The U.S. Government Accountability Office released its latest report today, revealing the failure of agencies to switch to electric vehicles (EVs). President Joe Biden signed an executive order requiring agencies to stop purchasing gas-powered vehicles by 2035. This includes a sliding scale pushing for more EV pushes in the years leading to that.
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According to this report, only 5,500 EVs were bought by government agencies during its 2023 budget year, representing 60% of their 9,500 target. This means the government is running behind on plans to adopt EVs and may miss its target of 100% of light-duty purchases being electric or hybrid by 2027.
What This Means for EV Stocks
If the government, under an executive order, is failing to keep its EV purchasing promises, that’s a bad sign for the EV sector. While the exact reason for this failure is unknown, it could be an indication of government agencies’ weak desire to switch away from gas-powered vehicles. That could also be a blow to investor confidence in EV stocks as Biden’s administration has been pushing consumers to switch away from gas-powered vehicles.
Not that investors needed any help feeling sour about EV stocks. The sector hasn’t been doing well recently with demand for EVs slowing down. That’s resulted in several automakers, such as Stellantis (STLA), Toyota (TM), Ford (F), and General Motors (GM), reducing their EV production plans this year.
What EV Stocks Are Worth Buying?
Turning to Wall Street, a handful of EV stocks carry consensus Buy ratings. These make them more attractive investment targets for traders still looking to bet on the EV sector. That includes Nio (NIO), Li Auto (LI), Rivian Automotive (RIVN), General Motors, and XPeng (XPEV). Of these LI stock holds the highest potential upside at 34.95% and an eight out of 10 Smart Score.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
