Electric vehicle manufacturer Nio (NYSE:NIO) has taken multiple blows this week and its valuation has suffered as a result. Investors are wondering whether to take on long-term bearish attitudes toward the Chinese EV company. Others are hoping to see a turnaround in NIO stock after some hopeful news.
While the chip shortage has been battering the auto industry for some months now, Nio and other EV companies are being hit especially hard. Selling pressure from the shortage is sinking NIO stock’s value.
Additionally, the company is suffering from the adverse effects of the U.S.-China trade talks that happened a week ago. President Joe Biden’s hard stance on detangling the American economy from China is accompanying some punishing hits to Chinese companies by the U.S. Securities and Exchange Commission.
The SEC is adopting a Trump-era law’s measures this week. These measures aim to force American-listed Chinese companies to comply with U.S. auditing standards. Companies that do not comply with these standards could face delisting.
Nio has not been delisted, and there is not yet reason to believe the EV company will not comply. Still, many investors are panic-selling their shares, tanking the price of NIO stock.
Battery News Looks to Reinvigorate NIO Stock
Nio is fighting the recent losses with some news that looks to re-instill faith in investors. The company announced on Wednesday that it has reached the milestone of 2 million battery swaps in its battery swapping stations.
The swaps have reduced carbon emissions by over 26 thousand tons since the service was introduced in 2014. The company hopes to see these statistics grow greatly as it partners with the Chinese government to expand the network of swapping stations.
Furthering the good news is the leaked report that second-generation swapping stations will come in two models. Some of the updated stations will allow users to swap the battery without having to leave their car.
The news shows promise for the company in turning around. The new technologies and great PR for Nio through its battery swapping milestone remind investors that the company is still on the cutting edge of EV manufacturing.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article.
