When it comes to the fastest-growing industries, the electric vehicle (EV) market is hard to beat. According to a recent study, the worldwide EV industry would increase at a rate of about 30% per year over the next ten years. With this in mind, it's time to start looking for the finest electric vehicle stocks to invest in for the long term.
Renewable energy is becoming a significant focus point, especially now that world leaders have just reached a new climate agreement to reduce hazardous gas emissions. Electric vehicles, in particular, are benefiting from increased investment to expand their availability.
Not only that, but the new carbon credit trading rules are one of the most important aspects of the new agreement. To meet its purpose, the new agreement permits governments and organizations to buy and sell credits. The plan is to attract additional investment into the industry, with some claiming that it might bring in more than $100 billion.
Having said that, one could argue that EV businesses are appealing long-term investments. With the market expected to grow at a significant rate for decades, the fundamental business prognosis for the EV industry as a whole is very strong. Therefore, let’s look at the 5 best EV stocks for long-term investment.
1. Rivian (RIVN)
Rivian is currently the trendiest name in electric vehicle manufacturing. That is understandable given the company's recent public offering (IPO) in early November.
That first public offering was a huge success. RIVN was increased to 153 million shares at a price of $78 per share following promising demand indicators.
RIVN stock is trading near $120 this places the company among the top car manufacturers even before it begins selling a large volume of vehicles.
Additionally, the company's R1T truck and R1S SUV have a significant backlog of orders. It is currently north of 55,000 units.
According to reports, the electric vehicle manufacturer intends to invest in the construction of a battery factory in the United States. Additionally, it may establish a facility in Europe. Given all of this, would you consider adding RIVN to your watchlist?
2. Ford Motor
Ford Motor Company, which is almost a century old, may not be the first name that comes to mind when considering electric vehicle stocks. However, Ford is keeping up with the changes and has hopped on the electric vehicle bandwagon.
Jim Farley, the business's CEO, announced this week that the company has received nearly 200,000 retail bookings for the company's electric pickup truck.
The pickup vehicle, dubbed the F-150 Lightning, is scheduled to appear in dealerships across the country by mid-2022.
Ford is already producing more Mustang Mach-E electric automobiles than gasoline-powered Mustangs. By 2023, the business intends to double its EV output to 600,000 vehicles. This is more than double the quantity of EVs originally intended for that time period. As a result, do you believe F stock has more room to grow?
3. QuantumScape (NYSE: QS)
Many consider QuantumScape to be one of the top long-term EV investments. It does, however, not directly compete with the others on this list. Instead, the company's product, a solid-state lithium battery, can be used to power electric vehicles.
Not only does it power them, but its superior battery technology has piqued the interest of leading automakers. Indeed, the company has expanded its cooperation with a prominent automotive partner in addition to its existing relationship with Volkswagen.
With its product capable of delivering more power while consuming less energy, the EV battery manufacturer has a large market potential ahead of it.
4. Lucid Group
Lucid Group is undoubtedly the most exciting electric vehicle stock on the market right now. Lucid Air, the company's first all-electric vehicle, has been named the 2022 MotorTrend Car of the Year. The prize is in recognition of the vehicle's cutting-edge powertrain system.
"With the longest driving range of any electric car on the market, an EPA-estimated 520 miles, and over 1,100 horsepower, the Lucid Air is a technological tour de force," says Ed Loh, MotorTrend's Head of Editorial.
That is extremely high praise for the company's first models, which are now on the market. The team is led by Peter Rawlinson, a former Tesla 'Model S' Chief Engineer. Additionally, the management team includes former Audi, VW, Apple, Rivian, and Ford employees. Lucid Group appears to be one of the greatest long-term EV stocks.
5. NIO Stock
NIO is a Chinese electric vehicle manufacturer that has outsourced some of its manufacturing to third parties and that offers a pretty unusual battery swapping technology that enables consumers to cut the time required to recharge batteries to a couple of minutes.
NIO is experiencing rapid development in its home market of China and wants to expand into more markets this year, including Norway, which is frequently referred to as Europe's test market. NIO is a fast-growing company that increased its deliveries by 125 percent, and with international markets expected to be added in the near future, growth will likely continue to be significant. It is trading at 6.2 times 2022 sales, down significantly from recent highs. Depending on your objectives, a high-growth NIO with a unique BaaS offering may still be a feasible option.
Before you invest:
Investors should always bear in mind that an industry's growth prospects may not always translate into share price improvements for companies operating in that field. Despite the positive economic outlook, investors may have to wait a long time to see major share price improvements, as industry valuations remain not cheap, despite the recent dip in several EV equities. The electric vehicle sector is cyclical and highly competitive and companies frequently do not operate at a profit.