For years, self-driving vehicles and flying cars seemed like futuristic ideas that only existed in movies. But recently, the rise of artificial intelligence (AI) and other technological advances has helped push us toward exactly that future.
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Recently, two companies have announced plans to expand into a city known for heavy traffic congestion. No, it is not Los Angeles, New York or Atlanta.
Although this city is on the other side of the globe, it is densely populated and growing, making it a highly logical choice for companies in the self-driving car and electric vertical take-off and landing (eVTOL) space to begin offering new means of transportation to consumers.
Elon Musk has been highly focused on helping Tesla (TSLA) beat its competitors to the front of the self-driving car race. But he is part of neither company poised to expand into a red hot transportation market.
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The transportation hub of the future is here
It's true that Americans in multiple U.S. cities, such as L.A., San Francisco, and Phoenix, can take rides in driverless cars. Meanwhile, various companies have begun testing eVTOLs, with the goal of ultimately opening this new means of transportation to the general public.
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But while the U.S. patiently waits for flying and self-driving cars to be adapted into the mainstream, one of the country's leading eVTOL producers is expanding into an international market with high growth potential.
Archer Aviation (ACHR) has made waves in recent years, establishing itself as a leader in the eVTOL space as enthusiasm mounts for flying cars. It isn’t the only startup rushing to corner this market globally, and recent developments indicate that it is making significant progress.
One week ago, Archer announced that it has reached an agreement with stakeholders across multiple industries to help launch the first commercial electric air taxi fleet in Abu Dhabi. The deal puts Archer in a unique position, as it will be the first eVTOL maker to hold manufacturing capabilities in the United Arab Emirates’ capital city.
While no specific date has been given for the launch, reports indicate that the Abu Dhabi Investment Office (ADIO) plans to facilitate the safe launch of commercial eVTOL services in Abu Dhabi as soon as possible. In 2023, Archer announced plans to bring all-electric air taxi operations to the UAE by 2026.
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This week also brought a key update regarding self-driving vehicles in Abu Dhabi. Uber (UBER) announced that it plans to offer rides in fully autonomous vehicles to the city through a partnership with Chinese autonomous technology company WeRide.
While the self-driving WeRide vehicles that users book through Uber’s app will initially have a human driver, Uber plans to introduce completely driverless vehicles into its Abu Dhabi fleet before the end of 2025.
Experts see growth potential for both ride-hailing, flying sectors
Maxim Manturov, Head of Investment Research at Freedom24, a subdivision of investing conglomerate Freedom Holding Corp (FRHC) , sees these developments as highly favorable for both companies.
“For Uber, this signals a step forward in its autonomous vehicle strategy, which could drive long-term cost efficiencies and scalability,” he tells TheStreet. “If successful, this could positively impact [Uber] stock by reinforcing investor confidence in its innovation and market leadership.”
Manturov adds that this development could also yield growth for the eVTOL maker, stating, “For Archer Aviation, expanding eVTOL operations in a tech-forward market like Abu Dhabi could enhance its credibility and open doors to further partnerships and revenue opportunities.”
He notes, though, that as a startup operating in a new industry, Archer still faces risk, including regulatory approval and infrastructure scaling obstacles. He regards ACHR stock as a “higher-risk, long-term play.”
David Materazzi, founder and CEO of automated trading platform Galileo FX, is more bullish about what this development means for both companies and their industries.
“These sectors aren’t on the verge of taking off… they’re already accelerating. Every regulatory hurdle cleared brings us closer to cities transformed by autonomous cars and flying taxis.”
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Assessing tech's emerging markets
While Manturov feels that both the self-driving car and eVTOL markets “feel poised for growth,” he advises investors to approach them with caution. He highlights companies that can provide alternative exposure to these industries, such as Tesla (TSLA) and Google (GOOGL) , through subsidiary Waymo, the company responsible for bringing autonomous driving to multiple U.S. cities.
“Abu Dhabi’s emergence as a transportation innovation hub underscores global momentum, but these technologies are still in early stages,” he notes. “Diversification within these sectors is key for investors looking to capitalize on the trend.”
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On the other hand, Materazzi describes Archer and its peers as the “architects of tomorrow” and advises investors to “look at the architects, not just the builders,” for better exposure to these emerging tech markets. Like Manturov, Materazzi is bullish on Waymo as an autonomous driving leader.
Both experts highlight Abu Dhabi as sitting at the intersection of botvel and technology, paving the way for companies to revolutionize its economy by changing thehows citizens travel. Materazzi sees this as a sound and necessary strategy.
“Governments investing billions and corporations racing to deploy fleets prove one thing,” he states. “The debate isn’t if these technologies will arrive, it’s who will dominate first. The smart money is already in.”
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