The Budget laid bare the economic consequences of successive Covid-19 lockdowns. However, not all industries are in decline. In fact, demand for electric cars has soared since the start of the pandemic.
In the first two months of 2021, for example, year-on-year sales of pure-electric vehicles surged 49pc. When plug-in hybrid vehicles are included, electric cars now account for over 13pc of new car sales. This compares to a 6pc market share at the same point last year.
Their popularity is widely forecast to rapidly grow as the UK’s 2030 ban on petrol and diesel cars moves ever closer.
Falling battery prices and improved charging infrastructure could further hasten this process.
Seeking to invest in electric car manufacturers may be the natural response of many investors. However, in Questor’s view, companies that provide ancillary services to the sector may be equally attractive. Halfords is a prime example. It has invested heavily in an electrified future for the automotive industry.
This centres on staff training and the technology required to service electric vehicles. This could provide it with a competitive advantage over smaller, independent garages that lack the required funds or conviction to invest in an electric future while the economic outlook is uncertain.
The company is also banking on rising demand for electrified forms of other transport. By next month, it expects to have electric bike and electric scooter services available in all of its stores. They could allow it to successfully adapt to changing market trends, as increasing environmental concerns prompt consumers to seek cleaner forms of transportation.
Consumer trends are also shifting with regards to e-commerce and at-home services. Indeed, growth in online sales has accelerated during the pandemic. The proportion of total UK retail sales conducted online is now 36pc, which is a 16 percentage point increase compared with a year ago.