RobecoSAM Smart Mobility Equities M2 EUR

Pieter Busscher is Portfolio Manager of the RobecoSAM Smart Materials Equities and RobecoSAM Smart Mobility Equities strategies. He focuses on sustainable growth opportunities in new materials, efficiency technologies, reuse of resources and new mobility solutions. He started at Robeco as a Deputy Portfolio Manager for the Sustainable Water strategy. Pieter became the Lead Portfolio Manager for Smart Materials in 2009 and Deputy Portfolio Manager for Smart Mobility at launch in 2018. Prior to joining Robeco in 2007, he began his career at Credit Suisse Asset Management in Zurich. He studied International Business at RSM Erasmus University and Banking and Finance at the University of St. Gallen and is a CFA® charterholder.

The fund is established in Luxembourg and is subject to the Luxembourg tax laws and regulations. The fund is not liable to pay any corporation, income, dividend or capital gains tax in Luxembourg. The fund is subject to an annual subscription tax ('tax d'abonnement') in Luxembourg, which amounts to 0.05% of the net asset value of the fund. This tax is included in the net asset value of the fund. The fund can in principle use the Luxembourg treaty network to partially recover any withholding tax on its income.

The fiscal consequences of investing in this fund depend on the investor's personal situation. For private investors in the Netherlands real interest and dividend income or capital gains received on their investments are not relevant for tax purposes. Each year investors pay income tax on the value of their net assets as at 1 January if and inasmuch as such net assets exceed the investor’s tax-free allowance. Any amount invested in the fund forms part of the investor's net assets. Private investors who are resident outside the Netherlands will not be taxed in the Netherlands on their investments in the fund. However, such investors may be taxed in their country of residence on any income from an investment in this fund based on the applicable national fiscal laws. Other fiscal rules apply to legal entities or professional investors. We advise investors to consult their financial or tax adviser about the tax consequences of an investment in this fund in their specific circumstances before deciding to invest in the fund.

The fund's sustainable investment objective is to support the transformation and decarbonization of the global transportation sector. The transformation and decarbonization of the global transportation sector and sustainability considerations are incorporated in the investment process by the means of a target universe definition, exclusions, ESG integration, a carbon footprint target and voting. The fund only invests in companies that have a significant thematic fit as per Robeco's thematic universe methodology. Through screening on both Robeco's internally developed SDG Framework and Robeco’s exclusion policy, the fund does not invest in issuers that have a negative impact on the SDGs, are in breach of international norms or where products have been deemed controversial. Financially material ESG factors are integrated in the bottom-up fundamental investment analysis to assess existing and potential ESG risks and opportunities. The fund's weighted carbon footprint will be equal to or better than that of its Climate Transition Benchmark. In addition, where a stock issuer is flagged for breaching international standards in the ongoing monitoring, the issuer will become subject to exclusion. Lastly, the fund makes use of shareholder rights and applies proxy voting in accordance with Robeco's proxy voting policy.

At the end of 2022, the Smart Mobility theme saw many markets witness very strong growth numbers. The first month of the year is traditionally slower and in general 2023 was no exception. Interestingly, if we look at the US market and zoom into California we see that the Tesla Model 3 outsold the Toyota Camry (15% vs 11% market share respectively). After the more recent price cuts of the Tesla Model 3, leasing a Model 3 or a Camry now costs about the same in the US.

Based on transaction prices, the fund's return was 0.97%. Tesla announced significant price cuts across geographies and models. This leads to the company qualifying for IRA incentives and puts it at very attractive price points. Renesas reported earnings and issued guidance well above expectations. The company sees particular strength in automotive-related business. At the same time, the company announced a JPY 50 bln buyback and is considering introducing a dividend after 2023. Analog Devices also delivered strong results and guidance. Auto-related sales are expected to grow, as are multi-year trends in industrial automation, testing and electrification. STMicroelectronics reported strong Q4 numbers driven by automotive and discrete business, growing 38% year-over-year, while the rest of the business performed better than feared. Guidance was increased for the full year. BYD significantly beat the net profit consensus for 2022. It saw strong growth in China of more than 100%. The company is looking to launch multiple new models in 2023, and expanding to production outside of China.

The underlying fundamentals (as reflected by the core themes addressed by the strategy) are very robust. The current tight components supply situation is causing some production disruptions, some of which may persist beyond the end of the second half, but in the meantime support semiconductor companies. Technology companies with strong and sustainable moats remain the focus of the strategy's investments. These companies focus on the development of high-voltage electric, low-voltage electronic and software-managed solutions that enable electrification, connectivity and autonomous driving. Other key enabling technologies include battery management systems, power inverters, 3D sensing, big data communication and artificial intelligence (AI). The strategy will also continue to seek exposure to the EV market as well as to companies helping to develop EV infrastructure worldwide.