Invest in EV Battery Stocks
Electric vehicle (EV) ownership is on the rise. Not only will this trend benefit EV manufacturers, but also the companies which produce components used in EV production. In this article, we take a look at 2 EV battery stocks which could benefit in the coming years.
Table of Contents
Why Invest in EV Battery Stocks
With the transition to net zero underway, and many nations planning to ban sales of new petrol and diesel powered vehicles over the next decade or so, electric car ownership is set to rise over the coming years.
In fact, by 2030, EV sales are forecast to represent 60% of total vehicles sold globally, up from 14% in 2022. Naturally, this surge in EV sales will benefit EV manufacturers, but it will also benefit a number of industries which produce critical components for the production of EVs.
EV battery companies, which produce the most expensive component of EVs, are an example of businesses which could be set to benefit from increasing EV demand.
The Best EV Battery Stocks to Watch
For those looking to invest in EV battery companies, there are a number of options to pick from. In the following sections, we will take a look at 2 EV battery stocks to watch in 2024.
QuantumScape
Despite EV ownership rising sharply in recent years, concerns regarding battery charging time and driving range remain an impediment to many would-be EV owners. This is where QuantumScape come in.
QuantumScape is developing solid-state EV batteries aimed at addressing both of these concerns and, in 2022, it delivered its first batch of prototypes to EV manufacturers for testing.
The EV battery company has entered into a partnership with Volkswagen (VW), which is also QuantumScape’s largest shareholder. Considering VW plans to significantly scale up its EV operations in the coming years, with more than €180 billion earmarked for investment in EV production, this partnership could bear fruit for QuantumScape when and if it begins commercial production.
However, as the company remains in its development phase, it does not generate any revenue and is consequently a loss-making operation at this stage. Nevertheless, the company claims to have enough cash to see it through until 2025, following a new stock sale earlier this year.
High inflation, rising interest rates and general economic uncertainty have soured sentiment towards loss-making, speculative investments over the last few years. Consequently, although share price surged following its listing in 2020, QuantumScape has subsequently dropped sharply in the stock market.
The fact that QuantumScape is still in the developmental phase means that it is a very risky stock to invest in. However promising its technology sounds, if it fails, the stock could completely lose all value.
Panasonic
The problem with many pure play electric vehicle battery stocks, like QuantumScape, is that they remain in the developmental phase of the business, making them fairly speculative investments.
Japanese company Panasonic is a diversified electronics company, but it produces a large amount of EV batteries. Panasonic is a key battery supplier for EV manufacturer Tesla, and has been for many years, with the two entering a deal in 2014 for Panasonic to produce EV batteries at Tesla’s Gigafactory in Nevada. This deal was subsequently renewed in 2020.
Despite originally being Tesla’s sole supplier, it now shares the responsibility with several other companies, with Tesla also aiming to produce more batteries itself. With Tesla hoping to move an increasing amount of its EV battery production in-house, this may not bode well for the future of this relationship.
However, Panasonic’s knowhow and proven track record of delivering batteries at scale potentially places it in a good position to benefit from an increase demand in the coming years. Indeed, Panasonic has signalled that it intends to build four new plants in North America to achieve their targets for ramping up production by 2031.
How to Invest in EV Battery Stocks
With an investing account from Admirals, you can buy shares in all of the electric vehicle battery stocks highlighted in this article. In order to invest in EV battery stocks, follow these steps:
- Open an Invest.MT5 account and log in to the Dashboard
- Next to your account details, click ‘Invest’ to open the web based MetaTrader WebTrader
- Search for the EV battery stock you want to invest in and click the symbol to open a price chart
- Press ‘Create New Order’, enter the number of EV battery shares you want to purchase and hit ‘Buy’ to send your order to the market!
Investing in EV Battery Stocks with Admirals
With an Invest.MT5 account from Admirals, you can buy shares in more than 4,500 companies and over 200 Exchange-Traded Funds (ETFs) from around the world. Click the banner below to open an account today:
Electric Vehicle Battery Stocks – FAQ
Who Is the Leading EV Battery Supplier?
China’s Contemporary Amperex Technology Co. (CATL) is the largest producer of lithium-ion batteries for electric vehicles in the world, with a market share of around 34%.
Who Is Tesla Battery Supplier?
CATL, LG Energy Solutions and Panasonic all supply Tesla with EV batteries, with Tesla also having started its own battery production.
Is There an ETF For EV Batteries?
The Global X Lithium & Battery Tech ETF is an ETF which focuses on the lithium battery market, investing in companies throughout the lithium cycle, including mining, refining and battery production. Its current holdings include both EV battery stocks examined in this article.
Other Articles You Might Be Interested in:
INFORMATION ABOUT ANALYTICAL MATERIALS:
The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admirals investment firms operating under the Admirals trademark (hereinafter “Admirals”) Before making any investment decisions please pay close attention to the following:
- This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.
- Any investment decision is made by each client alone whereas Admirals shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.
- With view to protecting the interests of our clients and the objectivity of the Analysis, Admirals has established relevant internal procedures for prevention and management of conflicts of interest.
- The Analysis is prepared by an independent analyst Roberto Rivero, Freelance Contributor (hereinafter "Author") based on personal estimations.
- Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admirals does not guarantee the accuracy or completeness of any information contained within the Analysis.
- Any kind of past or modelled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admirals for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.
- Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.
