Electric vehicle (EV) stocks have had a rough start to the year due to slowing sales growth in the sector. Additionally, there are now more electric vehicle brands for consumers to choose from as both incumbent automakers and new entrants have entered the market. However, EV stocks still have strong long-term potential.
Let’s look at two Electric Vehicle Stocks which could be the most efficient until 2030.
You’re here
This year has not been kind to the leader in electric vehicles You’re here (NASDAQ:TSLA). The company saw first-quarter revenue decline 9% to $21.3 billion, with automotive revenue down 13% to $17.4 billion. Vehicle deliveries fell 9% to 386,810, while average vehicle sales prices also declined. This led its adjusted earnings per share to fall 47% to $0.45, as the company saw cash outflows of $2.5 billion.
Due to its poor start to the year, Tesla stock is down about 28% year to date. However, Tesla is about more than electric vehicles, and an investment in stock is an investment in the vision of its founder, Elon Musk. The company has several initiatives that could potentially send its stock significantly higher by 2030.
One of the most important initiatives concerns autonomous vehicles and the creation of a fleet of robot taxis. Tesla has long been at the forefront of autonomous driving technology and plans to introduce its robotaxis later this year in August. A fleet of robot taxis would put the company in direct competition with Uber And Lyft, but would give Tesla the big advantage of not having to pay drivers. And when his fleet of vehicles is not in use, Musk has talked about using his computing power for AI inference to add additional revenue opportunities.
The company’s energy storage business, meanwhile, is experiencing robust growth. Musk has long predicted that this business would grow faster than his automotive business, as its utility-grade battery megapacks are used in some of the world’s largest energy storage projects. The company expects this business to grow by at least 75% this year and will continue to grow strongly in the years to come.
However, during Tesla’s latest conference call, Musk predicted that its Optimus robot business could become the largest part of the company. He hopes the humanoid robots will perform useful tasks in Tesla factories by the end of the year, then be ready for sale outside, perhaps by the end of next year.
Tesla has plenty of irons in the fire to drive growth, which is why it’s expected to be one of the top performers in electric vehicles through 2030.
Rivien
Rivian Automobile (NASDAQ:RIVN) the stock has had a rough year, down more than 50% in 2024. Unlike Tesla, Rivian has seen solid growth in revenue and vehicle deliveries so far in 2024. In fact, revenue has jumped 82% in the first quarter to $1.2 billion, while vehicle deliveries jumped 71%. to 13,588 vehicles.
The company’s problem is that it is currently selling its vehicles for less than the cost of manufacturing them. This appears in the company Gross margin per vehicle, which represented a negative $38,784. It also forces the company to burn through a lot of cash, posting negative free cash flow of $1.5 billion during the quarter.
However, Rivian is working to improve this situation by reducing the cost of manufacturing its vehicles. This includes a redesign to reduce the number of electronic control units in its vehicles as well as a search for cheaper alternative materials. It is also upgrading its manufacturing plant technology to improve production speeds. Through this work, the company is looking to achieve a modest gross profit margin in the fourth quarter.
This also works in Rivian’s favor Amazon is its main shareholder, with a stake of more than 16%. The e-commerce giant also struck a deal with the company to purchase 100,000 of its electric vans to be delivered by 2040.
Amazon has been slow to take delivery of these vehicles due to a lack of charging station infrastructure, but it has now completed the installation of 17,000 chargers in 120 warehouses, making it the largest operator of charging stations. private charging for electric vehicles. With the infrastructure now in place, expect order deliveries to begin to pick up.
Given its gross margins and negative cash outflows, Rivian is a speculative stock, but it has the pieces in place to turn profitable and become one of the best-performing electric vehicle stocks through 2030.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool holds positions and recommends Amazon, Tesla and Uber Technologies. The Mad Motley has a disclosure policy.
Prediction: These Could Be the Best Performing Electric Vehicle Stocks Through 2030 was originally published by The Motley Fool
