Each of EKAR’s stakeholder categories has a 40% max weighting as per the index methodology, with current weights comprised of Semis & Software 39%, OEMs 33%, Suppliers 15% and Battery Producers 13%.
Markiewicz explained the ETF’s largest country weighting is the US at 41% followed by Japan at 17%, Germany 12% and China at 10%. There are 15 countries represented in the index.
“As the world’s appetite for not only electric but self-driving vehicles increases, it is possible that the basket could become even more geographically diverse,” Markiewicz said.
Looking ahead, Markiewicz sees strengthening momentum in the space. According to a December 2017 McKinsey Center for Future Mobility report, in autonomy, 1-2% of vehicles currently sold are equipped with basic partial automation technologies. By 2025, 80% of the top 20 OEMs are planning to have at least Level 4 automation, so cars can fully drive themselves in most situations with hardly any human intervention. In the electric vehicle space, 3.5% of the vehicles sold now have xEV or hybrid/plug-in powertrains which compares to 51% of the models announced until 2021 that are expected to have xEV powertrains.
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