What happened

Shares of Chinese electric-vehicle maker NIO (NYSE:NIO) were trading higher on Monday, after the company reported a strong deliveries total for July and said that deliveries of its next new model will begin in September. 

As of 11:45 a.m. EDT, NIO's American depositary shares were up about 10.4% from Friday's closing price.

So what

NIO said on Monday that it delivered a total of 3,533 vehicles in July, its second-highest monthly total ever and 322% higher than its total from July 2019, when it was bogged down in a costly recall. 

That sounds like good news, and it was. But skeptical investors might raise an eyebrow at the claim that it was NIO's second-highest monthly delivery total ever. It was, but the first-highest was in June: Month-over-month, deliveries fell 5.5%.

But hang on: NIO's statement suggested that the decline was due to a supply issue, not a demand issue. 

NIO said that it had to idle its production line for five days in July in order to set up tooling for its newest model, the coupe-like EC6 crossover. In addition, some of its suppliers are located in areas that had flooding during the month, meaning that supplies of some parts were tight. 

A blue NIO EC6, a crossover SUV with a sleek coupe-like roofline.

NIO expects deliveries of its new EC6 to begin in September. Image source: NIO, Inc.

Those parts shortages may explain NIO's deliveries mix. Deliveries of the smaller ES6 rose 5.4% from June, to 2,610, a nice increase. But deliveries of the larger ES8, which had been selling well recently, fell 27% from June, to 923. 

Long story short: Deliveries fell from June because it had fewer vehicles to deliver in July, not because demand has started to slip.

Now what

In a statement, CEO William Bin Li said that NIO did break one record in July — its monthly order growth has never been higher. That, and the company's terrific second-quarter sales result, bodes well for a positive response from auto investors when NIO reports its second-quarter earnings.

That report is scheduled to happen before the market opens on Aug. 11.

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