What happened

Shares of Nio (NIO -0.69%) plunged by 25.1% in April, according to data provided by S&P Global Market Intelligence. The electric vehicle (EV) stock trended even lower in the following days to hit a 52-week low on May 2, but it appears to have bottomed already, as investors now find it attractively priced.

So what

Nio delivered a record number of EVs in December, but hasn't been able to sustain its momentum so far this year. In early April, Nio said its deliveries in the first quarter rose about 21% year over year. Sequentially though, its Q1 deliveries fell by almost 23%.

In between, a price war erupted in China as EV giant Tesla  aggressively slashed the prices of its vehicles. Although few EV makers reportedly joined the price war in China, steep discounts by some companies impacted sales across the industry as customers delayed purchases in anticipation of further cuts.

On May 1, Nio further spooked investors when it said it delivered only 6,658 vehicles in April, down nearly 36% from March. Its competitors fared better, with Li Auto even delivering a record number of vehicles in April.

Now what

There are a couple of things worth noting here: the real reason for Nio's low deliveries, and its ongoing growth moves.

Nio's deliveries have been slow of late because over the past few months, it has been transitioning all of its models to a second-generation platform, NT 2.0, and preparing its manufacturing lines to produce its upgraded 2023 model-year cars. That not only hindered production and sales, but also added to its costs -- which is why Nio's vehicle and gross margins fell sharply in the fourth quarter, the numbers for which were reported on March 1.

The transition is progressing well. Nio started deliveries of its coupe SUV EC7, which was launched in December, in the last week of April -- ahead of its original mid-May target. Nio also launched the 2023 ET7 sedan at Auto Shanghai in April, and expects to start deliveries this month. Its revamped 2023 ES6 SUV model is also available for pre-orders, and is expected to launch officially this month.

Long story short, with most of Nio's upgraded models hitting the market this month, its orders and deliveries should start picking up. In fact, in a media group interview held in April, CEO William Li reportedly told CnEvPost that he still expects Nio to double its sales this year versus 2022. That's encouraging, and as Nio's numbers improve, so should investor interest in the EV stock, which has lost almost half its value in the past year.