Johan Van Der Biest
Deputy Head of Thematic Global Equity
Transport is the main cause of air pollution in cities. An estimated 4.2 million[1] premature deaths are linked to air pollution - more than malaria and AIDS combined!
Investing in mobility represents a major strategic opportunity for several reasons. First and foremost, mobility is central to reducing air pollution and greenhouse gas emissions. In addition, around 1.35 million people die every year as a result of road accidents[2]. Mobility in its current form therefore needs to be redefined.
This mega-trend thus offers significant growth potential, fueled by evolving technologies and business models, particularly in the fields of electric vehicles, intelligent transport systems and shared mobility solutions.
Finally, investing in mobility helps to build a more sustainable future, while offering attractive long-term return opportunities for investors aware of environmental and social issues.
Several recent studies, such as Bloomberg's[3]1 on electric cars, confirm the growing importance of mobility as a mega-investment trend. Some studies indicate that global spending on mobility technologies is expected to increase significantly in the coming years, with a particular emphasis on electric vehicles, shared transportation solutions, and smart infrastructure[4].
In addition, demographic trends such as increasing urbanization and changing consumer behavior are boosting demand for innovative, sustainable mobility solutions. These studies provide a solid basis for guiding our investment decisions and capital allocation in this dynamic sector.
We believe that the transition to next-generation mobility creates investment opportunities in electric cars and bikes, advanced driver assistance systems, car-sharing solutions, digital mobility and smart city technologies, among others.
Electric vehicle manufacturers, autonomous driving, cybersecurity... these are just a few examples of the types of activity contributing to the development of next-generation mobility.
We have categorized companies into three main families:
- Cleaner mobility: companies in this category operate in the following areas (non-exhaustive list):
- Safer mobility: this category includes companies active in the following industries (non-exhaustive list):
- And finally, Smarter Mobility, which includes companies that address the following issues (non-exhaustive list):
We see strong growth and development potential in all these key areas. In other words, the new mobility offers investors a wide range of investment opportunities.
Our stock selection process is based on rigorous fundamental analysis, combining traditional financial criteria with ESG (Environmental, Social and Governance) considerations.
To begin with, we apply specific mobility-related criteria, focusing on companies that derive a certain percentage of their revenues from solutions that promote cleaner, safer and smarter mobility.
Secondly, we exclude companies that do not respect the 10 Principles of the United Nations Global Compact and those involved in controversial activities. We also assess companies according to their ability to create long-term value, by integrating sustainability into their business activities and taking into account the interests of stakeholders.
Finally, we take a close look at five fundamental criteria: management quality, growth potential, competitive positioning, profitability and debt levels.
Candriam stands out in the mobility sector thanks to its specific approach and specialized expertise. Our approach is distinguished by the integration of a third essential pillar: intelligent mobility, which is of paramount importance to us. We firmly believe that the most effective way to reduce carbon emissions from road traffic is to adopt viable alternatives.
Since 2011, our international thematic equity team has been identifying emerging trends and proposing innovative investment strategies. Comprising over twenty investment professionals, our team has a solid financial background and in-depth knowledge of mobility-related industries. This combination of skills enables us to carry out an in-depth analysis and select the companies best positioned to benefit from the transition to more sustainable mobility. In addition, integrating ESG into our investment process enables us to select companies aligned with responsible business practices and sustainable development objectives. Finally, our experience enables us to provide our customers with differentiated, high value-added investment solutions.
More and more investors are turning to thematic strategies to increase their overall diversification. Johan Van Der Biest, Co-Head of Thematic Global Equity, and Allan Foll, Fund Manager, explain that thematic investment skills combined with solid financial analysis is a prerequisite for identifying high-tech companies with strong growth potential at reasonable prices.
[1] Source: World Health Organization
[2] Source: World Health Organization
[3] 2021 outlook
[4] Source, Markets and Markets, Reportlinker, Allied Market Research
The risks listed are not exhaustive, and further details on risks are available in regulatory documents.
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