Electric Vehicle Supplier Stocks To Watch Following GM And VW’s Major EV Commitments

Electric Vehicle Supplier Stocks To Watch Following GM And VW’s Major EV Commitments

BRAZIL - 2020/10/18: In this photo illustration the APTIV logo seen displayed on a smartphone. ... [+] (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)



SOPA Images/LightRocket via Getty Images

Our indicative theme of Electric Vehicle Component Supplier Stocks - which includes stocks of companies that make EV components and raw materials for batteries - is up by about 4% year to date, roughly in line with the S&P 500. The theme has also returned about 40% since the end of 2019, compared to a return of about 21% on the S&P 500. While some of the stocks in our theme have corrected a bit in recent weeks, we think the long-term outlook is strong. Mainstream automakers are making big commitments of shifting to EVs quickly and this could help suppliers in the medium term. For example, last week, Volkswagen (OTC: VWAGY) outlined a plan to become the world's largest seller of EVs by 2025 at the latest, with the intention to invest around 46 billion Euros (about $55 billion) to electrify its lineup. Separately, in late January, General Motors - the largest U.S. automaker - announced that it would launch 30 electric