Shares of Chinese electric-vehicle maker Kandi Technologies (NASDAQ:KNDI) were trading higher on Monday, after the company said that it completed a key milestone in its effort to bring its electric-vehicle battery-swap technology to market.
As of 3 p.m. EDT, Kandi's American depositary shares were up about 13.4% from Friday's closing price.
In a statement, Kandi said that it had completed the delivery of its automatic battery-swap system to a ridesharing operator in China's Hainan province. The system, developed by a Kandi subsidiary, automates the process of swapping batteries on Kandi's compact K23 hatchback, the model used by the ridesharing company.
While battery-swapping hasn't yet caught on in other parts of the world, it's gaining ground in China. The basic premise is that "swapping" an electric vehicle's depleted battery pack for another that is fully charged can be done much more quickly than recharging the depleted pack, even with cutting-edge high-speed rechargers.
Kandi rival NIO (NYSE:NIO) has rolled out an extensive network of battery-swap stations in China over the last two years. As NIO has explained, the battery-swap stations will allow for a modified business model in which customers can buy electric vehicles without batteries (at substantially lower initial cost) and then subscribe to a battery-swap service, generating ongoing revenue for the automaker over time.
Kandi is clearly aiming to offer something similar. It said that its automated system can swap a vehicle's batteries in just 90 seconds, with no human intervention required.
Kandi's shares soared last week after the company said that it will begin selling two of its electric cars in the United States later this month. While the cars' feature sets and prices, and Kandi's limited service network, suggest that initial sales volumes will likely be quite limited, auto investors hoping to profit from widespread electric-vehicle adoption have been eager to snap up shares in recent days.
That eagerness may have been a big factor in Kandi's price jump on Monday.