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Volkswagen to Step Up EV Competition With ID.3 Summer Launch

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Volkswagen AG (VWAGY - Free Report) recently confirmed the summer launch of its new ID.3 battery-electric hatchback. The automaker plans to deliver the 30,000 pre-booked first edition models to customers throughout Europe around the same time.

Reportedly, the basic version of ID.3 will cost €23,430 in Germany after deduction of the environmental bonus offered by the government for electric vehicles, making it less expensive compared with other models such as the Golf EV. Additionally, ID.3 drivers will save about €840 per annum on operating expenses, with no road vehicle tax and lower energy costs.

For the first time, ID.3 features Volkswagen’s Modular Electric Toolkit, also known as MEB platform. Apart from the ID.3, the company is also set to introduce the first electric SUV produced with a neutral carbon balance onto the roads with the ID.4 by the end of 2020. The Volkswagen Group is ready to produce 33 more vehicles on the MEB platform in the next three years.

Volkswagen is also reducing CO2 emissions in the production of the ID. family. While the Zwickau electric vehicle plant uses electricity from renewable sources, battery cells in Europe are made using green power. Furthermore, the company offers its clients a range of options for charging their electric cars with climate-friendly power. For charging at home, CO2-free Volkswagen Naturstrom is available. On the roads, the IONITY joint venture's fast-charging parks deliver 100% eco power, much like charging stations at Volkswagen facilities.

Volkswagen currently carries a Zacks Rank #3 (Hold). The stock has outperformed the industry it belongs to in the past year. The company’s shares have depreciated 18.3% compared with the industry’s decline of 13.4%.

In 2019, Volkswagen shipped 10.8 million vehicles worldwide, up 0.9% year over year. The company is in the process of making a shift to battery-electric vehicles. Its first long-range mass-market BEV, the VW ID3, is expected to hit the roads by mid-2020. In November 2019, the company announced plans to invest more than €4 billion ($4.43 billion) in China in 2020, with approximately 40% of it to be spent on the development of e-mobility.

Volkswagen plans to become the world market leader in e-mobility in the next few years. The company will invest €33 billion until 2024 for the same. Of this amount, the Volkswagen brand will spend €11 billion. Apart from e-mobility, the company looks forward to develop new mobility solutions and make improvements in smart cities and autonomous driving this year. It also plans to achieve 1.5 million EV sales with 30 different EV models by 2025.

Stocks to Consider

Few better-ranked stocks in the same sector are Fox Factory Holding Corp. (FOXF - Free Report) , Blue Bird Corporation (BLBD - Free Report) and Polaris Industries (PII - Free Report) . While Fox Factory sports a Zacks Rank #1 (Strong Buy), Blue Bird and Polaris carry a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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