Electric vehicles (EV's) are here to stay and are surging in popularity, so EV ETFs are also emerging to fill that thematic fund demand. Below we'll explore the best electric vehicles ETFs to capture this narrow group of stocks in 2023.
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With electric car sales skyrocketing, electric vehicles stocks have been outpacing the broader stock market. Tax incentives for EV owners, stricter emissions standards, government subsidies, charging station rollouts, more efficient battery technology, and a shift away from reliance on fossil fuels will accelerate this adoption of more environmentally sustainable transport.
Analysts doubted Tesla – and the EV market in general – initially, but the company has seen astronomical growth, both in its vehicle sales and its share price. Newcomer Rivian is seeing similar growth out the gate. ARK Invest expects EV sales to reach 37 million by 2024, as battery power becomes cheaper and more efficient, making electric cars more accessible. They state: “According to Wright’s Law, for every cumulative doubling of units produced, battery cell costs will fall by 18%…These cost declines are critical to reaching price parity with gas-powered vehicles, as the largest cost component of an EV is its battery.”
“EVs hit 10% of global passenger vehicle sales, rising to 28% in 2030 and 58% in2040.”
“Price parity between EVs and internal combustion vehicles is reached by the mid-2020s in most segments.”
“Nearly 60% of U.S. households have two or more cars – and many have the ability to install home charging – making them ideal adopters as EV economics, range and recharging options continue to improve.”
The Biden Administration in the U.S. have also explicitly stated the goal of building 550,000 EV charging stations over the next decade, as well as wanting an all-electric federal vehicle fleet. In November 2021, an infrastructure bill was passed providing huge tax credits for EV buyers in the U.S.
Electric car ETFs eliminate the need for investors to try to analyze and pick winners out of the myriad of choices of EV stocks. Some are small startups. Others are blue chip automakers committed to electrifying their product offering. Thematic EV ETFs provide broad exposure to the segment to capture the success of any of the rising stars, such as Tesla, as well as the technology going into these vehicles. Below we'll explore the best electric car ETFs.
The 5 Best EV ETFs
Below are the 5 best electric vehicles ETFs to access the market. Most also incidentally provide exposure to autonomous vehicles (AVs).
DRIV – Global X Autonomous & Electric Vehicles ETF
The Global X Autonomous & Electric Vehicles ETF(DRIV) is one of the most popular electric cars ETFs, with nearly $1 billion in assets. Global X has a solid track record for thematic ETFs such as this one. DRIV delivers global exposure to all aspects of the EV manufacturing process, capturing firms involved in EV components, technology, development, and manufacturing.
Investors should note that DRIV provides comparatively more exposure to EV and AV technology (fuel cells, drivetrains, sensors, batteries, mapping technology, etc.) than pure EV exposure per se. Examples of large holdings include Google, chipmaker Intel, software company Microsoft, etc. That said, familiar EV names like Tesla and Toyota are still in the top 10 holdings.
DRIV caps any individual holding at about 4%, providing roughly equal weighting across its 75 holdings. This fund has an expense ratio of 0.68%.
IDRV – iShares Self-Driving EV and Tech ETF
Unlike the name suggests, the iShares Self-Driving EV and Tech ETF (IDRV) does not solely focus on self-driving EVs. It is very similar to DRIV above but is cheaper and more diversified, with about 100 holdings at any given time and an expense ratio of 0.47%. It's also newer; the fund was incepted in mid-2019 and has amassed a little over $300 million in assets.
Similar to DRIV, IDRV's holdings provide global access to autonomous and electric vehicle manufacturers, driving technologies companies, EV battery producers, EV battery materials producers, and charging and components producers.
HAIL – SPDR S&P Kensho Smart Mobility ETF
HAIL is a broader futuristic transportation ETF from SPDR, providing exposure to “the areas of autonomous and connected vehicle technology, drones and drone technologies used for commercial and civilian applications, and advanced transportation tracking and transport optimization systems.”
The fund uses an equal weighting methodology and has one of the lowest fees in this space at 0.45%. Unlike the previous funds, HAIL's 60 holdings end up being pretty heavily concentrated in the United States at about 82%.
KARS – KraneShares Electric Vehicles & Future Mobility ETF
KARS provides exposure to companies engaged in electric vehicle production, autonomous driving, shared mobility, lithium and/or copper production, batteries, hydrogen fuel cell manufacturing, or electric infrastructure. While this focus is similar to DRIV from Global X, KARS is much more of a pure EV play, with less weight on AVs.
KraneShares has proven competency in Chinese stocks, and that shows here, as 20% of KARS's holdings are Chinese companies. KARS has 60 holdings, an AUM of about $180 million, and an expense ratio of 0.70%. KARS is likely the most targeted EV fund on this list in terms of actual EV manufacturers.
LIT – Global X Lithium & Battery Tech ETF
Another fund from Global X is LIT, which more narrowly targets lithium miners and battery producers. This is basically a broad play on the lithium industry, only one application of which is electric vehicles.
Interestingly, LIT has been around since 2010, and is the most popular fund on this list with nearly $3 billion in assets. It is also the most expensive, with a fee of 0.75%.
LIT's holdings are mostly small, foreign companies that you've probably never heard of, though it is exposed for 20% to the United States, and Tesla is in its top 10 holdings. Other top 10 holdings include Panasonic, LG, and Samsung. In fact, those 4 comprise over 1/4 of LIT's holdings by weight.
Since LIT is a play on the lithium industry, its performance is not very highly correlated with that of the above EV-focused ETFs.
Where to Buy These EV ETFs
All these electric vehicles ETFs should be available at any major broker. My choice is M1 Finance. The broker has zero trade commissions and zero account fees, and offers fractional shares, dynamic rebalancing, and a modern, user-friendly interface and mobile app. I wrote a comprehensive review of M1 Finance here.
Interested in more Lazy Portfolios? See the full list here.
Disclaimer: While I love diving into investing-related data and playing around with backtests, this is not financial advice, investing advice, or tax advice. The information on this website is for informational, educational, and entertainment purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. I always attempt to ensure the accuracy of information presented but that accuracy cannot be guaranteed. Do your own due diligence. All investing involves risk, including the risk of losing the money you invest. Past performance does not guarantee future results. Opinions are my own and do not represent those of other parties mentioned. Read my lengthier disclaimer here.
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The IEA forecasts that global EV sales will accelerate to 14 million units in 2023, rising 35% year on year and reaching a total market share of around 18% of sales.
The IEA forecasts that global EV sales will accelerate to 14 million units in 2023, rising 35% year on year and reaching a total market share of around 18% of sales.
Key Points. Berkshire Hathaway owns a big stake in Chinese EV maker BYD, which handily outperformed Tesla over the last three months. BYD is outselling Tesla in China, thanks in large part to its lower prices.
The two key ways to invest in electric vehicles are to buy the stock of automakers that focus on making EVs, such as Tesla, or buy an exchange-traded fund that invests primarily in companies tied to EVs.
According to Kelley Blue Book (KBB), 2023 will see the arrival of 16 all-new models. Visual Capitalist projects that 134 EV models will be in production by 2024, up from 125 in 2023 and 100 in 2022. Also, the electric segment will be more accessible than ever in 2023 despite the effects of inflation.
For EVs placed into service in 2023, the Inflation Reduction Act extends the up to $7,500 EV tax credit for 10 years — until December 2032. The tax credit is taken in the year that you take delivery of the EV.
S&P Global Mobility forecasts electric vehicle sales in the United States could reach 40 percent of total passenger car sales by 2030, and more optimistic projections foresee electric vehicle sales surpassing 50 percent by 2030.
ARKQ stock has benefited from its large Tesla position with a gain of 17.5% year-to-date, and the average ARKQ price target of $58.56 implies even more upside of 22.8% ahead. As you can see, Tesla is ARKQ's largest position, with a weighting of 13.7%.
QantumScape was founded in 2010 by Singh and backed early by Microsoft founder Bill Gates and auto giant Volkswagen. Both continue to be investors in QuantumScape.
Form Energy Inc., an energy-storage company backed by Bill Gates's Breakthrough Energy Ventures, is planning a $760 million factory in West Virginia, the latest plant announced in the aftermath of President Joe Biden's landmark climate law.
After a tough 2022, investors are wondering if there is any value in the EV space. Tesla (TSLA): Tesla has to be at the top of every EV investor's radar. It's the leader in the space.
EVs and ETFs. If you are interested in exploring an electric vehicle-focused ETF, Fidelity offers the Fidelity Electric Vehicle and Future Transpo ETF ( ).
You can also invest in index funds containing Tesla (e.g., the Vanguard 500 Index Fund (VFIAX) or Fidelity MSCI Consumer Discretionary Index ETF (FDIS).
NIO stock is a risky investment for those with a high tolerance for the potential of market fluctuations. With the current growth of China's electric vehicle market, analysts forecast NIO's stock price will climb if this momentum continues, possibly reaching $1000 per share in the next few years.
NIO Inc.currently has an average brokerage recommendation (ABR) of 1.94, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by nine brokerage firms. An ABR of 1.94 approximates between Strong Buy and Buy.
Americans planning to shop for a new car in 2023 might find slightly better prices than during the past two years, though auto industry analysts say it is likely better to wait until the fall. Since mid-2021, car buyers have been frustrated by rising prices, skimpy selection and long waits for deliveries.
Here's what we recommend. Tesla just did some drastic price cuts. Now is the perfect time to buy your 2023 Tesla Model Y if you are in the market for one. The Tesla Model Y long range is $52,990 as a base price and if you buy it before March 2023, the price becomes $45,490.
The Hyundai Ioniq 5 is our Electric Vehicle Best Buy of 2023. An excellent all-electric compact SUV capable of running for up to 303 miles on a single battery charge, it also has plenty of tech, lots of standard equipment, and great warranties — making EV ownership an attractive proposition.
Buyers can only claim the incentive once every three years, and are capped at income limits of $150,000 for people who file joint tax returns, $112,500 for head of household, and $75,000 for others for the year of purchase. Like the new vehicle credit, dependents do not qualify.
On January 1, 2023, the Inflation Reduction Act of 2022 qualified certain electric vehicles (EVs) for a tax credit of up to $7,500. Based on new IRS guidance, the $7,500 credit was reduced to $3,750 for certain Model 3 deliveries starting April 18.
Experts say an EV battery should last for at least 10-20 years with the proper care and maintenance. For the uninitiated, the lithium-ion battery packs used in electric cars are similar to those used in cell phones and laptop computers, only they're much larger.
Tesla is dominating the US EV market while other automotive giants like Ford, General Motors, Stellantis, Volkswagen and Hyundai are struggling to provide strong competition. But still, we are seeing new players like Lucid Motors, Karma, Fisker and Vinfast entering the US EV space, underlining the market's potential.
The rule establishes a year-by-year roadmap so that by 2035 100% of new cars and light trucks sold in California will be zero-emission vehicles, including plug-in hybrid electric vehicles. The regulation realizes and codifies the light-duty vehicle goals set out in Governor Newsom's Executive Order N-79-20.
Through his holding company Berkshire Hathaway, Warren Buffett only owns one type of ETF: the S&P 500 ETF -- specifically, the Vanguard S&P 500 ETF (NYSEMKT: VOO) and the SPDR S&P 500 ETF Trust (NYSEMKT: SPY).
"Around September or October, the investor can buy the major market index ETFs: SPDR Dow Jones industrial average ETF (ticker: DIA), SPDR S&P 500 (SPY), PowerShares QQQ (QQQ) and iShares Russell 2000 (IWM). And then sell them around the April to May time frame, especially after a nice run-up," Hirsch says.
In 2022, BYD sold the highest number of plug-in cars, but Tesla is #1 in the BEV segment. More than 10 million plug-in electric cars were sold in 2022, accounting for 14 percent of the total car sales globally. Today, we will take a look at the largest manufacturers (automotive groups) of rechargeable cars.
1. Tesla. With a market cap of over $580 billion, Tesla is the largest EV manufacturer in the world. There are various attributes that differentiate Tesla from other automakers, but the most notable is its supply chain.
Forever battery stocks like Solid Power (NASDAQ:SLDP) are headed higher, too. For one, the U.S. Department of Energy just awarded the company over $5 million to develop its technology, “which could significantly help lower the price of EV batteries,” according to Electrek.com.
Tesla Inc. (ticker: TSLA) is the clear EV market leader, but it has been operating mostly free of competition until recently. ... Tesla Competitors: 7 Rival EV Stocks to Buy.
GUANGZHOU -- Chinese automaker BYD is positioning itself to surpass rival Tesla in global sales of fully electric vehicles, in part by scaling up capacity to double its overall sales volume for all types of autos this year.
Form Energy Inc., an energy-storage company backed by Bill Gates's Breakthrough Energy Ventures, is planning a $760 million factory in West Virginia, the latest plant announced in the aftermath of President Joe Biden's landmark climate law.
Researchers at Vienna University of Technology have developed an oxygen-ion battery based on ceramic materials that has a longer lifespan than lithium-ion batteries.
The facility will produce large batteries that will help electric utilities stabilize grids and use more renewable energy. As a subscriber, you have 10 gift articles to give each month.
The 20 analysts offering 12-month price forecasts for Rivian Automotive Inc have a median target of 24.50, with a high estimate of 40.00 and a low estimate of 11.00. The median estimate represents a +82.29% increase from the last price of 13.44.
Much of Rivian's survival is contingent on the company's ability to launch it's second platform, the R2, which is expected to be manufactured in the new Georgia plant starting in 2026.
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Introduction: My name is Duncan Muller, I am a enchanting, good, gentle, modern, tasty, nice, elegant person who loves writing and wants to share my knowledge and understanding with you.
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