After the maker of electric vehicles reduced its delivery estimates, Nio stock falls

After the maker of electric vehicles reduced its delivery estimates, Nio stock falls

After the China-based manufacturer of electric vehicles announced on Tuesday that it was “prudently” reducing its estimate for deliveries in the fourth quarter, citing COVID-related production difficulties and ongoing constraints in the supply chain, Nio Inc.’s shares plunged.

Early on Tuesday, the company NIO, -8.30% said that it now expects to deliver 38,500 to 39,500 vehicles in the fourth quarter, down from 43,000 to 48,000 vehicles in the previous guidance.

“In December 2022, the company has been facing challenges in deliveries and productions, together with certain supply chain constraints, caused by the outbreak of the omicron coronavirus variant in major cities in China,” Nio said in a statement. “While our teams have strived to maintain continuous operations on all fronts, we were not able to reach our full capacities, particularly when there have been disruptions on delivery and registration procedures involving users.”

China began ending its two and a half-year zero-COVID policy in an effort to halt an economic downturn, which led to the increase in cases.

On Tuesday, Nio’s stock fell 8.3% to $10.06, its lowest close since November 22.

Among rival China-based electric vehicle manufacturers, shares of XPeng Inc. XPEV, -2.58% decreased by 2.6% to $9.80, and those of Li Auto Inc. LI, -1.23% decreased by 1.2% to $18.54.

For the seventh time in a row, shares of Tesla Inc. TSLA, -11.41%, which derived approximately 24% of its total revenue for the third quarter from China, were down 11.4%. The electric vehicle manufacturer with headquarters in Texas announced over the weekend that it extended the suspension of production at its Shanghai plant in response to an increase in COVID infections.

Over the past three months, shares of Nio have lost 41.5 percent, while those of XPeng have lost 28.5 percent, Li Auto has lost 279.9 percent, and Tesla has lost 61.4 percent. In correlation, the iShares China Enormous Cap trade exchanged store FXI, +4.75% has acquired 9.8% and the S&P 500 list SPX, – 0.40% has attached 5.0% the beyond 90 days.