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Adam Levy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Honeywell International and Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.
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Interested in electric vehicle battery stocks? The automotive industry is increasingly shifting toward electric vehicle batteries instead of internal combustion engines. There's a clear demand for electric vehicles at the right price point. Investors who want to get ahead of that demand can do so by looking at the companies producing EV batteries, the most important and costly components of EVs.
If electric vehicle production significantly increases over the next decade, the demand for EV batteries will skyrocket similarly.
LG Energy Solution is the third-largest EV battery supplier in the world. The Korean company works with global automakers in the U.S., Japan, and Korea.
The company is aggressively expanding its production capacity to benefit from economies of scale in the highly commoditized EV battery industry. Management is targeting 30 GWh of capacity by the end of 2026, up from 17 GWh at the end of 2025.
It continues to invest in R&D to improve battery technology, focusing on features such as faster charging speeds that could help differentiate its product.
The benefits of investing in EV battery stocks include:
The risks of investing in EV battery stocks include:
The companies above represent a range of leaders in electric vehicle battery technology and ancillary industries supporting its development. There are companies at every stage of the growth curve: from pre-revenue start-ups to well-established auto manufacturers. Investors interested in EV battery stocks should be able to find an investment that suits their investment style and risk appetite.
There are a variety of ways to invest in EV battery stocks, from component suppliers to auto manufacturers to the battery makers themselves. Not every one of those stocks will necessarily be a great investment all the time, and not all of them will fit in every portfolio. Whether you should invest in an EV battery stock will depend on exactly what you're looking to add to your portfolio, the individual stock's value and outlook, and your risk tolerance.
Electric vehicle (EV) battery stocks range from fully integrated auto manufacturers developing their own battery designs and technologies to specialists focusing on solid-state batteries. It also includes companies providing key materials or ancillary equipment for development, testing, and safety. Here are the top picks.
Tesla (TSLA -1.71%) is the largest auto manufacturer by market cap and exclusively builds electric vehicles. While it partners with several battery suppliers, it's behind the designs.
Tesla has a built-in customer for its battery designs: itself. However, Tesla's auto sales have been falling as competitors enter the market, especially in Europe. Investors are hoping the introduction of its robotaxi service will be met with strong demand, pushing more Tesla vehicles onto the streets.
You might know the Honeywell (HON -1.34%) name because it designed your home thermostat. It also designs safety systems for commercial buildings, avionics systems for commercial airlines and the military, and systems to automate safety and efficiency in various work environments.
Honeywell doesn't design EV batteries itself. Instead, it uses its expertise in safety automation to make them safer. Battery manufacturers can incorporate Honeywell's technology into their battery packs to help prevent fires. Honeywell's systems can detect thermal runaway by sensing off-gassing or particulate matter, providing ample time for a driver to stop the car and seek repairs before a battery fire.
While the battery safety business is only a tiny part of Honeywell, the growing trend toward battery-only vehicles provides an ample runway for growth in the segment.
BYD (BYDDY -0.43%) is an integrated EV company based in China, and it's one of the world's most valuable automakers. It manufactures and sells hybrid and battery-powered cars, buses, trucks, and monorails, as well as batteries, semiconductors, and other components used in its EVs.
BYD's EVs are top sellers in China and Europe. It's the leading global manufacturer of battery electric vehicles and plug-in hybrids by a wide margin. As a fully integrated EV company, it is benefiting from brisk sales in its battery business.
Li Auto (LI +0.41%) is a Chinese auto manufacturer specializing in plug-in hybrid EVs, which offer a combustion backup to their battery-powered engine. This allowed it to scale its battery pack production earlier than many competitors, giving it a cost advantage. Li still sources its battery cells from third parties, including China's Contemporary Amperex Technology Limited (CATL), and its cost advantage is eroding as other competitors scale.
Li launched its first battery-only vehicle in 2024. The Mega minivan received a lukewarm reception, as did Li's second pure-electric vehicle, the i8 (a full-size SUV). The company continues to release new vehicles for the battery-only lineup, but finding its market has been difficult.
Albemarle (ALB +1.17%) is one of the world's top lithium producers -- a key component in most EV batteries. The mining and base materials company has narrowed its focus on lithium in recent years.
Lithium prices are cyclical, leading to periods of strong revenue and profit growth and periods of spending cuts. Amid low lithium prices in 2024, Albemarle had to cut back on overhead and its capital expenditures to account for the market weakness. The moves put the business on a much better financial footing while enabling it to ramp back up as prices climb again.
Given the expected boom in EV sales over the next decade, Albemarle could have plenty of tailwinds to keep its overall trajectory headed higher for years to come. The company has assets in Chile and Australia that can produce lithium more cheaply than competitors, allowing it to remain profitable in tough times and competitive when prices rise.








| Name and ticker | Market capMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary. | Dividend yield | Industry |
|---|---|---|---|
| Tesla (NASDAQ:TSLA) | $1.4 trillion | 0.00% | Automobiles |
| Toyota Motor (NYSE:TM) | $230.3 billion | 1.47% | Automobiles |
| Honeywell Technologies (NASDAQ:HON) | $68.9 billion | 2.04% | Industrial Conglomerates |
| BYD Company (OTC:BYDDY) | $42.2 billion | 0.46% | Automobiles |
| Li Auto (NASDAQ:LI) | $10.4 billion | 0.00% | Automobiles |
| Albemarle (NYSE:ALB) | $16.2 billion | 1.18% | Chemicals |
| Panasonic (OTC:PCRFF) | $64.0 billion | 0.95% | Household Durables |
| QuantumScape (NASDAQ:QS) | $3.5 billion | 0.00% | Auto Components |
| Solid Power (NASDAQ:SLDP) | $531.7 million | 0.00% | Auto Components |

Solid Power (SLDP -1.90%) designs solid-state battery technology. Management intends to license its designs or sell its solid electrolyte for use in production at other battery manufacturers. Its technology is also compatible with existing technologies, so its designs can get to market faster.
In 2024, Solid Power won a $50 million award from the U.S. Department of Energy to produce its electrolyte materials for solid-state batteries. The award should help bolster its cash runway, as its minimal partner revenue began to stall in the latter half of 2024.
Since it's backed by Ford and BMW, it should have customers lined up for its batteries if it can execute on its timeline. BMW has already begun testing vehicles powered by its battery technology in Munich. Still, there's a risk that its technology won't work as well as expected or that competitors will develop a better product in that time.
Investing in EV battery stocks is simple. The following steps will walk you through it.
QuantumScape (QS -4.92%) is developing solid-state battery technology to increase EV range and enable faster charging. The U.S. company is just beginning to test its battery technology at scale.
QuantumScape is spending heavily to bring its technology to market. The company delivered its first prototype battery samples to EV automakers in 2022. Testing has gone well, with its auto manufacturing partners impressed with the performance. It has since signed multiple major commercial deals to license its technology. Still, management doesn't expect to generate meaningful commercial sales until late 2026 or 2027.
Ultimately, if its technology fails or is a commercial flop, QuantumScape's stock could become worthless. Still, this is a promising EV battery company with immense growth potential if its research and development (R&D) efforts bear fruit.
Toyota (TM +1.29%) is already one of the world's leading car manufacturers, but it trails the competition in electric vehicles. The Japanese company's plan to catch up involves in-house battery manufacturing and technology development.
It acquired its battery joint venture with Panasonic (PCRFF -1.54%) in early 2024, now called Toyota Battery, and plans to ramp up production of fully electric vehicles to 1 million units by 2030. The company is developing solid-state battery technology and plans to begin commercial production in 2027.
If Toyota becomes a full-fledged EV battery manufacturer, it's well-positioned to make it profitable by integrating it with its popular vehicles.
Japanese conglomerate Panasonic is a large producer of EV batteries and has been a partner and supplier of Tesla for many years. The two companies first entered into a supply agreement in 2009. Although Panasonic is no longer Tesla's exclusive battery supplier, the company continues to produce a high volume of batteries for the EV carmaker via its gigafactory joint venture.
Panasonic's relationship with Tesla as a supplier may not last forever. It's working to expand its supplier relationships, including a deal with Lucid (LCID -1.57%) at the end of 2022. It also inked deals with Subaru (FUJHY +2.11%) and Mazda (MZA +1.59%) in 2024 and Amazon's (AMZN +3.97%) Zoox in 2025.
While Panasonic isn't a pure-play EV battery company, it's likely to remain a leader in the sector.