We recently published a list of 12 Best EV Battery Stocks to Buy in 2025. In this article, we are going to take a look at where Toyota Motor Corporation (NYSE:TM) stands against other best EV battery stocks to buy in 2025.
EV Magazine highlighted that The Promoting Resilient Supply Chains Act remains critical for strengthening the EV supply chain in the US, with strong implications for domestic and international markets. The legislation addresses the increasing need for a robust and localized EV supply chain in the US, which is of utmost importance as the broader automotive industry witnesses a significant transition towards electrification.
Notably, the act encourages the localization of critical components in the EV supply chain, mainly batteries and microchips.
What’s In Store for EV Battery Prices?
S&P Global highlighted that the EV battery prices declined significantly over the past few years, primarily because of the decline in prices of critical battery metals i.e., lithium, cobalt, and nickel. For example, cobalt price has declined from ~$70,000 per metric ton in 2022 to ~$30,000 in 2024. Similarly, the lithium carbonate price has fallen from a high of ~$70,000 per metric ton to well below $15,000 in 2024. S&P Global believes that battery metal prices are expected to increase over the longer term. However, because of economy of scale and efficiency gains, the manufacturing cost is expected to be lowered. These 2 effects are expected to result in a flat price trend, demonstrating a marked difference with the exponential price reduction over the past decade.
According to Nikhil Bhandari, co-head of Asia-Pacific natural resources and clean energy research at Goldman Sachs, the global average EV battery price is expected to reach US$90 per kilowatt-hour (kWh) in 2025, demonstrating a decline from US$111 per kWh at the end of 2024. The investment bank believes that, by 2026, it might decline to US$82 per kWh. This means the prices will be ~50% lower than US$149 per kWh in 2023, bringing the cost of owning a battery car in line with the petrol cars in the US on an unsubsidized basis.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Growth Drivers for the EV Battery Market
As per Research Nester, the EV battery market size has been pegged at US$148.34 billion in 2024 and is expected to surpass US$923.08 billion by 2037 end. In 2025, the industry size of EV battery is expected to be at US$166.26 billion. The market’s growth is expected to stem from the increasing need to save oil and gas. This factor has been prompting nations throughout the world to deploy EVs. The introduction of new models in the market is expected to drive the interest of people in EVs, which will in turn drive the demand for batteries. Research Nester also added that advancement in technology is anticipated to bring opportunities for the broader market.
Our Methodology
To list the 12 Best EV Battery Stocks to Buy in 2025, we conducted extensive research and sifted through several online rankings. Next, we chose the stocks that were popular among hedge funds. Finally, the stocks were arranged in ascending order of their hedge fund sentiments, as of Q3 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Workers assembling a car in a modern manufacturing plant, emphasizing the company’s sense of progress.
Toyota Motor Corporation (NYSE:TM)
Number of Hedge Fund Holders: 18
Toyota Motor Corporation (NYSE:TM) is engaged in designing, manufacturing, assembling, and selling passenger vehicles, minivans, and commercial vehicles. In early March 2024, the company agreed with Panasonic Holdings Corporation to make Primearth EV Energy Co., Ltd. a wholly owned subsidiary to strengthen its capabilities in mass-producing automotive batteries. It also decided to change the company name to TOYOTA BATTERY Co., Ltd. Toyota Motor Corporation (NYSE:TM) expects that it can manufacture next-generation solid-state batteries at the same rate as current batteries for EVs, demonstrating a strong move in the global competition to commercialize the technology. Furthermore, Fortune Business Insights mentioned the company’s plans to spend US$13.5 billion to develop electric vehicle battery technology by 2030.
It also highlighted that it is targeting to launch EVs with solid-state batteries as early as 2030. The company announced that Toyota Engineering & Manufacturing North America, Inc. (TEMA), inclusive of Toyota Motor North America (TMNA) R&D, was selected to get $4.5 million in funding from the US Department of Energy, Advanced Research Projects Agency-Energy (ARPA-E). The funding forms part of the Catalyzing Innovative Research for Circular Use of Long-lived Advanced Rechargeables (CIRCULAR) Program, which emphasizes supporting a circular domestic supply chain for electric vehicle (EV) batteries.
Furthermore, strategic investments in solid-state battery technology are expected to provide the company with a major competitive advantage by providing longer range and faster charging times. By 2030, Toyota Motor Corporation (NYSE:TM) plans to offer at least 30 BEV models and anticipates selling ~3.5 million BEVs a year globally. In Europe, the company’s BEV line-up is expected to expand to 10 models by 2025. Through the introduction of cost-effective models, Toyota Motor Corporation (NYSE:TM) can tap into the mass market, further enhancing its sales volume and profitability.
Overall, TM ranks 7th on our list of best EV battery stocks to buy in 2025. While we acknowledge the potential of TM as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than TM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
