Chinese electric carmaker NIO on Thursday reported 3,553 vehicle deliveries for the second quarter of 2019 on the back of rising demand for the latest NIO ES6 sports utility vehicle (SUV). The ES6 began shipping to consumers in June, reports Yahoo Finance.
After a disappointing first quarter in 2019, NIO stock has rallied beginning this month, closing at $3.48 by end of trading on Friday. The surge represents a cumulative increase of more than 50 percent in share value over the course of the past week.
NIO stock has also increased in value in the wake of record delivery numbers released by American EV maker Tesla earlier this month. Often called the “Tesla of China,” NIO has registered its biggest gains so far in July 2019 since going public back in late 2018.
The ES6 model could put the Shanghai-based electric vehicle maker on the path to recovery after a slump in the stock price over the past six months due to slowing demand for EVs, executive departures. battery fires, and competition from foreign corporations.
The ES6 is a five-seater SUV that offers better battery performance than the ES8 model and is cheaper than the latter as well. The interior of the EV has been scaled up to meet the demands of wealthy consumers after NIO received complaints about the build quality of previous models.
Last month, NIO was forced to recall close to 5,000 ES8 models over complaints of battery fires. According to a report on the technology news site The Verge, NIO sold close to 17,000 ES8 models in China. However, the company said only a fraction were affected by battery fires.
The troubles for NIO have been steadily increasing since the head of the United States division of the company, Padmasree Warrior, quit in November 2018. Amid slowing demand at the turn of the year, the departure hit the company hard.
Competition from the likes of Tesla entering the Chinese market and the scaling back of EV subsidies by Beijing in past months could still impact recent strides made by NIO. However, the entry of the company into new markets like Europe could offset some of these setbacks.
Usman Kabir covers science, space, and technology for Globely News. As a kid, he would make models of the solar system and take part in water rocket competitions. His childhood obsession has led him to a degree in Space Science. Usman likes to spend his free time watching reruns of "Curb Your Enthusiasm" and "Seinfeld."