Chinese EV leader NIO (NIO) reported 10,059 deliveries of its electric models in October 2022. Although NIO’s deliveries are up over 174% from October last year, it’s a slight dip from last month. A sign of what’s to come in the Chinese EV market? Or just another speed bump on the way to rapid EV adoption?
A critical year for NIO (NIO)
Since going public in 2018, NIO has been one of the most closely watched EV companies, partly because of the company’s explosive growth and market potential in China.
In December 2017, the company launched the ES8, a premium electric SUV, which was followed by the ES6, an EV SUV, in December 2018. The EC6, an electric coupe SUV, was unveiled in December 2019. In January 2021, NIO released its flagship ET7 electric sedan, and in December 2021, the ET5 was introduced, a midsize electric sedan.
NIO delivered 91,429 electric vehicles in 2021, including 20,050 ES8s, 41,474 ES6s, and 29,905 EC6s.
However, 2022 has presented significant challenges for Chinese EV companies with ongoing lockdowns due to a resurging COVID-19 that continues to limit production.
According to the latest update from the International Council on Clean Transportation, China remains the top market for electric vehicles despite surging EV sales in Europe, with around 24% EV share of the auto market.
Several automakers and startups, such as Li Auto, Xpeng, and Geely, are fighting NIO for market share. During the second quarter, NIO’s deliveries rose 14% YOY, but the pace is slowing significantly, falling 2.8% from Q1.
The EV maker’s founder and CEO, William Bin Li, called the remainder of 2022 a “critical period” for NIO to scale production and expand its market.
NIO’s stock is down 70% year-to-date (YTD) as inflation, geopolitical tension, and regulation uncertainty has put pressure on Chinese stocks, particularly growth and tech companies.
NIO’s October EV deliveries update indicates better-than-expected results, but the slowing momentum raises questions.
NIO October 2022 EV deliveries update
According to NIO’s SEC filing, the EV company delivered 10,059 electric models in October 2022. Even though NIO’s EV deliveries represent an increase of 174.3% from October of last year, they are down 7.5% from September.
During October, NIO delivered 5,979 electric SUVs and 4,080 electric sedans, including:
- 2,814 ES7
- 3,050 ET7
- 1,030 ET5
Including October, Nio has delivered 92,493 so far in 2022, up 32% from the same time last year. Cumulative deliveries have now reached 259,563 as of October 31, 2022.
The vehicle production and delivery were constrained by operation challenges in our plants as well as supply chain volatilities due to the COVID-19 situations in certain regions in China.
To help overcome this, NIO introduced its ET7, EL7, and ET5 models in Europe to expand its market reach. The EV models will “gradually” become available in Norway, Germany, the Netherlands, Denmark, and Sweden through NIO subscriptions, leasing programs, and DTC sales.
Although NIO’s EV deliveries seem to be slowing, the EV maker is strategically growing its market by introducing several popular electric models in Europe, where demand is also rising quickly.
NIO delivered more EVs than rival XPeng (5,101) and just edged out Li Auto (10,052) in October. The EV maker continues to overcome supply chain hurdles in its home market, but the company’s widening loss is a concern.
In Q2, NIO’s loss grew to $411.7 million, an increase of 369% from 2021. NIO reports Q3 earnings on November 10. This will be a significant number to watch.
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