The company’s announcement of a new car model drove investors into the stock.
Several factors converged this week to make Chinese vehicle manufacturer Nio (NIO 1.97%) a popular stock in the somewhat battered electric vehicle (EV) sector. Almost unarguably the major one was the announcement of a new vehicle, although Tesla‘s (TSLA 3.49%) latest stumbles also played a role.
It was an eventful few days for Nio, and since these developments were positive the stock rose. It ended the week more than 12% higher in price, according to data compiled by S&P Global Market Intelligence.
Now rolling out of the factory…
That new model is the ONVO L90, the rollout of which Nio incorporated into a press release touting the production of its 800,000th vehicle. The company described the ONVO L90 as a product that “redefines the family oriented three-row electric SUV.”
Image source: Getty Images.
It is to be made available for delivery starting Aug. 1 in Nio’s native China, and it will retail for the equivalent of $27,000 for a battery-as-a-service version and $39,000 for a complete model.
The introduction of a new vehicle by a carmaker is always attention-grabbing, and often happy news for investors.
Timing mattered with this announcement, as it contrasted with Tesla’s fairly grim second-quarter results. The American company, still the global flag-bearer for EVs, reported double-digit falls in revenue, deliveries, and profitability for the period.
A serious up-and-comer
Nio is doing a fine job leveraging its advantages, such as the Chinese government’s zeal for next-generation transport solutions, and its growing presence in an economy that is still on the rise (albeit not as powerfully as it was several years ago). Investors, I believe, were right to be cheered by the company’s upcoming rollout.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.