NIO - Good news for Zeekr and Nio stocks; May will be key month
2024-06-03 00:04:00 ET
Nio (NYSE: NIO) and Zeekr (NASDAQ: ZK) stock prices will be in the spotlight on Monday after releasing a strong surge in vehicle deliveries. Beijing has also announced another stimulua package worth $890 million to boost the industry.
ZEEKR Intelligent Technology, a recent publicly-traded company, reported strong growth in deliveries. It delivered 18,616 vehicles in May, a 115% increase from the same period in 2023. It has now developed over 264k vehicles since inception.
Nio also reported strong deliveries numbers. It delivered 20,544 vehicles in May, a 233% annual increase. It sold 12,164 premium electric SUVs and 8,380 premium sedans. This means that the company has delivered over 65k vehicles this year and is working towards making over 200k vehicles this year.
Other Chinese EV companies reported strong deliveries. BYD delivered over330k vehicles while XPeng sold over 10,140 vehicles during the month.
These companies are benefiting from strong demand for electric vehicles in China, helped by the recovering economy, price cuts, and government subsidies. In fact, the government has announced a fresh subsidy worth $890 million.
These funds will go to customers trading in old cars and will be worth about RMB 10,000 ($1,380). On top of this, the government abolished the set minimum downpayment for car purchases, a move that can add 2 million to new vehicle purchases.
Nio vs Zeekr stocks
Looking ahead, May will be a crucial month for Nio and Zeekr as the companies are set to publish their financial results. As I wrote last week , Nio will publish the latest earnings on June 6th while Zeekr will release on June 15th.
These results will provide information about their revenue and profits/losses in the quarter. Most Chinese EV companies have seen their profits plunge as they slashed their vehicle prices to deal with the soaring competition.
Worse, their global expansion trend has come under intense pressure in the past few months. Biden has added a 100% tariff on Chinese EV companies and Donald Trump has pledged to implement a 200% tariff on Chinese vehicles manufactured in Mexico if he wins.
Europe has also been reviewing the Chinese EV industry in the past few months. It has focused on China’s subsidies, which have led to unfair competition.
Zeekr stock price has plunged by over 21% from the highest point this year. Recently, however, it has rebounded by over 13% from the lowest point in May. Nio stock has also rebounded by almost 50% from its lowest point this year.
The post Good news for Zeekr and Nio stocks; May will be key month appeared first on Invezz