How Russia’s War Will Worsen the Chip Crisis

Dave Forest: As you know, Chris, I’m all in on EVs. And I’m putting my money where my mouth is on this one.

I’ve been going around the world looking at the best EV opportunities – some that most investors aren’t aware of – linked to the EV space.

So I’m here in Ireland looking at one of the most important hard tech components that goes into making EVs. It’s something that every EV needs… And that’s copper. It’s one of the biggest hard tech components for EVs.

There’s a lot of copper down here. I visited a couple old mines yesterday looking at the potential to reboot them.

Europe’s probably going to be the biggest manufacturing center for EVs on the planet in a few years. So finding those feeders… finding those bottom-stage, early-stage opportunities to feed into the entire EV boom… that’s what this is all about.

Chris: A lot of people, when they think of EVs, think of folks investing in Tesla (TSLA), or maybe some of the Tesla rivals like Rivian (RIVN) or Lucid (LCID) – two other pure EV makers. What is hard tech, and why is that part of the focus here?

Dave: Let me give you a very topical example of that. So Russia’s invasion of Ukraine last week is highlighting an unknown but important hard tech component that goes into EVs.

Hard tech are the base components, the bottom floor, the things that go into every single EV. And Ukraine is one of the world’s largest producers of neon gas.

Now what the heck is neon gas? It’s an element that’s used [in lasers] to etch computer chips. So when you have an assembly line that makes computer chips, you need neon gas. No neon, no chips.

Chips are one of the biggest components of EVs. Every single EV uses about 2,000 computer chips. So, we have this problem. The problems in Ukraine mean less neon… less hard tech… and big problems for EV makers.

But that’s actually a big opportunity because chips are getting more expensive. EV makers are not going to stop. The chip shortage is not going to stop EV makers from pumping out units.

Every EV maker on the planet, whether you’re Tesla… Ford (F)…  Volkswagen… they all need to win this race. This is the trillion-dollar opportunity that everybody’s been waiting for.

They’re going to pay whatever they can to get those chips they need to keep making EVs. Whatever the price, they’re going to pay it. The price may be hefty, especially with these new developments in Ukraine.

So if you’re an EV maker, that’s not great. Your profit margins will probably erode. We could see some big earning surprises for stocks like Tesla and Rivian.

Remember what happened with Facebook when we saw that big earning surprise. We had a pretty big tumble in a single day. We might see some of that in the EV space.

That’s why I’m not recommending investing in EV stocks themselves. I’m recommending the bottom floor, the things that go into every single EV on the planet.

Chips, to me right now, are one of the biggest plays on EVs. Even better, they’re a play that very few investors are aware of. You don’t have a lot of competition if you’re looking at chip companies, but there are some amazing chip producers on the planet. Those are the stocks I think are going to go crazy in the next little while here.

Chris: So you’re hosting an event all about it. It’s called the EV Superboom Summit. For folks watching this, what can they learn from you when they tune in at 8 p.m. ET to hear from you tonight?

Dave: We’ll cover all the important details about what’s happening in the chip sector. What the setup is… how many chips every EV uses… where those chips come from… what the demand is like and how it’s basically skyrocketing as we go from 10 million EVs on the road to 145 million EVs.

Then we’ll zero in on a specific small stock that I think is the number one chip play right now.

It’s a company that’s already producing chips. So this isn’t a startup. This isn’t a future thing. They are producing chips right now. They have a stockpile of inventory, and as chip prices go up with the war in Ukraine – all these things pushing – that’s going to be a gold mine.

Those chips that they’re sitting on are going to be sought by every EV maker on the planet. They’re expecting their profits and revenues to soar because of this. It’s the perfect time to get into this perfect EV investment.

Chris: Well, Dave, thanks for taking the time. I know it’s early in the morning for you. You’re in a hotel. You’re continuing your travels, I believe, after this. You’re heading off to Uzbekistan. Before we go, what’s the plan there?

Dave: Looking at the same thing. So Uzbekistan might be the world’s largest supplier of copper hard tech. They have a bunch of mines that nobody knows about. I’ve been there a couple months ago and had a look at some of them.

I’m so excited I’m going back, and this is part of the world tour. I drove a Tesla across America recently looking at all the opportunities. I’m so excited about this, Chris.

It’s a trillion-dollar opportunity. It’s going to spawn a lot of wealth. A lot of people are going to make a lot of money off this, and I want us to be on the front lines. So I’m going to do whatever it takes.

Chris: We’re looking forward to the summit, and we’ll check in again. Maybe after you’ve checked out that copper mine in Uzbekistan.

Dave: Terrific. I’d love to.

Chris: Thanks, Dave.

Dave: Thanks, Chris