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The electric vehicle (EV) market has slowed in 2024 but is poised for explosive growth over the next decade. As the global economy shifts to greener and more sustainable energy solutions, finding the best EV stocks to buy will be a strategic move.
One of the significant factors influencing the EV market is the interest rate environment. Lower interest rates can significantly impact the growth of the EV sector. They reduce the cost of borrowing for companies, making it much easier to invest in innovation.
Additionally, lower interest rates make it more affordable for consumers to finance vehicles, further accelerating their adoption. As consumer risk appetite and spending continue to rebound, EV stocks will become an attractive investment opportunity in the years ahead.
Let’s explore the top three EV stocks to buy with lower interest rates in 2025!
Tesla (TSLA)
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Tesla (NASDAQ:TSLA) has revolutionized the automotive industry with its innovative electric vehicle (EV) platform and compelling vision for sustainable transportation. The company’s robust growth trajectory and market dominance make it one of the top EV stocks to buy in 2025.
Tesla’s success since the pandemic can be attributed to several key factors. First and foremost, the company is led by its legendary CEO, Elon Musk. Its commitment to innovation since its founding in 2003 is steadfast, constantly pushing the boundaries of what’s possible. From improving battery efficiency to developing the most advanced autonomous driving platform, Tesla is relentless in its pursuit of excellence. Its advancements in battery technology, particularly its development of the 4680 battery cell, are groundbreaking. This lithium-ion battery will significantly reduce production costs and increase vehicle range, making EVs more appealing to a broader audience. Additionally, the company is focused on scaling its production capacity, with gigafactories strategically located in the United States, Asia, and Europe. Although the company forecasts a decline in vehicle deliveries and gross margins in the 2024 fiscal year, its long-term growth outlook remains intact.
Ferrari NV (RACE)
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Ferrari NV (NYSE:RACE), synonymous with luxury and high performance, is strategically pivoting toward the luxury EV market. In 2025, Ferrari plans to launch its first fully electric vehicle, which could attract a new audience of environmentally conscious luxury car buyers.
Ferrari’s entry into the EV market is driven by regulatory pressures and a desire to stay ahead of industry trends. Led by its visionary CEO, Bennedeto Vigna, he emphasizes that Ferrari’s approach to electrification is focusing on the brand’s unique driving experience. The company’s focus on quality craftsmanship and strong brand recognition make it well-positioned to fill the gap and create the most premium EV driving experience. Moreover, its incredible financial results over the last several years make the company even more appealing. In FY23, revenue increased 17% year-over-year to a record $5.97 billion. Net earnings surpassed $1 billion for the first time, with the company also generating a record free cash flow of $1.33 billion. Its margins have also remained exceptionally strong, and management has forecasted double-digit revenue and earnings growth in 2024.
ON Semiconductor (ON)
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ON Semiconductor (NASDAQ:ON) is a key player in the electric vehicle (EV) supply chain that powers the EV revolution. As a leading provider of semiconductor solutions, ON Semiconductor is crucial in enabling the development and deployment of EVs worldwide.
ON Semiconductor’s products are integral to various aspects of EVs, including power management, battery charging, and advanced driver-assistance systems (ADAS). The company’s expertise in silicon carbide (SiC) modules is essential for enhancing the efficiency and performance of EVs. These materials offer superior electrical properties and are key to powering EVs. ON Semi has remained extremely resilient despite the broad slowdown across these industries. Despite slowing growth in 2023, management is relentless in expanding its production capacity. This includes its recent $2 billion investment in the Czech Republic and its expansion of its SiC production facility in Bucheron, South Korea. With interest rates anticipated to come down going into 2025, ON stock is among the top EV stocks to buy now.
On the date of publication, Terel Miles did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Technology, Artificial Intelligence, Consumer Discretionary, Automotive, Battery, Electric Vehicles, Lithium, Energy, Renewable Energy, Semiconductor, Software
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