Challenges Ahead for Ford as Electric Vehicle Market Grows

The energy landscape is shifting. As electrification gains traction, traditional gas engines are being phased out. This shift poses significant risks for Ford Motor (NYSE: F). The well-established American automaker is expanding into electric vehicles, yet it struggles to make the segment profitable amid rising costs, looming tariffs, and stiff competition from dedicated electric vehicle manufacturers and various global brands.

With a market capitalization of $41 billion, Ford faces a rocky path over the next decade as it contends with intensifying global competition in the electric vehicle arena. Here are two stocks, differing in size and risk, that I believe could surpass Ford in market value over the next decade.

Spotlight on Rocket Lab: A Rising Star in Space

First on the list is Rocket Lab (NASDAQ: RKLB), which currently boasts a market cap of $9.5 billion—significantly smaller than Ford. Nevertheless, patient investors might find it poised for considerable growth over the next ten years.

This company anticipates generating approximately $500 million in revenue for the current year, a fraction of Ford’s revenue exceeding $100 billion. However, it’s essential for investors to focus on future potential rather than past performance. Since going public in 2021, Rocket Lab’s revenue has surged by 680%, making it one of the fastest-growing firms in the industry.

Rocket Lab operates the small Electron rocket, recognized as one of the few reliable options outside of SpaceX for launching commercial products. The company has already completed five launches in 2025 and continues to secure new contracts from clients appreciating its consistent launch capabilities. Additionally, its Space Systems division, which develops satellites and solar arrays, contributes to its revenue stream. This vertical integration strengthens Rocket Lab’s competitive edge.

Looking ahead, Rocket Lab plans to introduce its larger Neutron rocket, which will offer a significantly higher payload capacity. This advancement holds the potential to dramatically increase revenue. The space economy is projected to become a $1 trillion market, providing a substantial opportunity for continual growth.

As Rocket Lab’s revenue increases, it may reach $10 billion in the next ten years, potentially achieving a market cap exceeding Ford’s. While it presents more risk than my next stock, Rocket Lab offers significant upside for patient investors willing to enter now.

Image source: Getty Images.

Capitalizing on Rising Electricity Demand

Electricity demand in the United States is on the rise, driven by the transition to electric vehicles and increasing needs from artificial intelligence (AI) services. Occidental Petroleum (NYSE: OXY) may be positioned well to benefit from this growing trend. Notably, its largest shareholder is Berkshire Hathaway, which owns 28% of its stock.

Occidental Petroleum focuses on oil and natural gas production while also managing midstream services and chemical production. Although the shift toward renewable energy is underway, the demand for natural gas is expected to rise as it replaces coal globally. Moreover, petroleum remains integral for many products beyond energy.

Occidental’s market cap stands around $42 billion, offering stability as an investment and is likely to outperform Ford over the next decade. Over the past year, it reported $4.4 billion in free cash flow, which has faced recent declines due to falling oil prices. Management is committed to reducing debt and returning capital to shareholders.

The stock provides a dividend yield of 2.3%, offering shareholders a reliable income stream. While Ford’s dividend yield exceeds 5%, its higher risk of cuts amid industry pressures makes Occidental a more attractive option. Management believes that by 2026 and 2027, free cash flow will increase by over $1 billion, bolstered by improvements in midstream operations and chemicals. This could elevate free cash flow above $5 billion annually, allowing for debt repayment and potential dividend growth.

If oil prices rise, free cash flow might approach $10 billion per year, resulting in a low earnings multiple for a stock with a $42 billion market cap. Compared to Ford, Occidental Petroleum appears capable of generating a significant portion of its market cap in cash flow over the next decade, possibly even surpassing it. Consequently, I anticipate Occidental Petroleum will be a larger stock in ten years, while Ford faces challenges.

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Brett Schafer has no position in any of the stocks mentioned. The Motley Fool recommends Occidental Petroleum and Rocket Lab USA. The Motley Fool has a disclosure policy.

The views expressed in this article represent the author’s opinions and do not necessarily reflect those of Nasdaq, Inc.