Artificial intelligence, or AI, plays a critical role in EV proliferation by improving energy efficiency, enabling autonomous driving, design improvements, and manufacturing optimization. Moreover, with the potential of AI to substantially improve the safety and economic feasibility of EVs, it could play a massive role in their mass adoption. Therefore, it is prudent for investors to stay ahead of the trend and load up on EV artificial intelligence stocks.
Analytics website Statista predicts that the EV market could grow to a whopping $457.6 billion this year. This would amount to a compounded annual growth rate of 17% through 2027. Such an impressive pace is undoubtedly linked to improvements in artificial intelligence and other technologies, enabling adoption at a much broader scale.
The AI sphere has been the talk of the town, with significant hyperbole surrounding ChatGPT, Bard, and other emerging technologies in the sector. As the AI tech wars continue to heat up, I expect these artificial intelligence stocks to snap back from their 2022 lows, and reach new heights.
Tesla (TSLA)
Tesla (NASDAQ:TSLA) has perhaps the most significant stake in the proliferation of electric vehicles. After all, the industry is synonymous with the company, which aims to “accelerate the world’s transition to sustainable energy.” With artificial intelligence playing a crucial role in the company’s long-term growth plans, it’s clear Tesla is a front-runner in the AI/EV discussion.
There are multiple use cases for Tesla’s use of AI within its business model. The company is using this technology to improve the quality of its products and services. That said, its Autopilot feature is certainly where AI is of paramount importance. After all, its CEO Elon Musk described Full Self Driving (FSD) as “the difference between Tesla being worth a lot of money or worth basically zero.”
Autonomous vehicles must interpret images their sensors and cameras produce to effectively drive independently, using those data to make decisions. Autonomous driving technology uses AI to anticipate the movement of different vehicles, pedestrians, and others. Tesla can crowdsource the data it can gather from thousands of cars currently on the roads. Over time, I think this could be a game-changer for the world’s largest automaker by market capitalization.
Ansys (ANSS)
Ansys (NASDAQ:ANSS) commands a dominant position in the simulation space, providing AI-related services that can be applied to various sectors. Some industries where it offers the most utility include aerospace, telecommunications, healthcare, and EVs.
EV companies have used the firm’s patented engineering simulation software to improve design, safety, and performance, while also developing autonomous driving capabilities. It can simulate various scenarios, enabling EV manufacturers to identify potential issues. For instance, its software can identify areas where improvements can be made by simulating the behavior of a vehicle in different driving scenarios.
Furthermore, it operates a high-quality business, marked by an impeccable margin profile. The company works a clean and robust balance sheet, with remarkably low debt compared to its earnings. Moreover, it derives over 31% of its annual contract value from high-tech industries, significantly improving the stability of its cash flow base.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) has made massive advancements in the automotive niche in the past few years. As a chip maker focused on key high-growth segments such as gaming and artificial intelligence, its technological expertise has allowed the company to exceed expectations with its innovative products and services.
Notably, its DRIVE platform is revolutionizing the future of autonomous vehicles. This technology provides new opportunities for advancements in self-driving. This open and scalable computing platform offers unparalleled performance, energy efficiency, and safety standards. Its automotive solutions are available to automakers, research institutions, and startups working on the future of transportation.
So far, the platform has attracted multiple partnerships with some of the biggest names in the automotive space. Some of these companies include BMW (OTCMKTS:BMWYY), Honda (NYSE:HMC), and Jaguar. Moreover, it partnered with Foxconn to develop its DRIVE Orin Computers for the global automotive space, integrating its Hyperion Sensor architecture for EV fleets.