After failing to reach full production capacity in December 2022, Nio (NIO) is lowering its Q4 delivery outlook, citing particular “challenges in deliveries and productions” in addition to ongoing supply chain issues.
Nio cuts Q4 2022 delivery expectations
EV pioneer, Nio, has become one of the most closely watched electric vehicle makers after fueling sales in China with new EV releases and quickly expanding its market.
Nio delivered over 91,000 EVs in 2021, including 41,474 ES6s, 29,905 ES8s, and almost 30,000 EC6s. Meanwhile, rising competition from peers like XPeng, Li Auto, Geely, and Tesla, on top of continued shutdowns in China due to the outbreak of Covid, has cooled Nio’s momentum some.
Despite achieving record quarterly deliveries of over 31,000 EVs in Q3 and a monthly delivery in November, Nio has struggled with ongoing supply chain disruptions caused by China’s “Zero-Covid” restrictions.
December in particular has presented issues as Nio struggles to reach full production capacity. In a press release today, the EV maker revealed it faced challenges in December, causing it to lower Q4 delivery guidance. Nio stated:
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. 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 company adds it now expects deliveries to be between 38,500 to 39,500 in the fourth quarter, down from the previous guidance of 43,000 to 48,000.
If this is the case, Nio will still see around a 50% increase in EV deliveries from Q4 2021’s total of 25,034.
In addition, Nio has several highly anticipated EVs it expects will help drive future demand, including its flagship EC7 coupe SUV and ES8 refresh unveiled during Nio day 2022.
Nio stock is down over 70% year-to-date (YTD), like many EV makers (and essentially all high-growth companies), but the company is still expanding its market.
In October, Nio held its European launch event in Berlin to celebrate the launch of its models in Germany, the Netherlands, Denmark, and Sweden. And a few weeks ago, the company celebrated its 300,000th Nio EV rolling off the line, an impressive accomplishment for a company that began production in May 2018.
New reports are indicating some major cities in China are ending COVID-19 restrictions, signaling the country may be easing its “Zero Covid” policies. Either way, Nio continues growing, and with several big releases coming up, the company expects to see its delivery total continue rising.
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