Self-Driving Cars: What Investors Need to Know

Companies such as Google, Tesla, and Sierra Wireless could be big benefactors from the self-driving revolution.

Feb 8, 2014 at 8:32AM

Nissan promises to have more than one fully self-driving vehicle on the market by 2020. That's still several years off, but the good news is that many autonomous features – such as smart cruise control and lane assist – are already in some vehicles today.

What will the self-driving future look like as different brands attempt to navigate the same roadways? As investors, we should be paying attention to companies that can help facilitate machine-to-machine, or M2M, communication, such as Sierra Wireless (NASDAQ:SWIR) and Google (NASDAQ:GOOGL).

Motley Fool analysts Austin Smith and Rex Moore saw this technology first-hand at the recent 2014 International CES. In this video from the floor of the exhibit hall, they talk about the exciting things for investors should watch for.

A full transcript follows the video.

Cash in on self-driving cars the smart way
Only a few investors are embracing this new market which experts say will be worth over $2 trillion. Find out how you can cash in on this technology before the crowd catches on, by jumping onto one company that could get you the biggest piece of the action. Click here to access a FREE investor alert on the company we're calling the "brains behind" the technology.

Rex Moore: Let's shift a bit. Still technology in the car – we're talking self-driving vehicles, autonomous features – a lot of that already in the cars now, but what did you see here?

Austin Smith: Self-driving cars, to me ... what's really interesting about this industry is that you've seen a lot of the auto manufacturers experimenting with these things over the years, but for these cars to really become a reality and really become ultra-safe, and really effective in the way that you need in the mass market, they have to be able to communicate with each other.

What's crucial to that is the Google Open Auto Alliance, that was announced here at CES. Chevy can't just have its own homegrown self-driving cars. It needs to be able to communicate with the Fords and the BMWs and the Audis that are right next to it on the highway, and that Open Auto Alliance makes that a reality.

I think there are going to be a lot of winners from the autonomous vehicle revolution. Tesla (NASDAQ:TSLA) – look to them to be an obvious player here – obviously the auto manufacturers that are here at CES, but I think it's those companies that bring it all together, the companies that are allowing these automobiles to seamlessly communicate with each other, that actually may be a bit more interesting from an investing perspective.

Now, we're not really sure of all the hardware, but expect some M2M companies, like maybe a Sierra Wireless, or companies of the like, to be involved in that cross-vehicle communication. Definitely an interesting thing from the manufacturer perspective, but from the investor perspective let's maybe look to a smaller company that's doing some M2M stuff, vehicle-to-vehicle.

Austin Smith owns shares of Ford, General Motors, and Google. Rex Moore owns shares of Google. The Motley Fool recommends BMW, Ford, General Motors, Google, Sierra Wireless, and Tesla Motors. The Motley Fool owns shares of Ford, Google, Sierra Wireless, and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers