Shares of Nio Inc. took a dive Tuesday, after the China-based electric vehicle maker said it was “prudently” cutting its fourth-quarter deliveries estimate, citing COVID-related production challenges and continued supply chain constraints.
said early Tuesday that it now expects to deliver 38,500 to 39,500 vehicles during the fourth quarter, down from a previous guidance range of 43,000 to 48,000 vehicles.
“In December 2022, the company has been facing challenges in deliveries and productions, together with certain supply chain constraints, caused by the outbreak of the omicron coronavirus variant in major cities in China,” Nio said in a statement. “While our teams have strived to maintain continuous operations on all fronts, we were not able to reach our full capacities, particularly when there have been disruptions on delivery and registration procedures involving users.”
The surge in cases comes after China starting moving on from its 2 1/2-year-long zero-COVID policy, in an effort to stem an economic downturn.
Nio’s stock slumped 4.9% in premarket trading Tuesday, putting it on track to open at the lowest price seen during regular-session hours since Nov. 29.
Among rival China-based EV makers, shares of XPeng Inc.
dropped 1.6% and Li Auto Inc.
Shares of Tesla Inc.
which generated about 24% of its total third-quarter revenue from China, took a 4.9% hit ahead of the open, putting them in danger of a seventh-straight loss. The Texas-based EV maker said over the weekend that it extended the production suspension at its plant in Shanghai, as COVID infections surged.
Nio’s stock has lost 36.2% over the past three months through Friday, while shares of XPeng have slid 26.6%, Li Auto have declined 27.0% and Tesla have tumbled 56.5%. In comparison, the iShares China Large-Cap exchange-traded fund
has gained 4.8% and the S&P 500 index
has tacked on 5.4%.