz yet, but it’s coming, and sooner than you think.

#111 Cars on 06.25.22 at 10:52 pm

#99 J Drake

250,000 km of $2.00/l gasoline = ~ $50,000

250,000 km of BC Hydro electricity 0.14/kWh = $6,000

>>>

You can do way better than 10L/100 today.

Most people own the car for 3 to 4 years.

Meaning, if you have a nice efficient car that averages 7L/100 and drive your full 60,000km in 3 years…that is $8400 in fuel. Mazda 3 Sport GS is $26,981. Which electric can I own for $35K for 3 years please?

#112 Shawn on 06.25.22 at 10:56 pm

Cachet

Thank you sail away and right you are.

My model Y is great. Wife loves it. Everyone loves it. Even the dog loves it. Just local trips so far. Only one speeding ticket so far.

This car is a combination of electric, mechanical and software. And it’s really the software that is the value add.

#113 Ponzius Pilatus on 06.25.22 at 11:08 pm

#109 In Flat Ion on 06.25.22 at 10:41 pm
https://en.wikipedia.org/wiki/Rocky

Here…this will perhaps make you understand inflation.

Budget $960,000
(equivalent to $4.83 million in 2021)

Box office $225 million
(equivalent to $1.07 billion in 2021)

This is what 45 years have done to a dollar.
$5 today buys what $1 used to.
What a scam inflation is. The perfect scam in fact.
No where to hide. No where to run.
—————————-
Correct.
Like Rust, Inflation never sleeps.

#114 bdwy on 06.25.22 at 11:16 pm

high prices per KW.
Im an engineer and I know what works and what doesn’t
——
an engineer should use the correct unit of measure for pricing the sparky juice. …per kW*hr . i assume it was a simple oversight in this case.

but SO SO many writers of articles on energy/solar/electricity/batteries in all levels of media/web can NEVER get this straight. Not uncommon to see different variations within the same article.

the energy/time/power relationship uses only simple multiplication (gr4?) but is way way beyond the gen pop it seems.

energy question for the real engineers -without googling – how many kilowatt hours are there in a 100A-hr lithium battery?
…….
diamond dog says 2T to supply all of usa’s energy with wind/solar/batts – with todays tech i’d need about 500k to supply my house of 3 people with off grid electricity as i use it now (with natgas heat). i’d also need a few neighbour’s roofs too. run some math on that and see 20T would not cover canada’s needs. I’d need months worth of battery back up for winter in bc. (near zero direct sun for nov-march) thousands of large batteries . thankfully we have plenty of water and bumpy bits to restrain it out here.

#115 Dr V on 06.25.22 at 11:21 pm

110 Dragon

“With abundant Site C hydro in the works……. supply of
electricity should be fine for the foreseeable future.”
———————————————————

OMG Dragon. Just…..do….the….math…..then see how many GHG emissions you’ll save…… :)

https://www.cer-rec.gc.ca/en/data-analysis/energy-markets/provincial-territorial-energy-profiles/provincial-territorial-energy-profiles-british-columbia.html

…and….

https://ourworldindata.org/emissions-by-sector

I would love everyone to take a look at these and do the quick napkin math. Electrifying the fleet is an unimaginably gigantic undertaking.

#116 T Rex and the dinosaur clique on 06.25.22 at 11:51 pm

Watching everyone selling into this current market downturn, just shaking my head.

Downturns are buying opportunities. You never sell into them. Selling guarantees a loss, every time.

If you look at the historical graphs, they always show the same thing.

Markets go up. They go up in a jagged line, with peaks and troughs, but they always go up.

This downturn is not different from all the others. It will end the same, with another upswing which passes the current peaks.

Someday, the sun will turn super nova, the planet will freeze over, and all life on earth will cease.

At that point, forget everything I said. The market downturn will be permanent. It ain’t never goin’ up again.

Until that happens, don’t sell into a downturn.

#117 bdwy on 06.25.22 at 11:55 pm

With abundant Site C hydro in the works (not a Liberal but a tip of the hat to them for that decision) supply of electricity should be fine for the foreseeable future. What could be cleaner than zero emission cars being powered by hydro?

—————-
best case for sure.

site c ($16-20B)will make 1100 megawatts. about half of hoover dam if lake mead was full but currently making 1300 ish.

bc largest is 2700 at wac bennett.

site c will add about 6% to BC’s total capacity

at 15kw*hr per day for an EV (about 41 miles driven)that should supply 1.76m EVs given perfect timing of charging

with 3.7m vehicles in bc, many larger and doing many more miles we’d need about 3-4 site c dams to cover our transport energy needs

#118 fishman on 06.26.22 at 12:10 am

Pros don’t lend their tools. That trick is for amateurs.

#119 bdwy on 06.26.22 at 12:16 am

45 years have done to a dollar.
$5 today buys what $1 used to.

35 years ago in uni i made 4.50/hr
today my kid is making 26/hr albeit with a better job , lifeguard vs lumberyard ape.
keep upgrading those skills!

45 years ago in Ontario min wage was 2.80ish vs 15 today.
https://tradingeconomics.com/canada/minimum-wages
it all evens out, no?

#120 cuke and tomato picker on 06.26.22 at 12:20 am

Number 110 DRAGONALAYER right on Victoria B.C. has
numerous Teslas. Our son has one he bought new in July
2021 and waited till Oct. 2021 for delivery. He is very happy with it and has driven all over Vancouver Island without any problems.

#121 Diamond Dog on 06.26.22 at 12:58 am

Electric vehicles are great. They’re trendy, fast, quiet. And they allow you to have cool conversations with your friends about how visionary Elon Musk is. But they’re not even coming close to taking a bite out of global oil demand. – Doug

That’s how it is today, sure. But if you look world wide at the number of auto manufacturers introducing EV’s next year in the market place, it’s not hard to see where the marketplace is going.

Take for example, General Motors. General motors had total sales of 2.9 million cars & trucks in 2019, 2.55 mil in 2020 and 2.27 mil for 2021. They are looking to sell 200k in EV’s in 2023, 300k fo4 2024 and 1 million for 2025. Do they need to sell a million EV’s for 2025? They do if they wish to keep pace with competitors:

https://www.youtube.com/watch?v=ldzdz9UvLjI

Let’s look at Ford. Ford sold 1.7 million cars & trucks in 2020. Couldn’t quickly find 2021’s production, but is “probably” in line with global sales, off 13% from 2019. Ford has 200k in orders for the F-150 Lightning and looks to produce 150K next year:

https://www.youtube.com/watch?v=85ibN4wg7Fk

We should be careful about future predictions obviously, but Ford’s CEO is predicting 2 million EV’s produced in 2026, more than their total production in North America in 2020:

https://www.youtube.com/watch?v=YBxV7QkQ8r4

Globally, 15% of China’s auto production was EV’s in 2021. We should not be surprised to see 50%+ EV sales by 2025. European auto manufacturers are pushing to go 100% EV by 2025 with gas cars off the streets by 2030. Keep in mind as well, that global auto sales were also down 16% in 2020 and marginally up only 3% year over year in 2021:

https://en.wikipedia.org/wiki/List_of_countries_by_motor_vehicle_production

These numbers above indicate a compression of the lifespan of used vehicles creating pent up demand for new ones. Filling that void is future EV’s. Considering refining constraints, the cost of gas and oil companies for various reasons (for one anticipating increased EV market share) not spending more on R & D with current profits, the price of gas could stay strong at the pumps into EV’s increasing market share.

The argument for world oil consumption lasting longer than tech enthusiasts would anticipate is twofold, increased use in manufacturing (plastics, composites etc.) & longevity of existing gas and diesel burning cars & trucks. (half life of 8 years) In other words, oil isn’t a one trick pony (66% is used in transportation, the rest in industry and plastics.) and it will take time for EV’s to pass 50% or more of all cars and trucks on the road. (2030 at the earliest globally)

An as of yet the unrealized factor is political will. It’s there in Europe and China, but it may not be in the U.S. . Essentially, old and new economies are walking a tightrope of how commodities respond to changing market share and under/over development and the U.S. keeps ramping up production.

Here we are, managers and investors alike looking ahead and trying to understand the timelines, predicting where the market is going with everything, commodities & transportation, bonds, currency valuations and changing/converging technologies to name a few. At least, we should be if we remove our biases.

We might think changes in the EV space aren’t coming quickly for example, or look at prices at the pump and with recency bias tell ourselves nothing is changing or phaseouts will take decades but when we look at changes in auto manufacturing over the next 5 years, in the battery space and with autonomous tech, its a different story.

What I seeing is 2023 breaks the ice with EV’s. 2024 gathers momentum. 2025 is the year we see sizable market penetration of EV’s globally in new car & truck sales due to ramped up factory production and conversion of technology coming from improved EV design, improved batteries offering greater range & autonomous driving.

Future EV’s are essentially a computer on wheels, a rigid platform (has to be for battery integrity) with airbag suspension that offers mileage longevity we haven’t seen in the industry before. This tech convergence (autonomous driving, longer range batteries, auto longevity) is coming together in 2025, 2026 and beyond. Best guess is new auto sales EV market share is around 25% by the end of 2025 in North America and accelerates by double digits taking up more than 85% of new auto market share by 2030, potentially ranging from 60 to 100% depending on the will of future U.S. governments.

In Europe and China, market share of new sales accelerates more quickly reaching +50% by 2025 and 100% by 2030. We may just see gas & diesel cars phased out world wide by 2035 assuming the world economy is still a going concern and serious with the phase out of “burned” fossil fuels but time of course political will is not certain and time tells all.

#122 Wrk.dover on 06.26.22 at 8:04 am

Three months back, I cobbled together an ETF with ARX, KEY,PPL and TOU, using 5% of our registered money in total. The other day, I added 1.25% of CCO, the next energy.

Great divvies, except for the CCO.

We ‘invested’ our unregistered dough in a 2022 Civic as an inflation hedge in a presently garaged car we will need much later. Ten Miles per Litre, not gallon! WTH, who needs EV technology with that?

Non-Plussed is correct, buy all things.

#123 Sail Away on 06.26.22 at 8:36 am

#118 fishman on 06.26.22 at 12:10 am

Pros don’t lend their tools. That trick is for amateurs.

———

Haha. It’s a graduated system. Very few reach ‘unconditionally approved’ status… but there are a few. And vice versa.

#124 Phylis on 06.26.22 at 8:39 am

#114 bdwy on 06.25.22 at 11:16 pm
Was it fully charged?
Not an engineer.

#125 Cars on 06.26.22 at 8:46 am

#121 Diamond Dog

Three years to go from 3% share to 25% market share?

No way DD. NO WAY!

I will be very impressed if we even hit double digits…10%.

Where do you expect all the batteries to come from to support 25% share in 2025?

What impact will such battery volume have on environment? Let us focus on lithium mining only.

Will battery quality be impacted with such production volume increase? Not many can scale that steep, that quickly, without quality issues.

And while battery technology exists that increased power capacity while reducing weight and allows for quicker charging and potentially up to 500,000 recharge cycles (far exceeding car life expectancy) these batteries are very expensive. Don’t expect to see them anytime soon. There is no scale production capacity of solid state batteries and no one is using them. And certainly won’t by 2025. Probably not even 2035.

It is so obvious that instead of legislation against ICE these lame-o politicians should be legislating efficiency along with (MOST IMPORTANTLY) weight and size reduction. A light, efficient and very safe ICE car can be made. Why isn’t it?

NO ONE should buy a VW Group product, is my stance and view as you know. In addition to Dieselgate and imcredibly poor dependability and reliability ratings there is the XL1. They did all that research and development toward an efficient light car and what? Nothing! No product for the masses, even if it would use 2L/100km or even 3L/100km it would be an incredible product to put to market from all this research and work. Did they? No way. Never going to do something that stupid. Let’s declare it impossible and shut this idea down!

Let’s do Dieselgate instead!

Bloody VW Group, NEVER will I buy their wares!

#126 crowdedelevatorfartz on 06.26.22 at 8:57 am

@#109 Flat Iron
“Here…this will perhaps make you understand inflation.”

Rocky?

Well if you want to understand inflation and use a Sly Stallone movie as an example of “over the top” try this.

https://www.sonypictures.com/movies/thelordsofflatbush

The Lords of the Flatbush

Sylvester Stallone before Rocky
Henry Winkler before the Fonz.
Jay Leno has a bit role.
Armand Assante has a non speaking role.
A ton of other actors before they “made it”.

Richard Gere was originally supposed to play the part of Chico ( lead actor Perry King’s part) until Stallone and Gere had a physical fight and the director booted Gere off the set.
Gere hates Stallone to this day.

And it was horrible.
Bombed at the box office.

#127 crowdedelevatorfartz on 06.26.22 at 9:40 am

Strange.
Defense Minister and Lawyer Anita Annand has nothing to say…….

https://nationalpost.com/news/canada/canadian-special-forces-operating-in-ukraine-new-york-times-reports

One wonders if the Liberals were burning the midnight oil in Ottawa last night brushing up on the “spin” for this news.

#128 Dharma Bum on 06.26.22 at 10:19 am

#61 Sail Away

Laziness is a vastly-underrated quality of life improver. All I’ve accomplished today is feeding the dogs and three cups of coffee.

Might have some lunch… then maybe a nap in the hammock… unless my wife’s lawnmowing is too disruptive.
——————————————————————————————————-

Bravo!

Now you’re speaking my language!

Time for another coffee.

Hmmmmm….if only the wife would fetch it for me…I’m feeling a bit lazy this morning.

#129 AK on 06.26.22 at 10:41 am

“In reality, electric vehicle penetration of global vehicles owned sits at only about 3%.”
================================

According to the eco alarmists (Cathie Wood and that clown on BNN), everybody will be driving one within 5 years.

#130 Ponzius Pilatus on 06.26.22 at 11:33 am

#124 Phylis on 06.26.22 at 8:39 am
#114 bdwy on 06.25.22 at 11:16 pm
Was it fully charged?
Not an engineer.
————————
Not an engineer.
That’s a good thing.

#131 Ponzius Pilatus on 06.26.22 at 11:38 am

#123 Sail Away on 06.26.22 at 8:36 am
#118 fishman on 06.26.22 at 12:10 am

Pros don’t lend their tools. That trick is for amateurs.

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Haha. It’s a graduated system. Very few reach ‘unconditionally approved’ status… but there are a few. And vice versa.
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What’s the going rate of suck-up to borrow a hammer from you?

#132 Quintilian on 06.26.22 at 11:59 am

Question for the big minds.

If inflation is running at high single digits, and the best you can expect without unacceptable high risk for curmudgeons, of mid to low single digit returns; would it not be better to just leave your money in a tin can in the back yard, until the CB’s kill the economy with high interest rates?

Capital preservation VS risk, in an environment in which the CB’s have declared war on inflation, with deflation as its weapon?

#133 Philco on 06.26.22 at 12:04 pm

#114 bdwy on 06.25.22 at 11:16 pm
high prices per KW.
Im an engineer and I know what works and what doesn’t.
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an engineer should use the correct unit of measure for pricing the sparky juice. …per kW*hr . i assume it was a simple oversight in this case
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A lazy typer and its asumed in my conversstions.
Whos paying the road taxes? I havent paid any in 7 years…
Wait till they use the vehicle telemetry to track and tax.
But we still need a billion tones of petroleum to pave those roads!
I think it wss 80 barrels of oil to produce an automobile. EVs use alot more as stated. Oils here to stay Gretta.

#134 Doug Rowat on 06.26.22 at 12:06 pm

#116 T Rex and the dinosaur clique on 06.25.22 at 11:51 pm
Watching everyone selling into this current market downturn, just shaking my head.

Downturns are buying opportunities.

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Correct. If you’d bought into every bear market since WWII the moment it becomes a bear market (i.e., down 20% from the high, about where we are now), 12 months later you’d be up on average 22.7%.

—Doug

#135 Phylis on 06.26.22 at 1:13 pm

#130 Ponzius Pilatus on 06.26.22 at 11:33 am
#124 Phylis on 06.26.22 at 8:39 am
#114 bdwy on 06.25.22 at 11:16 pm
Was it fully charged?
Not an engineer.
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Not an engineer.
That’s a good thing.
Xxxx
My office has many, alway fun to chat with.

#136 bdwy on 06.26.22 at 2:29 pm

yes , fully charged

#137 Phylis on 06.26.22 at 4:15 pm

The engineer said you didn’t provide enough information. I didn’t use google.

#138 Phylis on 06.26.22 at 5:07 pm

Now he is going on about cells, modules, packs, cobalt, iron, temperature cycles. I give up. What’s the answer?