Investing

3 EV Stocks to Add in January, Before they Take Off in 2025

Chris MacDonald

Published: January 20, 2025 4:35 pm

The electric vehicle transition has been something to behold, with market leaders such as Tesla (NASDAQ:TSLA) in the U.S. changing the way many consumers feel about EVs. A range of concerns, from climate change to the technological advancements many of these EVs have brought, have tilted the car buying decision matrix in favor of EVs for a significant percentage of the population.

Electrification is certainly one of the biggest trends we’ve seen play out in recent decades, and companies like Tesla have benefited in a big way. However, in this piece, I’m going to highlight three EV stocks I think have more upside ahead in 2025 on a relative value (and growth) basis, given their focus on other high-growth markets with better fundamentals and longer-term outlooks.

For those looking for international exposure to a trend that’s about as broad and robust a secular growth trend as they come, here are the top 3 EV stocks I think are worth adding in January, before they take off.

Key Points About This Article:

• These three EV stocks look poised for some big upside ahead, if the market begins to value the sector fairly.
• These companies have excellent growth prospects and solid valuation multiples, unlike many companies operating in this space.
• If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.

BYD Co. (BYDDF)

Officially the world’s largest EV maker by volume, BYD (OTCMKTS:BYDDF) is the leading EV maker out of China and a company that provides what I’d consider to be world-class vehicles at some of the most affordable prices out there. 

Of course, thanks to tariffs put on this sector by the Biden Administration (and Trump likely to double or triple down on these tariffs) other U.S. EV makers (ahem, Tesla) should be safely protected from competition.

But the reality is that if there were truly a wide-open capital market in the U.S., BYD would likely win significant market share. The company recently reported record-breaking global sales of 4.27 million new energy vehicles (NEVs) in 2024, surpassing its 3.6 million target and marking a 41% year-over-year increase. This growth was fueled by robust domestic demand, successful government trade-in programs, and year-end discounts, despite rising competition from smaller Chinese EV makers. Passenger NEV sales alone reached 4.25 million, up 41% from 2023.

BYD’s 2024 battery electric vehicle (BEV) sales grew 12% year-over-year to 1.76 million units, while plug-in hybrid (PHEV) sales surged 73% to 2.49 million. Although Tesla slightly outpaced BYD in BEV sales at 1.78 million units, BYD’s rapid growth highlights its competitive momentum. In my view, this is the top EV stock in the market investors should be focusing on right now.

Li Auto (LI)

Li Auto (NASDAQ:LI) is another top Chinese EV maker, with similar sky-high growth driven by solid demographic drivers in the company’s core Chinese market.

The EV maker posted 2024 deliveries of 501,000 units, up 33%, and revenue growth of 42.25% year-over-year. The company plans to expand into the Middle East and Central Asia and views its upcoming BEV model as a key growth driver, though details remain undisclosed.

Li Auto’s BEV launch has come with low expectations. Thus, a number of industry experts appear to believe that this is a stock that could rally big time if the company hits this launch out of the park. With LI stock trading at just 13-times 2025 earnings, there’s a clear value argument to be had with this name (trading more like a slow-growth traditional auto maker than a company with 30%+ revenue and earnings growth potential ahead).

I think it’s this valuation disconnect that makes both Chinese EV makers worth considering right now. Li now offers investors a 7.3% return on capital after years of losses, and its shares trade near rock-bottom levels (compared to pandemic highs). Now’s the time to accumulate, in my view.

Volkswagen (VWAGY)

Rounding out this list of top international EV stocks I think could have a solid 2025, we have Volkswagen (OTCMKTS:VWAGY). The German automaker has seen strong EV adoption at home largely driven by the company’s ambitious strategies and substantial investments in electrification. Volkswagen has committed €35 billion towards electric vehicle development, aiming for 70% of its sales in Europe and 50% in the U.S. and China to be electric by 2030. This strategic pivot is part of its “Together – Strategy 2025,” which emphasizes sustainability and innovation, transforming Volkswagen into a leader in sustainable mobility.

In addition to expanding its EV lineup, Volkswagen plans to introduce affordable models priced under €25,000, targeting entry-level consumers and countering competition from lower-cost Chinese EVs. The company’s modular electric drive matrix (MEB) platform facilitates efficient production across its brands, enhancing its ability to scale up EV offerings rapidly. Furthermore, Volkswagen is investing heavily in software development and autonomous driving technologies, recognizing that digitalization will play a crucial role in future mobility solutions.

These initiatives position Volkswagen not only as a significant player in the EV market but also as a transformative force in the automotive industry, making it an attractive stock for investors looking at the future of transportation.