Liontrust Sustainable Investment Annual Review 2021 - International - Report - Page 15
Looking beyond ‘peak car’
Looking to the future, we are again seeking
ways to get ahead of the regulatory and
societal curves in this area, with driverless
cars no longer the stuff of science fiction.
Short-term problems in our auto industry
are well known but we look beyond the
profit warnings of 2018 and trade war
tweets of 2019 to the underlying drivers
of change. Emissions controls have been
an issue for decades but we believe
something more fundamental is at work:
the problem is not should we buy a diesel,
petrol, hybrid or full electric car but rather
whether to own one at all.
The congestion so many of us face in
modern cities is not only unsustainable
from a human tolerance perspective,
it is also an economic waste. A 2013
study from the Centre for Economics and
Business Research estimated the fuel costs,
unnecessary expense and lost time from
city congestion cost the US, UK, France
and Germany 0.8% of GDP a year.
materials and surface technology and
is investing now to close the loop with
recycling in the future.
Another growth area is trains, and we
have added companies including Trainline
and Knorr-Bremse to our portfolios.
Convenience and ticketing are hurdles
to greater train use and Trainline has
significant impact on these. Another way
trains can take market share from aviation
lies in high speed rail, and Knorr-Bremse’s
braking systems can have a key impact on
safety, which unlocks speed.
from traditional internal combustion
engine and powertrain cars to auto safety,
multi-modal transport and trains. For our
own welfare and to reduce the pollution
and heat of the planet, we need to get out
of the model of single ownership cars in
clogged city streets, and this continues to
create opportunities for companies in the
electric transport space.
Overall, we see the
transport sector
shifting focus
Where, then, is the opportunity? If driving
is too energy and time intensive and
dangerous, what is the solution? This is
driving the notion of ‘peak car’, and we
feel analysts are missing what the public is
increasingly realising: driving is no longer
fun or convenient. We have gone from
half of Americans obtaining their driving
licenses as soon as they were able to in
the 1990s to just over a quarter doing
so in 2017. We are moving beyond car
ownership to new mobility solutions.
To capture this opportunity, we are
investing in a wide range of solutions.
We see battery manufacturing as one
such area, where declining prices are key
to future growth. We believe transport
options will proliferate, from electric buses
to microscooters, and favour companies
such as Umicore, which works across
2014
2015
2016
2017
2018
2019
Euro NCAP includes autonomous
emergency braking
Liontrust Sustainable Investment: Annual Review 2019 - 15
