China Is Preparing to Challenge Tesla | ETF Trends

In the business world, healthy competition can help spur innovation. China is looking to one-up Tesla in the autonomous driving space, which could help the Global X Autonomous & Electric Vehicles ETF (DRIV).

DRIV seeks to invest in companies involved in the development of autonomous vehicle technology, electric vehicles (“EVs”), and EV components and materials. This includes companies involved in the development of autonomous vehicle software and hardware, as well as companies that produce EVs, EV components such as lithium batteries, and critical EV materials such as lithium and cobalt.

DRIV seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Solactive Autonomous & Electric Vehicles Index. The fund offers:

  • High Growth Potential: DRIV enables investors to access high growth potential through companies critical to the development of autonomous and electric vehicles – a potentially transformative economic innovation.
  • An Unconstrained Approach: DRIV’s composition transcends classic sector, industry, and geographic classifications by tracking an emerging technological theme.
  • ETF Efficiency: In a single trade, DRIV delivers access to dozens of companies with high exposure to the autonomous and electric vehicles theme. Having the disruptive automotive industry in an ETF wrapper also gives traders access to short-term market maneuvers in this sub-sector.

DRIV is up over 80% the past year:

DRIV Chart

Xpeng Motors Joining the Electric Vehicle Space

Per a CNBC article, “Chinese electric carmaker Xpeng Motors has started rolling out its new autonomous highway driving features to eligible customers as it looks to ramp up its challenge to Tesla in the world’s largest auto market.” Tesla is DRIV’s top holding at a 5% allocation towards net assets.

Some of the features the company is looking to add includes customizable driving dynamics:

The electric vehicle start-up announced the Navigation Guided Pilot or NGP this month. The feature allows drivers to automatically change lanes, speed up or slow down, overtake cars as well as enter and exit highways,” the article noted. “It is part of the next generation of Xpeng’s XPILOT 3.0 ‘advanced driver-assistance system’ (ADAS). Customers who have purchased the option on the premium version of Xpeng’s P7 sedan will be able to download NGP over WiFi.”

“The features are part of a broader so-called over-the-air update that allows customers to download new software via WiFi. It is similar to upgrading the operating system on a phone,” the article added further. “XPeng’s operating system, Xmart OS 2.5.0, will be available to all P7 customers, the company said. It includes an upgraded voice assistant and certain in-car apps.”

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