Could Ford Win the Self-Driving Car Race?
My family really likes cars.
Actually, scratch that. My family is obsessed with cars.
To us, cars are more integral to the American identity than apple pie, baseball, and national parks.
And our strange obsession with the American automobile industry is rooted in history. You see, my grandpa was an incredible man. He designed cars for Ford and still found time to pass down a love of cars to his children, including my father.
It's because of my grandpa that my childhood was defined by sitting in my dad's workshop, handing him tools as he rebuilt some kind of run-down vehicle.
And this love of cars never stopped.
When my grandfather retired from designing cars, his favorite retirement activity became taking his grandchildren off-roading in the Red Rocks of Sedona, Arizona.
His off-roading vehicle of choice? A beat-up Ford Bronco.
All this said, it's easy to see why my family panicked when Ford announced that it would stop building cars.
It was almost as if someone had told my family that the sun was going to get blown out, leaving the world in utter darkness.
But I don’t think there is any reason to fret.
As the youngest member of a family of car lovers, I don’t think American-made cars or American car companies are going anywhere anytime soon.
These companies are just changing. They're adapting to an unavoidable and quickly approaching autonomous car future.
And this is a good thing. Companies that don't adapt to change disappear.
All you have to do is look at the heartbreaking photos of boarded-up Toys "R" Us to see this is true.
And if you know how to play your cards right, the companies that are good at adapting like Ford could still have a lot to give.
Car Companies Need to Change to Survive
Sadly, it is just a fact at this point: In order to survive, car manufacturers like Ford need to change.
Just one cursory glance at the numbers shows this is true.
The annual growth rate in car sales is supposed to decrease about 2% annually by 2030. And I think one major reason for this decrease is fairly obvious: the millennials.
Now, I'm not usually one to blame the millennials (because I am one), but our preferences and expectations will have a massive impact on the auto industry.
We were the first generation to say, "Cars are too expensive." And we weren't wrong.
Lyft’s chief strategy officer, Raj Kapoor, told USA Today that it costs an average of $9,000 a year to maintain a car, and that car is only used about 4% of the time.
That considered, it isn't surprising that some millennials are opting out of car ownership altogether. They will even choose where they live based on whether or not they have to own a car.
And that does not bode well for car companies, which need the newer generation to buy cars with the same fervor as the older generation.
And millennials aren't the only pressure car manufacturers are facing. They are also facing a whole new threat: ride sharing.
Uber and Lyft are massively popular these days. While expensive, they allow city livers to reach offices, bars, and other destinations without ever getting behind the wheel of their own car.
And those kinds of companies have put big car manufacturers in a hurt locker.
That is why smart companies have to pivot, and soon.
And lucky for Ford investors, Ford has been preparing for this change for quite some time.
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Ford Is Already Eyeing the Robo-Taxi Market
Why am I so confident that Ford is already gearing up and adapting to the new age of automobiles?
The reason is actually quite simple.
Ford has already started investing in the technologies that will power the driverless car revolution. Let me show you.
In 2017, Ford made a billion-dollar bet by investing in Argo AI.
Argo AI is an artificial intelligence startup with the goal of building an automobile that can be controlled by artificial intelligence. This kind of technology is critical to building a successful autonomous car, which will need to process data incredibly quickly and make rapid judgments.
Today, Argo AI is still busily working toward helping Ford deliver its first autonomous vehicles. And those vehicles are coming fast, with the two companies aiming to have the vehicles on the road in just three years.
And then there is more recent news.
On June 8, 2018, a Ford executive told Bloomberg that the company is "laser-focused on the ultimate goal of profitable miles and utilization" from its autonomous vehicles.
And Ford may have an edge on other companies like Tesla that are also battling to get into the autonomous car industry.
To be blunt, Ford is a giant.
It's a company with a legacy of cutting-edge design and engineering. It also has years of experience rolling out massive-scale projects and catering to buyers all over the globe.
And these are all traits that will come in handy during the autonomous car race.
They are, no pun intended, ahead of the curve.
But how can you profit?
Profiting From the Self-Driving Car Industry
Up to this point, investing in the self-driving car industry has been a lot like sampling oatmeal in the story of “Goldilocks and the Three Bears.”
Pre-2010 was very early. Post-2010 was filled with hype.
Right now is when conditions are approaching just right.
As more and more big companies like Ford and Google enter the autonomous car race, it brings layers of experience that simply weren't in the space before.
That means the self-driving car race is about to heat up, bringing with it investment opportunities.
Over the next couple of months, we're going to be keeping an eye on the self-driving car race in our Wealth Daily reporting, so if this is a topic that interests you, make sure to keep an eye on your inbox.
If you're interested in investing in other emerging technologies, make sure to check out our recent presentation on 5G technology.
This unique presentation provides details on three stocks poised to boom in the coming 5G revolution. To unlock your presentation, click here.
Best of luck with your investments,
@AlexandraPerryC on Twitter
Alexandra Perry is a contributing analyst for Wealth Daily and Energy and Capital. She has multiple years of experience working with startup companies, primarily focusing on artificial intelligence, cybersecurity, alternative energy, and biotech. Her take on investing is simple: a new age of investor can make monumental returns by investing in emerging industries and foundational startup ventures.
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