Electric vehicle stocks in China: Nio to grow outside of China for the first time with Q3 sales

Chinese electric vehicle companies are preparing to report shipments for the third quarter after Nio (NIO) and Lee Auto (LI) cut delivery forecasts due to a surge in sales. New rivals Tesla (TSLA) in China has called a double headwind from the pandemic and the shortage of chips.




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Nio began selling its ES8 electric SUV in Norway on Thursday, challenging Tesla outside of China for the first time. The hot start-up of electric vehicles’s initial foray into international markets boosted Nio’s stock. Xpeng (XPEV) and BYD (BYDDF) also sells a small number of electric vehicles in Norway.

According to reports, if Norwegian customers choose to rent the battery for a monthly fee rather than buy it outright, the ES8 will cost less than the Model Y. Tesla dominates electric vehicle sales in Norway.

Nio, Xpeng, Li Auto: EV targets

Nio expects to ship 22,500-23,500 electric vehicles (EVs) in the third quarter, following a September 1 cut in forecasts.

To meet the lower end of that range, Nio is expected to deliver 8,689 EVs in September. So far in the third quarter, Nio delivered 7,931 EVs in July, up 125% from a year earlier, and 5,880 EVs in August, up 48%.

Rival Xpeng plans to produce 21,500-22,500 electric vehicles in the third quarter.

This means that Xpeng must deliver 6,246 EVs in September to meet the lower end of its targeted range. So far in the third quarter, Xpeng delivered 8,040 EVs in July, up 228%, and 7,214 EVs in August, up 172%.

Li Auto now expects to deliver 24,500 electric vehicles in the third quarter after cutting forecasts on September 20.

Thus, Li Auto must deliver 6,478 electric vehicles in September to meet its recommendations. So far in the third quarter, Li Auto delivered 8,589 electric vehicles in July, up 251%, and 9,433 electric vehicles in August, up 248%.

BYD is by far China’s largest electric vehicle maker, likely to report September sales next week.


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Nio stocks, Chinese electric car stocks

Nio shares are up 1.5% in the stock market today. Xpeng added 3.7% and Li Auto added 3%. According to MarketSmith chart analysis, Chinese EV stocks remain well below the 50-day line, as well as the 10- and 21-day lines, with no buy point in sight. The real estate group Evergrande’s crisis in China has exacerbated the problems after the country’s regulators took harsh measures against tech companies, causing a sharp sell-off in Chinese stocks.

Chinese electric vehicle startups aim to challenge Tesla (TSLA) at home and increasingly in Europe. Tesla dominates premium EV sales in China and Norway, the fast-growing EV markets. At the same time, Nio and his colleagues face growing competition from local giants like BYD.

Tesla shares rose 0.4%, holding in the buy zone. Tesla may report third-quarter global shipments as early as Friday.

BYD shares rose 2.9% near their 50-day line as they work to consolidate right at record highs.

In July and August, Li Auto surpassed sales of Nio and Xpeng, which offer all-electric vehicles. In contrast, Li Auto produces Extended Range Electric Vehicles (EREV), a type of hybrid electric vehicle that requires a smaller battery pack.

A smaller battery means lower manufacturing costs. Hybrid electric vehicles are alleviating consumer concerns about range as China begins to develop its charging infrastructure.

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