An updated edition of the Sept. 18, 2026, article.

The global automotive industry is undergoing a fundamental transformation as electrification and autonomous driving reshape how vehicles are developed and used. These trends are creating new growth opportunities across the broader mobility ecosystem, from automakers and semiconductor companies to lidar and autonomous-driving technology providers.

EVs Move Further Into the Mainstream

Electric vehicles (EVs) are gaining traction globally as improving battery technology delivers longer driving ranges, charging networks continue to expand and ownership economics become competitive with traditional internal-combustion vehicles. Higher fuel prices, partly influenced by geopolitical tensions in the Middle East, are also improving the relative appeal of EVs.

According to the International Energy Agency (IEA), global EV sales rose 20% year over year to more than 20 million units in 2025, accounting for roughly one in four new vehicles sold worldwide. The IEA expects sales to reach 23 million units in 2026, bringing EVs close to 28% of global new-vehicle sales.

Growth is expected to remain particularly strong in China and Europe. EVs could account for nearly 60% of vehicle sales in China and approach one-third of new-car sales in Europe in 2026.

At the same time, the competitive landscape is changing. Tesla (TSLA Quick QuoteTSLA - Free Report) , which once dominated the global EV market, is facing intensifying competition as Chinese automakers expand their presence with broader product portfolios and increasingly competitive pricing.

Autonomous Driving Opens a New Growth Avenue

Autonomous vehicles (AVs) are becoming another major growth opportunity as advances in artificial intelligence, sensors, cameras, computing power and connected-vehicle technologies make self-driving systems sophisticated.

According to Fortune Business Insights, the global autonomous vehicle market is projected to grow from $3.36 trillion in 2025 to $4.44 trillion in 2026 and reach $41.75 trillion by 2034, representing a 32.3% CAGR from 2026 to 2034.

Companies across the technology and automotive ecosystems are investing heavily to capture this opportunity. Alphabet's (GOOGL Quick QuoteGOOGL - Free Report) Waymo and Baidu are among the companies at the forefront of autonomous-driving development, while suppliers such as Mobileye, Hesai Group and Ouster are developing technologies that could support the industry's transition toward automated vehicles.

What This Means for Investors

For investors, EVs and AVs represent a strong long-term opportunity. They combine growth, innovation and rising demand. Our Electric Vehicles & Autonomous Driving Screen highlights companies positioned to benefit from these trends, including QuantumScape Corp. (QS Quick QuoteQS - Free Report) , Lucid Group (LCID Quick QuoteLCID - Free Report) and Aeva Technologies (AEVA Quick QuoteAEVA - Free Report) .

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3 Stocks in Focus

QuantumScape is making progress in developing solid-state batteries that could improve EV performance through higher energy density, longer driving range and faster charging. The technology has considerable potential, although its commercial success will depend on the company’s ability to scale production efficiently.

QuantumScape has made headway on the manufacturing front. Its fully operational Eagle Line is producing increasing volumes of QSE-5 cells, supporting customer sampling and initial billings. The Cobra heat-treatment process, which is roughly 25 times faster than the previous method, is also helping improve manufacturing efficiency while reducing space requirements.

The company is strengthening its production capabilities through partnerships. Its collaboration with Muehlbauer Group targets a 100-megawatt-hour commercial-scale production line by 2028, while Murata and Corning are supporting other manufacturing processes. These efforts are expected to support its longer-term commercialization plans.

Customer interest is another encouraging development. Alongside existing relationships with Honda and Volkswagen’s PowerCo, QuantumScape is in discussions with two additional top-10 global automakers. Potential licensing agreements could expand adoption and create new revenue opportunities.

While execution risks remain, QuantumScape’s manufacturing progress and growing industry relationships offer reasons for long-term optimism.The company carries a Zacks Rank #2 (Buy).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Lucid, a U.S.-based EV maker, is pinning its growth on its upcoming Midsize platform. Management believes the vehicle could open a market more than eight times the size of the premium niche the company serves today.

Extra capacity at its AMP-2 facility is meant to support the ramp, helping Lucid build more cars, reach more buyers and earn better returns on each one.

Lucid is midway through a restructuring that includes a range of spending cuts as it tries to shrink its losses, and the Midsize has moved from the end of this year to the second half of 2027. The company says that revised schedule is still intact.

Beyond selling cars, Lucid is moving into robotaxis with Uber, Nuro and Bolt. The Uber-Nuro effort calls for at least 35,000 driverless vehicles in the United States, while Bolt plans to put at least 25,000 on the road in European cities. By August 2026, more than 100 test vehicles were already being driven on public roads, and a Bay Area launch is slated for the first quarter of 2027, which would give Lucid a new income stream.

With a larger addressable market from the Midsize and a growing robotaxi pipeline, Lucid is well placed to turn its restructuring into long-term growth. The company carries a Zacks Rank #2.

Aeva is positioned to benefit as autonomous driving and advanced driver-assistance systems demand more capable sensing technology. LiDAR is expanding beyond passenger cars into higher-level ADAS and commercial-vehicle autonomy, which widens the market for the company’s sensors.

Aeva has made steady progress in automotive applications. It has increased shipments of production-intent Atlas LiDAR sensors to Daimler Truck from its automated manufacturing facility. It has also passed the VDA audit for a top-10 European passenger vehicle manufacturer, an important step toward commercialization.

The company is also building traction with commercial-vehicle suppliers. Aeva completed its ADAS development program with Bendix and is now discussing a production supply agreement.

Beyond individual customers, Aeva is embedding itself in the broader autonomous-driving ecosystem. Continued integration of Atlas Ultra with NVIDIA DRIVE Hyperion could open repeatable design-in opportunities as more OEMs standardize around common AV architectures. That may lower the incremental effort needed to win future programs.

With design wins across passenger, commercial and autonomy platforms now moving toward production, Aeva is building the scale needed to become a core sensing supplier in the AV era. Still, converting these programs into sustained revenue will depend on execution and the pace of OEM adoption. The company carries a Zacks Rank #3 (Hold).