What happened
Shares of Chinese electric vehicle (EV) maker NIO (NIO 4.07%) were up more than 20% this week before reversing course late Thursday. The stock still looks to end the week up double digits, as NIO's vehicle deliveries set records in June and the second quarter.
So what
A stock market rotation away from high-growth names like EV makers, and into value and cyclical companies, started to reverse in recent weeks, bringing stocks like NIO back from recent lows. In addition to general market sentiment this week, there was a positive note from a Citibank analyst as well as strong delivery numbers from the automaker. This comes as the company gets ready to introduce its first luxury sedan early next year. It is also preparing to sell into its first market outside of China as it sets up its business in Norway.
NIO ES8 electric SUV. Image source: NIO.
Now what
On Thursday, NIO said its June vehicle deliveries jumped 116% year over year, and sales also more than doubled for the quarter, which ended June 30. Deliveries of over 8,000 were a new monthly record for the company. Sales in the quarter were also a new record at almost 22,000. By comparison, for the full-year 2020, NIO delivered just under 44,000 vehicles.
Upcoming highlights for investors will include the introduction of NIO's ET7 sedan. The high-end EV will be available starting in early 2022, and is NIO's first sedan design. It currently offers only SUV models. Prior to that, NIO plans to start selling vehicles in Europe this fall, beginning with its flagship ES8 SUV in Norway. The company also will establish a full ecosystem in the country, including its unique battery-charging and swap stations and a service network.
As sales continue to grow and the company announces plans to expand in both production and geographic reach, investors are regaining interest in the stock after an approximately 50% drop earlier in 2021. This week's move has continued that recent trend.
