What happened

Chinese electric-carmaker NIO (NIO -1.14%) didn't escape last month's auto-stocks rout. The price of the company's American depositary receipts fell 32.7% in March, according to data provided by S&P Global Market Intelligence, on continued concerns about the company's cash and prospects in China's recovering economy.

So what

NIO began March the same way it had begun February: By issuing short-term convertible notes to raise $235 million, enough money to cover its payroll and expenses for a little while longer. 

NIO was close to running out of cash even before the COVID-19 outbreak in China. The company revealed in mid-March that it had just $161.7 million in cash remaining as of the end of 2019 -- enough for, at most, a couple months of operations.

A red NIO ES6, an upscale five-passenger electric SUV.

NIO's ES6 has been its best seller since its launch in mid-2019. Image source: NIO, Inc.

The company had said in late February that it was working on a deal with a municipal government that would provide it with long-term financing, but as of April 8 that deal has yet to be completed. At least one similar deal fell through last year, after officials balked at NIO's balance sheet. 

But the short-term cash raises in February and early March helped keep NIO's lights on for the time being. And there was a bit of good-under-the-circumstances news: Auto investors were heartened to learn on March 10 that the company had delivered 707 vehicles in February.

That's a tiny number, but one that represented a smaller year-over-year decline than the overall Chinese new-car market's. 

Now what

NIO's production and deliveries have continued to recover as the coronavirus outbreak has receded in China. The company said on April 7 that it delivered 1,533 vehicles in March, enough to meet its delivery guidance for the first quarter. CEO William Bin Li said in a statement that the company is still working with its suppliers to get production up to full speed, but its store traffic is picking up as the country returns to normal.