KEY POINTS: EV STOCKS TO BUY AND HOLD
- Tesla has now reached its vehicle manufacturing stride.
- Ford is shifting its focus to EVs and spending big.
- Rivian may have the financial resources to make its goals a reality.
The automobile industry is experiencing a transition from gas-powered cars to battery-powered ones. The current development of transportation has prompted a surge in interest in electric vehicle (EV) equities.
So many new electric vehicle companies competing for a top position as traditional automakers are increasing their EV plans. It might be challenging to determine which electric vehicle stock to invest in and keep.
If you’re looking for buy and hold EV stocks, there are three that you could end up being quite satisfied with in the future.
It’s all too easy to believe that Tesla‘s (NASDAQ:TSLA) spectacular rise has ended, and you’ve already missed out on the profits. Sure, you probably won’t experience the same returns as early Tesla stock investors, but that doesn’t imply the business isn’t still a fantastic long-term investment.
Tesla’s vehicle output is now in full swing, with production up 70% year over year in the most recent three months. That increase alone is remarkable, but it looks even more appealing when you consider that Tesla completed it before launching its newest factory in Germany.
New factory soon
Even better, Tesla will begin producing cars in a new plant in Texas in early April. In fact, during Tesla’s most recent earnings call, CEO Elon Musk informed investors that the firm would increase vehicle shipments by 50% in 2022 compared to 2021.
While other EV firms struggle to get their manufacturing processes up and running, Tesla’s vehicle production grows. With EVs still in their infancy – just 9% of all passenger cars sold last year were electric vehicles – Tesla has plenty of room to grow as it enters new markets.
First, the firm already has one successful electric vehicle on the market, the Mustang Mach-E. They delivered over 27,140 Mustang Mach-E in 2021. But that’s only the start. The company will start shipping its all-electric F-150 Lightning in 2020, and it has 250,000 pre-orders for it.
According to Ford, it will produce 600,000 electric cars by 2023, but the plan is much higher than that. The firm predicts that EV sales will account for 40% of automobile purchases by the end of the decade.
Expanding EV segment
The management of Ford recently split the firm into two separate sections: its traditional gasoline-powered company and its growing Ford EV division. That will allow Ford to concentrate on its new EV offerings, but it also arrives after the firm has committed $20 billion to develop them.
Other traditional automakers anticipate an increase in electric vehicles, due to government incentives and high gasoline prices. Ford had an early entrance into the sector and critical initial orders for F-15 Lightning trucks. That suggests that the firm may be a long-term winner in the EV market.
First, if Rivian can meet its manufacturing targets in the years ahead, the firm could grow in the EV sector. But, according to Rivian, it will only produce 25,000 cars this year. Still, its plant in Normal, Illinois – and a new facility scheduled to open in Georgia – may make 600,000 vehicles in the coming years.
And that’s just the beginning of Rivian’s EV ambitions. Management aims to produce one million vehicles by 2030. Is it feasible for Rivian to reach that goal? Certainly. But investors should keep in mind that right now, Rivian has sufficient cash to support its vast vehicle manufacturing plans.
By the time 2021 rolled around, Rivian had amassed a staggering $18.4 billion in cash. In the coming years, it will be using this money to establish new factories, like the one planned for Georgia.
The company’s all-electric truck, the R1T, and its range-extended model, the R1S SUV, also give it a unique selling point in the EV market. In addition, being a pioneer in the field and an EV-first firm may give it a leg up over other automakers who will be distracted by designing electric cars and gasoline-powered automobiles.
The stock will still have to overcome some significant hurdles. It’s a young electric vehicle firm in an immature industry. Rivian has a lot of risks ahead of it over the next several years.
Rivian has a wealth of cash, cutting-edge EV technology that could begin rolling out in the next few years. It also has the potential to enter the electric truck and SUV markets sooner than some of its rivals. As a result, investors may want to put a little money toward this EV manufacturer right now.