We recently compiled a list of the 10 High Growth EV Stocks to Invest In. In this article, we are going to take a look at where Li Auto Inc. (NASDAQ:LI) stands against the other best High Growth EV stocks.
Automobiles that run on electricity rather than gas are referred to as electric cars, or EVs. Electric car stocks consist of companies that primarily manufacture electric vehicles. The electric vehicle business also includes companies that provide parts for electric vehicles, including batteries or autonomous driving systems.
S&P Global Mobility estimates that around 7.36 million of the 16 million cars sold in 2024 were not made in the United States, showing that President Trump’s 25% tariffs on imported cars, which have been in effect since March 2024, affect about 46% of the country’s auto market. On May 3, tariffs on some auto components, including engines and transmissions, went into effect.
However, the administration unveiled a two-year relief plan in response to industry criticism. In the first and the second year, automakers that manufacture in the United States are allowed to deduct import tariffs on parts up to 3.75% and 2.5% of the suggested retail price of a car, respectively. Automobiles having at least 85% U.S., Canadian, or Mexican components are exempt; by 2025, the percentage will rise to 90%. The overlapping tariffs on commodities, steel, and aluminum from Mexico and Canada have been waived for businesses. Industry groups have issued warnings that the tariffs would increase market maintenance costs, lower sales, and boost car prices.
Recently, according to the Cox Automotive report, in Q1 2025, sales of electric vehicles in the United States rose 11.4% year over year to around 300,000 units, making up 7.5% of all new vehicle sales, up from 7% in Q1 2024. New model launches fueled growth, with multiple brands either diversifying their EV lineups or making their first steps into the market. One significant automaker sold over 30,000 EVs, almost doubling its volume from the previous year. In Q1, another company that had not been involved in the EV market before contributed over 14,000 units. However, not all players grew; some established models experienced significant decreases as product strategies changed.
However, the market for EVs is facing more challenges. A well-known EV brand had a 26% decline in sales from its 2023 peak of 173,000 units to 128,000 units in Q1, a 9% year-over-year decline, and a 3% decline in market share. Future growth is threatened by ongoing tariffs on vehicles and essential commodities like aluminum and battery supplies, as well as policy uncertainty.
Nonetheless, the research firm Rho Motion projected that China’s prolonged subsidies and the new EU emissions targets will propel global EV and plug-in hybrid sales to increase by more than 17% in 2025, reaching 20 million units. China is the market leader, with EV sales forecast to jump by 40% to 11 million by 2024, and Latin America and Asia-Pacific will continue to dominate. Sales in Europe are anticipated to surge by 15% from 3 million units in 2024, even though there could be fines of €10 billion for missing emissions targets. Despite the uncertainties surrounding policy, U.S. sales have been projected to rise by 16%.
Rho Motion Head of Research, Iola Hughes, stated:
“In the US market, a lot of uncertainty has obviously hit the market in the last year or so, and we are expecting reduced EV forecasts,” “However, the shift to electric vehicles is still very much happening and we will still see growth over the next decade.”
Our Methodology
For this article, we sifted through the online rankings to form an initial list of the 20 EV stocks. From the resultant dataset, we chose 10 stocks with an average 5-year revenue growth of over 20%.
Why are we interested in 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).
Li Auto Inc. (NASDAQ:LI)
Average 5-Year Revenue Growth: 247.68%
Li Auto Inc. (NASDAQ:LI) is China’s leading manufacturer of new energy vehicles, focusing on plug-in hybrid electric sport utility vehicles for family use. The company made significant investments in its range-extension powertrain, which has become a key selling point for its cheap vehicles. Plug-in hybrid electric vehicles cost substantially less than battery electric vehicles, or BEVs, since they use fewer batteries.
Li Auto Inc. (NASDAQ:LI) remains a high growth stock due to its explosive growth path. Over 158,000 vehicles were supplied by the company in Q4 2024, setting a new quarterly record. Deliveries for the entire year topped 500,000 units, making it the first luxury Chinese vehicle brand and emerging NEV to reach this milestone. More than 373,000 deliveries were made in 2023, showing a 35% spike in sales despite the difficulties faced by other EV stocks. One major reason for this is its premium appeal, as the Li AD Max accounts for more than 80% of orders in China for models priced above $55,000.
Li Auto Inc. (NASDAQ:LI) reported that it delivered 33,939 vehicles in April, a 31.6% increase from the previous year. The firm had made 1,260,675 deliveries overall as of April 30.
Overall, LI ranks 1st on our list of the High Growth EV Stocks to Invest In. While we acknowledge the potential of LI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than LI but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
