Nio managed to grow deliveries of its electric vehicles in August versus July. Nevertheless, rivals Li Auto and Xpeng saw a pointy fall in deliveries. EV players proceed to face supply chain disruptions for the resurgence of Covid in China in addition to weaker consumer demand on account of a difficult economic environment within the country.
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Stocks of Chinese electric vehicle makers Nio, Li Auto and Xpeng tanked on Thursday after the latter two start-ups reported a pointy fall in August automobile deliveries.
Listed here are the August delivery numbers for the three corporations:
- Li Auto: Delivered 4,571 vehicles in August, down 56% versus July’s variety of 10,422 cars. That figure can be down 51% year-on-year.
- Xpeng: Delivered 9,578 vehicles in August, down 16% versus July’s variety of 11,524 cars. Nevertheless, that represents a 33% year-on-year rise.
- Nio: Delivered 10,677 vehicles in August, up 6% versus July’s variety of 10,052 cars. That was also a 81.6% year-on-year rise.
Nio was the one company to grow on a monthly basis in August but U.S.-listed shares of the EV start-up closed over 5% lower. Li Auto shares fell 3% while Xpeng was slumped greater than 6%.
In Friday morning trade, Hong Kong-listed shares of Nio and Li Auto slipped 0.6% and 0.3%, respectively. Xpeng shares in town fell 2%.
The Chinese economy is facing various challenges including a resurgence of Covid-19 that has seen major cities like Shanghai locked down. In the previous couple of days Shenzhen, China’s tech hub has enacted Covid restrictions and on Thursday, the mega city of Chengdu went into lockdown.
While some cities could have opened up again, consumer sentiment stays fragile and uncertainty prevails because of this of China’s “zero-Covid” policy.
The world’s second-largest economy can be facing an influence crunch which is impacting electric vehicle charging stations. Last month, Tesla and Nio suspended a few of their charging services.
These issues are filtering through to EV sales.
Read more about electric vehicles from CNBC Pro
Bill Russo, CEO at Shanghai-based Automobility, told CNBC, the numbers are “reflective of lingering supply chain issues in addition to the proven fact that they’re on the premium end of the worth range and with the weakening economy, persons are looking toward affordability and that is squeezing among the higher priced models.”
Last month, Xpeng said it expects to deliver between 29,000 and 31,000 electric vehicles within the third quarter of the 12 months. This guidance disillusioned investors.
Xpeng President Brian Gu said the guidance reflects the proven fact that the industry is entering a “relatively slow season” and that traffic in stores is less on account of the Covid situation.
Yanan Shen, president of Li Auto, said in an earnings call last month that the Covid outbreak “severely affected” the corporate’s supply chains and that there are remaining “disruptions and difficulties.”
Shen also said there had been a slowdown so as intake for its flagship Li One sports utility vehicle.
Li Auto began to deliver its recent L9 automobile to customers at the top of August. And the corporate said it’s planning to launch and deliver a big SUV called the Li L8 in early November. That may very well be affecting sales of its Li One, in response to Russo.
“Li has major recent product launches with the L9 and L8 which can be impacting consumer demand for Li One. When recent products come out, demand for the older model often suffers,” Russo said.
To spur demand, China said last month it might extend its tax exemption for brand new energy vehicle purchases until the top of 2023.
Competition continues to heat up in China’s electric vehicle market. Alongside Li Auto’s recent cars, Xpeng plans to start deliveries of its recent G9 SUV in October and launch two recent vehicles next 12 months.