September 16, 2012

You can now invest in electric trucks manufactured by Smith Electric Vehicles

With more and more trouble in the Middle East, we know for sure that the price of oil will remain high in the foreseeable future. To be able to sleep at night without worrying about high fuel costs, more and more companies are purchasing electric trucks from the company Smith Electric Vehicles ($SMTH) - a company you can soon invest in yourself when they go public September 21, 2012 postponed.

Smith Electric Vehicles design, produce, and sell commercial electric vehicles to companies like Coca Cola, US Marines, FedEx, and DHL. The largest operator of the trucks today is Frito-Lay with 176 trucks. If you want to buy a vehicle, you can choose between two basic models:
  • The larger Newton (payload 7,400 kg) 
  • The smaller Edison (payload 2,300 kg) 

Source: Smith Electric Vehicles

Each of these models can be individually configured to meet your needs. You can configure the vehicles to deliver mail, transport passengers, deliver cold food, use them as a repair vehicle, and much more. This is an electrical vehicle, so you can drive a distance of up to 150 miles (190 km) before you have to re-charge it. A re-charge will take between 3 and 8 hours depending on the truck model.

Smith Electric Vehicles origins from England where they have existed since the 1920s. The headquarter is located in Kansas City in the US. The production, research and development, sales and service facilities are also located in Kansas City, and outside of Newcastle, England. The plan is to open more sales, service and assembly facilities in targeted urban areas. During the year of 2011, they sold 270 vehicles, and the plan is to sell 380 vehicles in 2012. The company is not yet profitable, they lost $52.5 millions in 2011, and lost $27.3 millions the first six months of 2012.

  • We know that the world sooner or later will run out of oil - this is known as Peak Oil. Peak Oil is a fact, the supply of oil is not endless. The question here is when it will happen? Will we run out of oil in 10 years - or 50 years? The world has to replace vehicles running on oil with electric vehicles (if not someone invents a fancy new energy source). The question is if we need to do it today - or in 10 years? 
  • The price of an electric truck is higher compared with a diesel truck - but the total price may be lower if you include the high price of diesel.
  • Companies today prefer to join the "green movement" and purchase environmental friendly electric trucks, not because they are more profitable compared with diesel trucks, but because they want to communicate to their customers that they care about the environment. 
  • The company is not yet profitable, and a general rule is to wait if we are not sure whether or not the company can become profitable in the future. If it turns out that Smith Electric Vehicles can make money from the trucks, it is often not too late to invest in the company. The famous investor Peter Lynch always said: 
"It's always better to miss the first move in a stock and wait to see if a company's plans are working out."

Source: NasdaqRetailRoadshow