An updated edition of the Sept. 29, 2025 article.

The auto industry is changing faster than ever. Electric vehicles (EVs) and autonomous vehicles (AVs) are moving into the mainstream. They are reshaping how people travel and how companies think about the future of mobility. For a long time, Tesla (TSLA Quick QuoteTSLA - Free Report) led the EV story. However, things look very different today. Chinese automakers have become strong competitors. Traditional carmakers are also catching up fast. New EV-only startups are adding even more pressure and giving buyers more choices.

Technology improvements are supporting this shift. Batteries now last longer and charge faster. Their costs have come down, too. This makes EVs more attractive to more people. Fast-charging networks are expanding in many countries. This reduces charging time, which has been one of the biggest concerns for EV buyers.

That said, EV adoption will not move at the same pace everywhere. In the United States, growth may slow. This is due to President Trump’s policy changes, including the rollback of federal EV tax credits. China is also adjusting its support. The government plans to phase out remaining incentives for new energy vehicles (NEVs). It believes the industry is now strong enough to grow without subsidies.

Still, the long-term outlook remains positive. Global Market Insights estimates that the U.S. EV market was worth about $131 billion in 2024. It expects the market to grow to $439 billion by 2034. That is a compound annual growth rate of 13.6%. Globally, the International Energy Agency (“IEA”) expects EV sales to exceed 20 million in 2025, which would be more than one-quarter of all cars sold worldwide.

Autonomous driving is another major trend. Technology is improving quickly. Better sensors, smarter software, and advances in artificial intelligence are making AVs safer and more reliable. Companies like Baidu’s (BIDU Quick QuoteBIDU - Free Report) Apollo Go and Tesla are testing robotaxis in real-world conditions. According to Statista, the global AV market could rise from about $106 billion in 2021 to more than $2.3 trillion by 2030.

For investors, both EVs and AVs offer strong long-term opportunities. These sectors represent growth, innovation and future demand. Our Electric Vehicles & Autonomous Driving Screen highlights companies that can benefit from these trends. Stocks like QuantumScape Corp. (QS Quick QuoteQS - Free Report) , Alphabet (GOOGL Quick QuoteGOOGL - Free Report) and Rivian Automotive (RIVN Quick QuoteRIVN - Free Report) stand out as promising names for investors to consider now.

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QuantumScape is steadily turning its solid-state battery vision into real progress. In June 2025, the company reached a major milestone by introducing its new Cobra manufacturing process for solid-state separators. Cobra is a big upgrade. It is 25 times faster and more compact than the older Raptor system, making it far more suitable for large-scale, cost-efficient production.

Following this breakthrough, QuantumScape moved from development to early customer testing. It shipped its final Raptor-based B0 samples in the second quarter and began delivering B1 samples made with the Cobra process in the third quarter. Several leading automakers are now evaluating these new cells, showing stronger interest and growing confidence in the company’s technology. At the IAA Mobility show in Munich, the company and Volkswagen’s PowerCo demonstrated the world’s first real-world use of anode-free solid-state lithium-metal batteries. These QSE-5 cells powered Ducati’s V21L motorcycle and delivered standout performance, including 844 Wh/L energy density, ultra-fast charging from 10% to 80% in just over 12 minutes and strong discharge capability.

Partnerships remain a key part of QuantumScape’s strategy. In addition to Volkswagen, it signed a new joint development agreement with another major global automaker. It also strengthened its collaborations with Corning and Murata to expand ceramic separator production. Meanwhile, its Eagle Line pilot facility continues to advance, with most high-volume equipment now installed.

QuantumScape recorded $12.8 million in customer billings for the first time in the third quarter — a small but meaningful step toward commercialization. With rising OEM interest and solid technical results, the company is moving closer to making solid-state batteries a commercial reality. QS stock currently carries a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Alphabet’s autonomous driving unit, Waymo, is emerging as one of the strongest players in the global robotaxi race. Waymo began in 2009 as Google’s Self-Driving Car project. It later became a standalone company under Alphabet, giving it the funding and independence needed to scale. Today, it operates the most advanced and widespread robotaxi service in the United States.

Waymo already runs fully driverless Level 4 robotaxi services in several major U.S. cities. These include Phoenix, Los Angeles, San Francisco, Austin and Atlanta. More recently, it expanded to Denver and Seattle. No other U.S. company operates at this scale. Waymo delivers about 250,000 paid rides every week, far ahead of its competitors. The company’s lead comes from years of data collection, simulation and real-world testing. Its cars have driven millions of autonomous miles, giving Waymo a rich data advantage that is difficult for rivals to match.

Alphabet’s financial support has also played a key role. Waymo has received billions in funding for research, sensors, mapping and fleet expansion. It has also partnered with automakers and ride-hailing companies to speed up deployment and access more vehicles.

Waymo recently reached another major milestone. It began offering driverless freeway rides in San Francisco, Los Angeles and Phoenix. It also expanded into San Jose, providing curbside pickups at San Jose Mineta International Airport. This is the first time passengers in the United States can book fully driverless trips that include highway driving.

With strong technical progress, expanding coverage and growing paid-ride volume, Alphabet’s Waymo is positioned at the forefront of the autonomous driving industry. GOOGL stock currently carries a Zacks Rank #2.

Rivian is working to expand its presence in the EV market with a clearer focus on scale, affordability and long-term efficiency. The company currently sells the R1T electric pickup and the R1S SUV, both positioned in the premium segment. While these models helped establish Rivian as a serious EV player, the company knows it needs lower-priced vehicles to reach a wider audience. This is where the upcoming R2 and R3 models come in.

The R2 is Rivian’s next major milestone. It is a midsize SUV expected to launch in the first half of 2026 with a starting price of around $45,000. This is a big drop from the R1 lineup and is intended to target more budget-conscious consumers. Rivian believes the R2 will be its key growth driver. The company expects significant savings from material improvements, new engineering designs and a more efficient manufacturing process.

A major catalyst for Rivian is its partnership with Volkswagen. The German automaker plans to invest up to $5.8 billion in Rivian and its joint venture by 2027. Rivian has already received $3.3 billion and expects another $2.5 billion. This partnership will focus on Rivian’s next-generation electrical architecture and software, starting with the R2.

Rivian is also cutting costs across its current lineup. The second-generation R1 models are expected to lower material costs by about 20%. For the R2, material costs could be nearly 50% lower, with other production costs also cut in half.

With a strategic partner, lower-cost models and a clearer path to efficiency, Rivian is preparing for its next phase of growth. RIVN stock currently carries a Zacks Rank #2.