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Component Makers Of Electric Car Models Get A Bigger Thumbs Up From Investor

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The latest trend in the car market is the use of electric cars and self-driven cars. They are proving to be strong contenders to the conventional fuel run cars. The electric car has been around in the automobile market for almost half a decade now and the rate of growth is constantly on the rise. In spite of being strong contenders in the automobile, market investors believe that component suppliers of these cars enjoy a more advantageous position and will be the first winners from the technology shifts.

Component makers of electric car models get a bigger thumbs up from investor

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Aptiv, Valeo, and Continental are some of the biggest car part suppliers to car brands like Volkswagen, Daimler, and Peugeot. It is clear indication that these suppliers have evolved and are continually coming up with new innovations to match up to the standards of these luxury car brands. In fact, it is being speculated that the structural growth of the suppliers is faster and greater than the actual car brands where there is an existence of uncertainties, higher debt, and lower returns.

According to records, the Allianz Continental European fund's main exposure to the EV trend is through German semiconductor maker Infineon. They represent 4.1 percent of the fund along with tyres and parts supplier Continental. Most of these companies are well positioned to experience heightened levels of profitable growth over the long term making them an alluring prospect for investors.

The shift from conventional vehicles to electric vehicles is a highly risky and cost inducing prospect for car makers. A huge investment has been made by car manufacturers and is bracing themselves for a tough time ahead. Investors are expecting a net rise in the sale of car part suppliers. With greater demand and durability of electric vehicles, the demand for tyremakers like Continental, Pirelli, and Michelin is also expected to rise. Not just tyres but other car part manufacturers like Unicore, producers of cathode materials used in automotive batteries will also enjoy a good position.

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