With more manufacturers introducing battery-powered vehicles to their lineups as the years go by, the era of mainstream electric vehicle use is almost here. Even though Tesla was one of the first businesses to switch to electric vehicles, automakers ranging from Ford and General Motors to Volkswagen and Hyundai are also preparing to eliminate emissions.
Solid-state batteries and their potential to power future electric vehicles have generated a lot of discussion recently. If you think solid-state batteries are the appropriate investment for you, come learn more about them and how to get in on the ground floor.
Solid-State Batteries: What Are They?
Let’s first discuss why some individuals believe solid-state batteries to be an appealing investment before moving on to the top stocks. Theoretically, solid-state batteries might address a number of issues that lithium-ion batteries present. In contrast to their lithium-ion equivalents, solid-state batteries use a solid electrolyte rather than a liquid one.
This gives solid-state batteries a greater range and a quicker charge time, while also making them lighter and safer. It seems obvious that businesses would be interested in employing them to power EVs given these and other advantages, as they are already utilized in smaller devices like pacemakers and smartwatches.
What is causing the delay, then? The cost of producing solid-state batteries is still high today. The expense of building one big enough to power a car would be too costly to be practical at this time. That being said, the auto industry is still investing heavily in making the solid-state dream a reality.
Purchasing Solid-State Battery Investments
Since solid-state battery manufacturers are still in their infancy, are they a wise investment? This is mostly determined by your own investing preferences and the particular businesses you decide to fund. Remember that the technology to mass-produce EVs using solid-state batteries may not be available for at least ten years.
Be aware that investing in a firm based only on its solid-state battery potential is probably going to be a long-term, speculative endeavor. Despite Hyundai’s $100 million commitment, several development aspirants, including SolidEnergy Systems (SES), have already given up on their solid-state battery projects.
If you do manage to invest in a business that introduces solid-state technology to the EV market in the future, the upside is the potential for a sizable profit. The good news is that many of these firms are still selling at cheap prices because of their extremely speculative character.
It’s also important to keep in mind that many manufacturers of solid-state batteries are now working on other technologies or products, such lithium-based EV batteries. In light of all of these factors, it is crucial to thoroughly investigate any business before making an investment.
Stocks of Solid-State Battery Developers
Only a handful of businesses now stand out as the leading candidates in the fiercely competitive race to create the solid-state battery. These are some names that are unquestionably worth adding to your watchlist if you’re considering investing in solid-state technology.
Solid Power (SLDP)
Solid Power is a relative newcomer to the market, having only debuted on the NASDAQ in December 2021. Before going public, however, the company had already won over several powerful fans. In May 2021, Solid Power enjoyed a $130 million investment backed by major investors such as Ford, BMW and Volta.
QS, or Quantumscape
This California-based EV battery manufacturer has had some significant setbacks despite formerly being a well-liked choice. After shareholders alleged that Quantumscape may have overstated its progress reports, the firm was sued by investors. Even though these kinds of events are never good for a business, some investors are still optimistic about the future.
The reality is that QuantumScape is unlikely to achieve commercial-scale operations until fiscal year 2025, as noted by Alex Sirois of Investors Place. It’s not news. The long-term investment in solid-state EV battery manufacturing remains unchanged.
Panasonic (OTC: PCRFY)
Last but not least, there’s Panasonic, a multinational conglomerate company headquartered in Japan. Back in 2020, Toyota (TM) announced that it would be partnering with Panasonic in the hopes of developing the solid-state EV battery of the future.
Alternative Investments in Solid-State Batteries
There are a few more possibilities to think about besides investing directly in solid-state battery development. One option is to make a direct investment in one of the several automakers that are now supporting solid-state technology research in the aim of incorporating it into their own vehicles in the future. In terms of spearheading the transition to solid-state power, these are a few of the main automakers:
Toyota (TM)
Ford (F)
Nissan (NSANY)
VW (VWAGY)
Although Tesla’s exclusion from the list may surprise some investors, it seems that the business continues to have a pessimistic view of the solid-state battery controversy. “While there are technical reasons why this technology appears to be the holy grail of batteries, the reality is that even if the technology works (which is a big if after 40 years of development), the technology is unlikely to find more than niche opportunities in the market,” explained Gene Berdichevsky, the engineer behind the Tesla Roadster battery pack.
Opting for the ETF Route
The solid-state battery race is still a speculative one, with no guarantees when it comes to which (if any) developers will ultimately succeed. One way to help leverage your risk is to invest in ETFs that track the EV automotive or battery markets. Here’s a list of some ETFs that may fit the bill:
While some may not currently include solid-state battery developers, they’re designed to stay on top of the leading companies in the industry. For some investors, this may mean that they’re likely to pick up on any profitable contenders before they become major news.
