Yesterday, Chinese electric-vehicle (EV)-maker Nio (NIO 0.72%) announced that vehicle deliveries in April declined from March 2022 levels. The really surprising news was just how much as they dropped 28.6%, compared to April 2021. That seems significant, given that Nio's production has shown a sharp growth trajectory over that period.
Investors seemed to give them a pass at first, as shares jumped yesterday. But today, Nio shares dropped as much as 3.1% in early trading before rebounding to a gain of 0.5% as of 3 p.m. ET.
The change of opinion since yesterday may have come as investors digested the April delivery news, especially in comparison to its domestic competition. Peer XPeng (XPEV -2.82%) experienced similar headwinds in April but reported that deliveries jumped 75% year over year.
In the big scheme of things, one month doesn't define how an investment or the business behind it might perform. Nio cited supply-chain and logistics troubles stemming mainly from Chinese city lockdowns, enforced to control a recent COVID-19 wave, for its April performance. The company said production is gradually ramping back up as it obtains needed parts.
XPeng also acknowledged the supply-chain challenges and the continued COVID-19 situation. But the company noted that it was able to continue its strong production performance, stating, "April deliveries reflect the company's relentless effort to mitigate the current conditions with support from various authorities and industry partners."
Investors today may have read that report as a competitor performing better than Nio in April. While that looked to be the case, the supply-chain situation should resolve itself and not linger too long. That may be why shares recovered, as the long-term story isn't determined from a single-month's performance, even if the company's shares were outperformed by a competitor last month.