Electric vehicle demand is only set to accelerate, which will have a massive impact on EV battery stocks. According to the International Energy Agency (IEA), about one out of every five cars will be electric this year globally. Sales are expected to grow by 35% to 14 million this year alone, making up about 18% of the global market. And that’s just the start as global leaders race to put millions of electric vehicles on the roads by 2030. All in an effort to fight back against climate issues.
In the U.S. alone, total auto sales fell 8% year over year, according to Cox Automotive, as noted by Electrek.co. Meanwhile, EV sales were up 65%, surpassing 800,000 in volume for the first time. Then in the first quarter of 2023, EV sales broke another record, passing 250,000 and claiming more than 7% of total U.S. auto sales.
Of course, that’ll have a massive impact on EV battery demand, too. In fact, according to Fortune Business Insights, the global EV battery market could grow to about $98.9 billion by 2029 from $37.9 billion in 2021. All of which could be beneficial for these three battery stocks.
EV Battery Stocks: Solid Power (SLDP)
Source: T. Schneider / Shutterstock.com
Battery stocks like Solid Power (NASDAQ:SLDP) could see higher highs. 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.
Better, 2023 could be a pivotal year for the company as it begins scaling production of its electrolyte powder and looks to deliver its sample EV cells to joint development partners. It also expanded its relationship with BMW in a joint development agreement. It also produced revenue of $11.8 million in 2022, up $9.1 million year over year.
In addition, Needham analyst Chris Pierce sees a bright future ahead for SLDP. “We view SLDP as a well-funded call option on the future of solid-state batteries in electric vehicles. The potential advantages of solid-state battery technology over current Lithium-ion battery technology are readily apparent.”
Global X Lithium & Battery Tech ETF (LIT)
Source: tunasalmon / Shutterstock
Or, if you’re looking for broader exposure to the battery market, you can always pick up the Global X Lithium & Battery Tech ETF (NYSEARCA:LIT), which invests in the full lithium cycle. Some of the ETF’s top holdings include Albemarle (NYSE:ALB), BYD Co. (OTCMKTS:BYDDF), Tesla (NASDAQ:TSLA), LG Chem Ltd. (OTCMKTS:LGCLF), Livent Corporation (NYSE:LTHM), and dozens more, offering solid diversification among top lithium and battery tech names.
It also holds QuantumScape, which “is on a mission to transform energy storage with solid-state lithium-metal battery technology. The company’s next-generation batteries are designed to enable greater energy density, faster charging and enhanced safety to support the transition away from legacy energy sources toward a lower carbon future.”
Source: Michael Vi / Shutterstock.com
QuantumScape (NYSE:QS) could be one of the most exciting battery stocks on the market. At the moment, QS trades at just $7.30 a share. But if it holds the potential that Luke Lango says it has, it could double, if not triple, with patience.
“Just last quarter, the company started shipping prototypes to automakers, and early indications are that they’re working. In other words, QuantumScape appears to have ‘cracked the code.’ It seems it’s made a solid state that will work in a car. Within a few years, QuantumScape should be commercializing those next-gen EV batteries – and printing billions of dollars in profits,” he says.
While QS hasn’t moved the needle just yet with investors, give it time. According to Market Insights Reports, the global solid-state battery market could be worth $21.6 billion by 2029 from $1.17 billion at the moment.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.