Nio Inc., the China-based electric vehicle (EV) manufacturer, saw its shares rise on Friday, signaling a promising start to September. This surge came after the company reported a significant leap in deliveries, breaking a three-day losing streak. Despite a challenging August that closed with the stock at an eight-week low of $10.27, Nio’s recent performance suggests a potential turnaround. The company reported a delivery tally of 19,329 vehicles in August, an impressive 81.0% increase from the 10,677 EVs delivered in the same period last year. This follows a more than doubling in deliveries in July, when it delivered 20,462 EVs.
However, the road to recovery may not be straightforward. Nio’s shares plummeted by 32.9% in August, marking the steepest monthly selloff since the 38.7% plunge in October 2022. This underperformance compared to its peers and the broader market was largely attributed to a disappointing second-quarter report, which revealed wider losses and a larger-than-expected drop in revenue. However, other China-based EV makers are also rallying, suggesting a potential industry-wide rebound. While Tesla Inc.’s stock eased, Li Auto Inc.’s stock rose by 1.9% following a 663.8% surge in August deliveries, and XPeng Inc.’s shares jumped 3.2% after reporting a 42.9% increase in August deliveries.
Nio Inc.’s Stock Rises After Reporting Significant Jump in Deliveries
Shares of Nio Inc., the China-based electric vehicle (EV) manufacturer, rose by 1.8% in premarket trading on Friday, rebounding from an eight-week low of $10.27. This rise came after the company reported an 81% surge in its August deliveries, compared to the same period last year.
August Deliveries and Tumbling Shares
In August, Nio delivered 19,329 vehicles, an increase from the 10,677 EVs delivered in August of the previous year. This follows a more than twofold increase in deliveries in July, when it delivered 20,462 EVs. The August deliveries included 12,015 sport-utility vehicles and 7,314 sedans.
Despite the positive delivery report, Nio shares had a tough August, tumbling 32.9% – the biggest monthly selloff since October 2022, when it plunged 38.7%. This underperformance was attributed to a disappointing second-quarter report, which saw widening losses and revenue falling more than forecast.
Year-to-Date Deliveries and Competition
Year-to-date, Nio has delivered 94,352 vehicles, up 31.9% from the 71,556 EVs delivered at the same time last year. Meanwhile, shares of other China-based EV makers also rallied on Friday. Li Auto Inc.’s stock rose 1.9% after reporting a 663.8% surge in August deliveries to 34,914 EVs. XPeng Inc.’s shares also jumped 3.2% after it reported delivering 13,690 EVs in August, up 42.9% from the previous year.
In contrast, Tesla Inc., which generated 23% of its total second-quarter revenue from China, saw its shares slip by 0.4% in premarket trading. This comes after Tesla lost 3.5% in August and made moves to cut prices on its Model S and Model X EVs in China in a bid to boost sales.
Takeaways
A key takeaway from this report is the resilience of China’s EV market, evidenced by the impressive delivery numbers from Nio, Li Auto, and XPeng. Despite facing stiff competition from globally recognized brands such as Tesla, these companies have managed to record significant growth in their deliveries. However, it’s also clear that the volatile nature of the stock market can significantly impact these companies, as seen in Nio’s August performance.
