Morningstar Investor users sign in here.

Video

Emerging technology stock pick: EVs batteries go mainstream

Will this electric car maker’s partnership with Panasonic pay off?

Mentioned: Lucid Group Inc (LCID), Panasonic Holdings Corp (PCRFF), Panasonic Holdings Corp (PCRFY)


Andrew Willis: In the recent “10 for 2023” report from Sustainalytics, Martin Vezér and Poulomi Sengupta combed through Pitchbook and Sustainalytics to find you the stocks behind your next electric vehicle.

And we’re not necessarily talking about a Tesla or even Ford. With emerging technologies, expect an increase in competition, with the likes of Lucid (LCID) in the electric vehicle space being a great example. After a maiden product launch as recently as 2021, the company is moving fast – already signing a deal with Panasonic this last December to supply its EV batteries.

Getting the Japanese battery giant on board may have been a good move for the new luxury EV entrant. Lucid had to cut its 2022 production from 20,000 to around 7,000 vehicles on supply chain issues, which included a shortage of components and raw materials. The company could also use some help with product and service safety as Sustainalytics assess the firm’s related programs as weak. Safety is a primary growing pain for the electric vehicle industry, as we discussed on the topic of flying EVs. For Lucid, the report suggests regular testing of emergency procedures and external audits, among other precautions.

For such a new company, it is impressive that Lucid has a Product Governance risk rating lower than its EV peers – especially, next week’s company in our top 10. That EV stock has much more business to govern – including stations that give your car a fully-charged battery in only a few minutes.

For Morningstar, I’m Andrew Willis.



© 2023 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This report has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or New Zealand wholesale clients of Morningstar Research Ltd, subsidiaries of Morningstar, Inc. Any general advice has been provided without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide at www.morningstar.com.au/s/fsg.pdf. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Morningstar’s full research reports are the source of any Morningstar Ratings and are available from Morningstar or your adviser. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782.

More from Morningstar

Bank results: the winners and losers
Video

Bank results: the winners and losers

Morningstar analyst Nathan Zaia explains how the banks did and what the future holds.
How to deal with financial stress
Video

How to deal with financial stress

More high-income earners are now also experiencing financial stress. We go through practical ways to reduce it
UniSuper CIO John Pearce on why the 60/40 portfolio is far from dead
Video

UniSuper CIO John Pearce on why the 60/40 portfolio is far from dead

The $130 Billion SuperFund Manager also talks about how he sees risk, his recent investments, and why history isn’t a good guide to the future.
Incitec Pivot: explosive upside ahead?
Video

Incitec Pivot: explosive upside ahead?

Morningstar analyst Mark Taylor believes imminent growth in explosives earnings could lift sentiment.
Why Morningstar see opportunities in coal stocks
Video

Why Morningstar see opportunities in coal stocks

Analyst Jon Mills explains why he’s recently increased fair value estimates for Australian coal companies.
Is the sharp fall in ResMed's share price justified?
Video

Is the sharp fall in ResMed's share price justified?

The potential for weight loss drugs to impact the sleep apnea giant has weighed on the share price, though Morningstar analyst Shane Ponraj thinks...