Key points:
- Nio might be slightly lagging behind competition, but maybe for not much longer…
- The company has started production of a mass market vehicle, aiming for 60,000 annually
- With supply chain issues still remaining, will the company meet its bold claims?
Following the January EV production update, it appeared that Nio (NYSE: NIO) – once known as the Chinese Tesla – seems to be lagging behind its competitors; predominantly Li Auto, Xpeng, BYD, and Tesla. Supply issues have caused production cutbacks and even delivery cancellations across the emerging EV industry; but still, Nio’s deliveries came out shorter than the rest, despite China being the hub of the electric transformation.Â
It might not be all that bad for Nio. In fact, the company seems to be working away behind the scenes on the development of a mass-market model that will likely be introduced under a separate brand name. Development is apparently already underway at the company’s Hefei manufacturing base, with the model expected to be positioned at a lower tier than its SUV and sedan models.
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This could be a complete game-changer for Nio stock, which has been seriously struggling – losing more than half of its value throughout 2021. Nio is targeting an annual production capacity of 60,000 units, and the vehicles are expected to reach the market later this year. However, let’s not get excited just yet. Investors in tune with the EV market will know that plans, projections, and delivery dates can be inconsistent, to say the least.
Supply chain challenges and chip shortages are likely to continue throughout the most part of 2022; so Nio’s expectations come across as incredibly bold. If the company is able to meet these deadlines, a mass-market model could be the ticket to Nio’s growing slice of market share – but the company needs to act quickly.Â