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Top 5 Stocks with Exposure to Self-Driving Cars

Top 5 Stocks with Exposure to Self-Driving Cars

If you were living under a rock for the past couple of years, you probably don’t know how big the self-driving vehicle market has grown. The top tech companies in the world are fighting for dominance in this sector. From Google to Tesla and even ride-hailing company Uber, all are trying to become the de facto leaders of the next generation of vehicles.

However, investors often tend to get lost in the noise created by companies to attract attention. Avoid all the fuss and check out our top 5 stocks that provide you with exposure to self-driving cars.

1. Tesla, Inc. (TSLA)

Tesla is the sassiest firm on our list looking towards an autonomous future. Its CEO Elon Musk is confident about a future while driverless taxis will be taking to the streets. He even promises that there will be several Tesla-made robo-taxis on the street in 2020. While Musk isn’t someone to shy away from making tall promises, regardless of whether he fulfills them or not, his company is one of the biggest names in the car market today.

Top 5 Stocks with Exposure to Self-Driving Cars

Tesla cars already have an Autopilot function which allows some level of autonomy to the users. The company recently announced that it would increase the price of its full-self driving (FSD) system over time, and the first such increase will be effective from mid-August. The term Autopilot is a misnomer because the company’s cars can drive autonomously; they are merely driver assistance systems. However, Musk believes that full autonomy could reach their vehicles by the end of 2019. Musk recently noted that services like Netflix and YouTube might soon come to Tesla cars which would make the autonomous driving experience even better.

2. Alphabet Inc. (GOOG)

Google’s parent Alphabet is engaged in the self-driving revolution. The 10-year old project called Waymo began within Google and went on to become an independent subsidiary of Alphabet during Google’s reorganization. If there is one company that owns the data, the resources, and the patience to create a truly self-driving car, it is Alphabet. It’s a no-brainer- if you want to invest in self-driving tech, Alphabet should be the stock of your choice.

Top 5 Stocks with Exposure to Self-Driving Cars

Notably, Waymo started a limited trial of their self-driving taxi in Phoenix, Arizona in April 2017. The experiment was largely successful, and they converted it into a commercial self-driving car service. Dubbed Waymo One, the service is available to pick-up users with the click of an app. Google’s data proficiency makes it a force to be reckoned with, and its data capabilities will help Waymo do better as well.

What really sets it apart is Google’s DeepMind neural network that trains Waymo cars to detect objects and even predict how other cars could behave on the road. This helps these autonomous cars make better decisions and provide a safer ride.

3. General Motors Company (GM)

The American automaking behemoth couldn’t keep its hands-off self-driving cars for long. It’s subsidiary Cruise works on self-driving technology, and it reportedly intended to hire 1,000 people in 2019 to double its staff and go all-in on autonomous vehicles. Cruise isn’t as sophisticated as Waymo. In 2018, the company faced several issues with its system, including cars stopping for bicyclists that aren’t on the road and an inability to recognize pedestrians.

Top 5 Stocks with Exposure to Self-Driving Cars

Their cars have been behind schedule and consistently missed targets. However, with new hiring announced in March, the company may be taking the next step in overhauling its game. Cruise intended to set up a self-driving taxi service by the end of 2019 way back in 2017. It has already rolled back the plan and decided to work on tests, especially because the taxis will be running on the crowded streets of San Francisco.

It has already partnered with ride-hailing service Lyft to include its autonomous cars in its fleet. Not only this, the firm has tall plans to include Cruise cars in DoorDash’s delivery services. The company was valued at $19 billion during a funding round in May this year.

4. BlackBerry Limited (BB)

BlackBerry Limited is an unusual candidate on this list since it doesn’t have its own self-driving cars unit. However, BlackBerry is aiming to capture a unique aspect of self-driving cars- software. In early 2018, the company reportedly signed a deal with Chinese tech giant Baidu to start developing self-driving car technology together. By the time the Baidu deal was announced, BlackBerry had already partnered with Aptiv, Denso and Qualcomm for its QNX software that could be used to develop autonomous driving technology.

Top 5 Stocks with Exposure to Self-Driving Cars

The Canadian company has invested over $310 million in its QNX project and the government of Canada is expected to invest about $40 million into the project as part of its Strategic Innovation Fund. The company’s tech is designed for fully autonomous as well as semi-autonomous cars and works as a strong and reliable foundation for developing more advanced systems, like Baidu’s Apollo.

5. NVIDIA Corporation (NVDA)

NVIDIA, just like BlackBerry, stands on the other side of the spectrum when it comes to developing self-driving cars. The company collaborated with Japanese automaking giant Toyota earlier this year to support the end-to-end development and production of its autonomous vehicle technology. NVIDIA Drive software is at the core of the company’s love affair with self-driving tech. It uses emerging technology like artificial intelligence (AI) to help cars see on the road and make them learn to drive and navigate in traffic.

Top 5 Stocks with Exposure to Self-Driving Cars

The chipmaker has partnered with 370 different automakers, developers, suppliers and researchers which include the likes of Audi, Mercedes-Benz, Volkswagen, Volvo, and others. It doesn’t just stick to cars but provides autonomous driving to trucks and other commercial vehicles too. All of this is powered by the company’s deep learning and NLP solutions.

Conclusion

Self-driving is the next big thing in the automotive world, apart from green energy tech. However, one must note that despite years of testing, autonomous driving is still not commonplace in the US, or anywhere in the world. The US Congress is trying again to make sense of autonomous vehicle legislation, and this could be helpful in driving the industry further. If you want to invest in companies investing heavily in self-driving vehicles, opt for one of our top 5 picks.

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Viraj loves to write and express his views on anything related to Finance, Crypto, or Fintech. He has been covering Finance & Crypto for more than five years now. He likes Tesla. He also writes on Healthcare, and Technology among other stuff.