Self-driving car stocks – The Complete investment Guide

12 minutes

While cars are still finding their legs, advocates are anticipating fully autonomous cars. However, according to current technology, it looks different.

The latest group of job automatons to be identified? A rather universal occupation: people around the world are drivers. Automotive players face a self-driving disruption mainly because of the current developments in the industry, and this has people anticipating self-driving cars as the new norm. According to different studies, vehicles that have been improved to the level of being able to function without the assistance of humans are a bit closer to five to ten years away.

What is self-driving car?(Autonomous vehicle)

A self-driving car or autonomous vehicle is a vehicle that can sense its surroundings and can be driven without a human driver. Neither does it need a human driver for driving, nor does it need any human to be present in the vehicle; it can completely be driven automatically. It performs all the functionality that a traditional car can perform, and there isn’t any difference between automated driving and driving by an experienced human driver.

Different Levels of Autonomy

Automated vehicles have evolved through the advancement of different levels of driver’s assistance technology. There are 6 levels of automated vehicles, which are explained as follows:

1.Level 0

Level O is basically about non-automated vehicles or vehicles which are driven by human drivers completely. At this level, there can be some features in the car that can assist drivers in some way, like an emergency brakes system, but as this feature doesn’t include any driving of the vehicle, it is not counted as an automatic feature.

2.Level 1

Also known as Driver’s Assistance, this level includes basic features that assist drivers in driving the vehicle, like cruise control. As this feature involves a human driver to monitor the activity, it doesn’t consider a fully automated feature.

3.Level 2

Partial Driving Automation is known as level 2. In this level, the features that fall under level 1 are advanced, such as ADAS. Vehicles can control the car’s speed also handling but under the supervision of a human driver. Additionally, the driver can take control of the car anytime he/she wants. Examples of Partial Driving Automation are Tesla Autopilot and Cadillac Super Cruise System.

4.Level 3

Conditional Automated Driving is level 3 of vehicle autonomy. Level 3 vehicles have the feature of making decisions to overtake a slow-moving car, but still, it requires a human driver to monitor this in case of system failure. Even for this level, drivers should be attentive while using Conditional Automated Driving. If the system is unable to perform the task, the driver can override it. Almost two years ago, Audi announced the next-gen Level 3 A8 release, and in 2019, they manufactured Audi A8L under the Level 3 category. It has a Traffic Jam Pilot.

Despite having this masterpiece of engineering in the automobile industry, the US government is still classified in Level 2, so for now, this model is being shipped to the US without the necessary hardware and software to perform its full functionality. But, in the coming future, Audi A8L will be launching in Germany with its full features.

5.Level 4

Moving forward towards level 4 vehicles, also known as High Driving Automation, these automobiles have features to automate driving in many situations, but human drivers still can override the vehicle whenever they want. Fully automated driving can be done with level 4 vehicles but within some limitations.

Following are some examples of existing level 4 vehicles around the globe:

  • There are level 4 vehicles in the US that French Company NAVYA is manufacturing. These vehicles can accelerate up to 55 mph and have fully electric-powered engines.
  • Driverless cars are being tested in Arizona for over a year now. Waymo manufactures these cars.
  • Level 4 vehicles are being tested to run in urban areas and on the highways by the combined effort of Canadian automobile suppliers Maga and Lyft. They have developed a technology known as MAX4 to support High Driving Automation.
  • In China, the robot taxi market will grow with Volvo and Baidu Level 4 vehicles in the country.

6.Level 5

Full driving automation technology will feature cars that won’t be requiring any human driver to be present in the vehicle. It won’t even have steering wheels or brake paddles. These cars will be able to drive in the area where every experienced human driver can go. Currently, Level 5 cars are in the testing stage and not available for the general public. However, Full drive automation is the future of the vehicle industry.

Self-Driving Car Industry Potential

In 2021, the autonomous car industry has a market value of $19.46 billion. It is predicted that by the period 2021-2026, the CAGR of this industry will be 18.06%

The progress of the entire automobile industry has been affected because of the COVID-19 pandemic. Because of lockdown, a lot of companies have stopped their testing programs. It’s unlikely that by 2030 Level 4 and Level 5 will be available to use for the general public. Although, there will be a lot of advancement in Level 2 and Level 3 vehicles. These vehicles already have some of the key functions, including collision detection, lane departure warning, and adaptive cruise control. Level 4 and Level 5 cars still have serious cybersecurity concerns, but if these issues are resolved, then it is predicted that the autonomous vehicle industry will reach the market value of $60 Billion by 2030.

To date, automobile industry giants, auto-part companies, and renowned technology companies have invested over $50 billion in driverless cars. Around 70% of the investment in this industry has come from non-automobile sectors. Many public authorities believe that the Automated car industry has a lot of potential and benefits.

The major components of driverless cars are Lidars and cameras. These are the parts that differentiate automatic cars from traditional cars. Lidars’ main purpose is to provide a 360-degree view of the surroundings so that driverless cars can make a decision based on the visuals. Many companies that manufacture these parts are collaborating with automobile industries, making the future bright for this industry.

Check out our other industries coverage

Self-Driving Car Industry Business Model

Driverless cars are the future of the automobile industry. It will change the way we live in our world, and also there will be several job opportunities that come with the development of this technology.

Following are the business models of driverless cars:

TaaS (Transportation as Service)

There are many speculations that transportation will change a lot in the coming future. There are several companies like BMW who make sales with customers directly. These companies are also experimenting with using TaaS business models by ride-sharing, fleet sales, and time splitting.

Operating System-Enabled Value Chain

An operating system is important for any ecosystem. Many companies have their way of monetizing operating systems. For example, Apple makes money for its hardware, Google makes money through advertisement, and Microsoft earns money through direct monetization. In autonomous automobiles, operating system control plays a vital role in establishing a good customer relationship.

Tesla is trying to create its operating system similar to IOS. Baidu is trying to get its sales through open-source technology. At the same time, Uber is partnering with other companies to make their sales. There will be many new markets that will come on the scene in the future to make sales, advertise, and increase the competition.

While there will be a difference in marketing strategy from every company, the growth in the industry will be faster. For instance, Tesla focuses on attractive models and has good build-quality, while Baidu’s focus is on providing good services and products.

Fleet and Logistics

The logistics sector can be improved with the introduction of autonomous cars. This will provide fast delivery of goods, less parking lot occupation, and less work for the logistic companies. The government is already considering using AV for the logistic sector. With the introduction of driverless fleets, technologists will have new job opportunities to handle these fleets. As it will cost a lot to manufacture fleets with a driverless feature, semi-autonomous vehicles can be part of the logistic industry in the short-term.

Data-Driven Value Chain

It will be very helpful to collect data with the use of driverless cars. Several Level 5 vehicles can collect data through Cameras, GPS, sensors, maps, radar, and lidars. This data can help study the route, obstacles, environment, drive-time, and rules and regulations of a certain highway. Companies will be using this data to improve the effectiveness and efficiency of next-gen vehicles. The collection and usage of data will open new windows for various software-design companies, new technicians, and analysts to form an infrastructure to use this data. There will be many new companies that will emerge just based on this data.

Software-Defined Value Chain

Technological companies have a huge role in the automobile industry. Ridesharing companies like Uber and Lyft are using these channels to entertain their customers. These companies’ primary focus is to invest more in the autonomous vehicles industry to be known as the first transportation company to use this feature. Several companies like Google and Tesla are becoming a part of this industry. As there are many electric cars introduced to date, they affect the cost of manufacturing AVs directly. The future generation of vehicles will also be faster, safer, cheaper, and more efficient in every way.

How To  Invest in the Self-driving car industry?

There are many ways to invest in autonomous vehicle, but we are going to focus on the following:

Stock Investment

You can invest in any model of self driving cars through stock investment. It means that you can buy shares of a particular company that you think has the potential to grow in the future. In this way, you will be making a profit from the company as the company grows. You will also become a shareholder or partner of the company after you invest in one. You can explore all the most relevant Driverless stocks via eToro Self Driving cars stocks breakdown 

Top online stock platforms

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Self Driving cars Pre-IPO

Pre- IPO (Initial Public Offering) is investing in a company by  units of stocks. The companies offer this selling of the stocks before the stocks are made public. Because you will be buying huge blocks of stocks, it means more risk is involved in this. That’s why companies offer a discount for the buyers in Pre-IPO placement.

You can Invest through trusted online pre-platforms such as Equitybee, Sharespost, and EquityZen

Investing in pre IPO companies is risky yet beneficial. If you choose wisely and make the right investment, you can make huge money through pre IPO investment.

Driverless Copyportfolio Investment – Self Driving Cars alternative funds

Copyportfolio is one of the premium services by eToro. This is an advanced version of copy trading. The Driverless Copyportfolio by eToro is specifically designed for investing in self driving. The main aim of this is to reduce the risk and benefit the current market. The Copyportfolio is rebalanced every quarter to adapt to the best investing strategies. Each instrument in Copyportfolio is counted as a single trader, and each trade depends on the percentage of funds you have. It is similar to copying another trader. 

The minimum investment starts from $1000, invest in eToro self-driving funds today.

Interested in CopyPorfolios?

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Autonomous Vehicle Industry investment  Returns

By the end of 2020, eToro “Driverless Car” yielded a 71% profit. This is a consistent number, when compared to an average 26% gain year return during the 2016-2020 period.In accordance with analysis, this number is expected to be increased in 2021.

Summary

Self-driving cars are becoming more popular. Since the time the automotive industry reached Level 3 autonomy, automated cars have gotten one step closer to being capable of full-vehicle operation. There are several ways to invest in this industry, of which stock investments are preferable: Pre-IPO platforms and  Copyportfolios.

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