Evcarco, Inc.(fka EVCA)

[VortMax]

EVCA To Tap Into $6.7B Pre-Owned Hybrid Market

The COO says pre-owned hybrids, not EV will be the main source of revenue for several years.

Date: Fri, 18 Feb 2011 20:21:06 -0800
From: [e-mail]
Subject: RE: Q&A EVCARCO Business Plan (Vision)
To: xxxx.com

EVCARCOs primary revenue stream: The primary revenue stream over the next few years should be through the sales of pre-owned hybrids, SmartWay Certified pre-own, service, and M&A of dealerships with limited sales of electric cars due to production.

Please let me know if you would to talk over the phone, I'd be happy to discuss the future of EVCARCO.


Thanks again,


Scott O'Neal
Chief Operating Officer
EVCARCO INC.
OTCQB: EVCA

So how big is the pre owned market in the U.S. today, and how big will it be?

1) 254M registered passenger vehicles in the U.S.

2) 40M passenger vehicles or 15.8% are sold as used/year in the U.S.

3) Of the 254M registered passenger vehicles, ~2.5M are hybrids, of which ~395,000 are sold as used/year or about 1100/day

4) The average used hybrid sells for ~$17,000, so $17,000 x 395,000 cars = $6.7B

5) The new hybrid market is expected to grow from 350k units year now, to 900k units/year in 2015, and possibly 1.8M units/year in 2020. This would about double the used hybrid market by 2015 and quadruple it in 2020 to a $25B/year business.

In conclusion, the used hybrid market is roughly 1100 units/day right now, and will likely become about 2200 units day in 2015 and 4400 units/day in 2020. What market share can EVCA get? If they can get only 1% market share, that's about 10 units/day right now, and would grow to 40 units day in 2020. Thats a yearly revenue of $62M if they can tap into the current used hybrid market and $248M in 2020. EVCA plans to open 4 dealerships within 12 months, could they do 10 units/day or roughly 2.5 units/day at each store? I say yes. That is a yearly revenue run rate of $62M/year. Even if the 4 stores come in at half of that, and the revenue run rate is $31M/year just from this segment, that is still good for about 10% net profit or $3M, use PE 20 get EVCA value of $60M then. Of course, the PE would likely be higher due to rapid growth, maybe a market cap of $100M or so. Keep in mind, while used hybrids will be their main source of revenue for several years, its not the only revenue they will have.

http://www.hybridcars.com/news/expert-expect-more-100-hybrid-and-ev-models-us-2015-28579.html