Toyota (TM) Backed Carvitor Working On Flying Car Prototype

Toyota Motor Corp Ltd (NYSE:TM) supported engineer group, Cartivator aims to build and commercialize flying cars by 2025. It is currently working on a prototype, which is expected to be able to light up the Olympic flame for the opening ceremony of the Tokyo 2020 Summer Games. Recently, the group gave a demonstration of the car, which was able to get off and float above the ground for a few seconds.

Cartivator is a group of engineers who began the development of a flying car, "SkyDrive" in 2014. The group currently expects to conduct the first manned flight by the end of 2018. It plans to make the flying car the smallest electric vehicle, which can also be used in urban areas.

Recently, Toyota agreed to invest ¥42.5 million (roughly $385,000) in the project over the next three years, with Cartivator expecting to receive further investment from the company in the future.

Several other companies are working toward developing flying vehicles. Uber Technologies Inc aims to deploy its flying taxi service by 2020 in Dallas-Fort Worth, Texas as well as Dubai. Meanwhile, Airbus Group (PA:AIR) is also working on its flying car under its Urban Air Mobility division.

For the last few years, Toyota has been investing large amounts of capital for developing robotics and artificial intelligence. This includes using robotics to help the sick walk. Recently, the company also announced a $35 million investment over the next five years in its research center in Ann Arbor, MI, for autonomous and connected vehicle technologies.

Price Performance

Toyotahas underperformed the Zacks categorized Automotive–Foreign industry in the last three months. The automaker’s shares have dropped 4.6% over this period, while the industry witnessed a 1.9% decline.

Zacks Rank and Stocks to Consider

Currently, Toyota carries a Zacks Rank #3 (Hold).

Some better-ranked companies in the auto space include PACCAR Inc. (NASDAQ:PCAR) , Lear Corporation (NYSE:LEA) and GKN (LON:GKN) plc (OTC:GKNLY) . All three stocks hold a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

PACCAR has an expected long-term growth rate of 10%.

Lear has an expected growth rate of around 7.1% over the long term.

GKN has an expected long-term growth rate of 5.3%.

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