Pay Dirt: Capitalizing on the Tesla-fication of Lawn Care

The clock is winding down on gas-powered lawn machines. The early rulers of battery-powered outdoor equipment look to build an edge that isn’t so easily trimmed.






Key Takeaways

 

  • In the fight against climate change, gas-powered outdoor power equipment (OPE) is turning out to be some of the lowest-hanging fruit. Already, 100 US municipalities restrict it, with the entire state of California set to follow in 2024.
  • Two of the market leaders in the new cordless electric OPE segment are Techtronic (maker of Milwaukee and Ryobi) and Makita, established players whose lithium-ion powered hand tools had been on top for years.
  • It’s not easy building a battery-powered machine light enough to push or carry and powerful enough to tackle the great outdoors. While the power gap with gas is closing, run time remains an issue.
  • Chervon’s Ego brand leads a pack of dedicated battery OPE producers from China also vying for global market share.
  • Intra-brand battery compatibility means that the established tool makers have a secret weapon for pressing their scale advantages already sitting in their existing customers’ basements and garages.

Disclosures

 

The “Fundamental Thinking” series presents the perspectives of Harding Loevner’s analysts on a range of investment topics, highlighting our fundamental research and providing insight into how we approach quality growth investing. For more detailed information regarding particular investment strategies, please visit our website, www.hardingloevner.com. Any statements made by employees of Harding Loevner are solely their own and do not necessarily express or relate to the views or opinions of Harding Loevner.

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