John Elkann has no doubts: the future of the car is electric. “The 10 largest companies that exclusively produce electric vehicles, which together sold about 1% of the total number of cars registered and a third of the electric ones, were worth a total of more than 1,500 billion dollars at the end of the year,” he pointed out. number one of Exor in the traditional year-end letter to the shareholders of the holding company of the Agnelli-Elkann family. “By contrast, the 10 largest traditional auto groups, which sold most of the remaining 99% of new cars registered, were worth $ 1 trillion. The markets are clearly showing us where the future is headed.”
To power electric cars, however, it will be necessary to find clean and reliable sources of energy in the supply. And in this area too, Elkann has clear ideas about which direction to take. “We believe nuclear power will be key to addressing the triple challenge of reducing energy scarcity, electrifying industrial applications and replacing fossil fuels,” he said. “Since nuclear plants provide reliable and carbon-free energy, they are the ideal complement to intermittent renewable energy sources such as solar and wind …”. Over the course of 2021, he added, ”
This surge in uranium prices made a decisive contribution to the performance of Exor, which had previously invested in the Canadian companies Cameco and NexGen Energy. “March 2022 marked the fifth anniversary of our listed securities investment business led by Matteo Scolari and his team,” recalled Elkann. “Since inception, the portfolio has achieved an overall gross return of 207.1% in dollars or an annualized return of 24.7%, with no negative years thanks to the hedging activity. By comparison, the performance of the MSCI World Total Index Return over the same period was 81.5% or 12.5% ​​annualized (with negative results in 2018 and 2022 to date) “.
Once the sale of Partner Re to Covea for approximately 8 billion has been completed, Exor will go in search of new acquisitions. “At the moment we look particularly at some sectors and themes where we intend to both leverage our experience, such as luxury, and increase our knowledge as in the health and technology sector”, she anticipated. In this research Elkann will refer to the path of the French fashion giant Hermes, one of the companies most appreciated by investors on the stock exchange.
“Emile-Maurice (grandson of the founder) had returned from America where he had seen the rapid rise of the automobile, which was revolutionizing their market …”, recalled Elkann. “So I began to apply the company’s ability to process leather products to produce luggage for automobiles and, in 1922, started with handbags, as his wife complained that she couldn’t find any to her taste. Hermes ever since. it has grown stronger year after year, always under the guidance and control of its founding family. A source of inspiration for anyone leading companies in changing markets. ”
Speaking of transformation, Elkann mentioned the changes in Juventus management with the appointment of a new board of directors and a new CEO, which are essential together with the 400 million capital increase to return to the top of Italian and European football. An industry that Exor considers in need of profound changes including, without directly mentioning it, Elkann imagines the launch of the Superlega. “The difficulties have highlighted the structural weakness of football, in Italy and in Europe”, he remarked. “Andrea Agnelli, Juventus president, supported the reasons for a structural reform and governance of the sector, with the aim of making it more equitable and sustainable for all those who love this sport”.
Finally, a controversial mention of the 746 million maxi-transition recently concluded with the Revenue Agency to close a dispute on tax matters, with particular reference to the Exit Tax due for the transfer of the holding to the Netherlands. “Despite our disappointment at what happened, we remember the wise words of Luigi Einaudi, one of the most important Presidents of the Republic, as well as a journalist for La Stampa and The Economist, who once said:” Thousands, millions of individuals work, produce and save despite everything we can invent to harass them, jam them, discourage them. It is the natural vocation that drives them: not just the thirst for money. The taste, the pride of seeing one’s company prosper, acquire credit, inspire trust in customers… “.
