Those looking to invest in flying cars technology are likely excited about some recent developments in this cutting-edge technology. The Federal Aviation Administration (FAA) has awarded special certificates to several startups to begin testing flying vehicles in the United States. While the industry is in the nascent stages, the move by the aviation regulator shows it is starting to be taken seriously.
Forecasting the market size for an industry this new can be challenging, as much could change. Yet, Fortune Business Insights predicts the global flying car market will expand at a compound annual growth rate (CAGR) of 58.1 % through 2040 to exceed $1.5 trillion.
As the market grows, there will be clear winners and losers, just as there have been with electric vehicles (EVs) and autonomous vehicles. Investors who choose the best flying cars stocks to buy could see massive gains as the industry gets up and running.
Below are three potential top flying cars investments to consider. Just be sure that if you decide to invest in flying cars technology you can stomach the ride because it’s going to be a wild one.
XPeng (XPEV)
When it comes to electric vehicle companies diving headlong into the race for flying cars, few have risen to the challenge like XPeng (NYSE:XPEV). The Chinese automotive upstart’s XPeng X2 completed its first unmanned public test flight in Dubai in October.
The two-seater flying car, or electric vertical take-off and landing (eVTOL) aircraft, is capable of reaching speeds of up to 80 miles per hour, according to the company.
In January, the Chinese government granted XPeng’s eVTOL subsidiary, AeroHT, a conditional permit to continue testing the X2 with a pilot. This is a huge step forward on the company’s journey to bringing a flying car to market. XPeng has previously said it could start mass production by 2024.
XPEV stock is up 88% year to date. Of course, this has far more to do with the company reporting record EV deliveries as competitor Tesla’s (NASDAQ:TSLA) Chinese sales slumped, as well as a recent announcement that German automotive giant Volkswagen (OTCMKTS:VWAGY) acquired a 5% stake in the company.
Still, if XPeng’s X2 tests are successful and it becomes one of the first companies to bring a flying car to market, it could be a huge upside catalyst for shares.
Boeing (BA)
Those looking for a relatively safe pick among top flying cars investments should consider Boeing (NYSE:BA).
The company actually completed the first successful test flight of its autonomous passenger air vehicle it developed with Porsche (OTCMKTS:POAHY) in 2019. Impressively, the aerospace giant took just one year to go from “conceptual design to a flying prototype,” according to Boeing Chief Technology Officer Greg Hyslop.
While there has been little news on the project since, Boeing has also invested heavily in Wisk Aero, which is working to develop a pilotless flying taxi. Boeing unveiled the sixth-generation aircraft in June at the Paris Air Show. Wisk, which is now a wholly owned Boeing subsidiary, is expected to see its flying taxi certified around 2028.
BA stock is up 25% year to date, including an 11% advance since the company reported better-than-expected Q2 results on July 26. Revenue jumped 18%, while the company’s loss was narrower than expected. Free cash flow also came in ahead of forecasts, and management reiterated its full-year free cash flow guidance of between $3 billion and $5 billion.
Investors cheered the news despite losses in Boeing’s defense and space businesses. Flying cars could give them even more of a reason to get excited about shares.
Embraer (ERJ)
Brazil’s Embraer (NYSE:ERJ), which manufactures smaller commercial planes, created Eve Air Mobility in 2020. Eve Air Mobility is focused on developing an Urban Air Mobility (UAM) ecosystem, including eVTOL aircraft.
Eve Air Mobility, which is in the testing phase, has partnered with numerous air carriers worldwide. This includes United Airlines (NYSE:UAL), which placed a conditional order for 200 of Eve’s four-seater air taxis, with a price tag of around $15 million, and the option to order 200 more. The plan is to deploy them in the San Francisco Bay Area in 2026.
Eve is racking up the orders with a current order backlog of up to 2,770 eVTOLs, according to the company.
Eve Air Mobility actually went public via a special purpose acquisition merger (SPAC) merger last year. Yet, EVe Mobility Acquisition (NYSEAMERICAN:EVE) trades near its pre-merger price, and ERJ stock may offer a better way to play the flying cars market.
Embraer reported earlier this month that its second-quarter jet deliveries jumped 47% year over year, with the company delivering 47 aircraft. The company expects full-year deliveries to be up nearly 26% to 200 jets, which would mark the highest level since 2017, Reuters reports.
With ERJ stock, you are investing in the world’s third-largest planemaker and a multinational aerospace firm, offering stability along with the potential for gains from emerging flying car technologies. Year to date, ERJ has gained 34%.
On the publication date, Faizan Farooque did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
