Most recent coverage of the electric vehicle race has centered around prominent American names, such Rivian (NASDAQ:RIVN) and Lucid Motors (NASDAQ:LCID). While one company saw a more difficult time last week than some of its competitors, it’s off to a much better start this week. China-based EV producer Nio (NYSE:NIO) hadn’t been trading well throughout most of November, but recent speculation has sent NIO stock shooting up as rumors of a new sedan begin to circle the web.
What’s Happening With NIO Stock
After picking up some late-week momentum last Friday, NIO stock has continued gaining steam into this week.
As of this writing, shares are up more than 7%. Since late October, though, Nio has experienced plenty of volatility with several extreme spikes and declines. With today’s strong start, though, its overall gains for the month are just shy of 5%.
These gains aren’t unique to Nio, though. Wedbush Securities analyst Dan Ives issued a report last week that took a bullish stance on the EV industry as a whole, claiming that we’re likely to see global spending on EVs throughout the coming decade reach $5 trillion. While the companies he focused on were Lucid and Rivian, this type of prediction casts a positive light on the entire EV industry. Ives also touted the potential of the EV being built by Apple (NASDAQ:AAPL), claiming we could see it as early as 2024.
The Road Ahead
What else is behind this spike in NIO stock prices? FXStreet has reported that there are multiple other factors at play. For a start, anticipation is building around the NIO ET7, the company’s latest EV. Preorders are expected to increase as the company prepares to start rolling out deliveries within the first quarter of 2022. As we saw when Lucid start shipping out vehicles to excited consumers in late October, EV rollouts can often lead to bumps in stock price. Preorders are already available through Nio’s app, and reports indicate that this addition to the company’s collection will include exciting new features.
Nio isn’t the only company in its field with good news to report, either. Fellow Chinese EV producer Xpeng (NYSE:XPEV) has just unveiled its latest model, the G9 SUV, which will be available in 2022. This model will likely be the primary competitor for Nio’s ES8. XPEV has enjoyed slightly better trading, with overall gains of 13% for the month. Its shares have only risen 3.6% on the day, though, putting it safely behind NIO stock so far.
Xpeng may have bigger things in store, though. Recent reports have indicated that the company is planning to focus on expanding globally throughout the coming year.
What It Means
The fact that Nio has risen by more than Xpeng today on only speculation seems to point toward a move in sympathy with Xpeng. Both companies, though, have plenty of potential for growth heading into 2022, as InvestorPlace contributor Bret Kenwell recently noted.
The EV race is red hot and it’s only going to heat up further as 2022 takes shape. Both XPEV and NIO stock are still trading lower than their better established American peers, but that doesn’t mean they aren’t worth watching. To the contrary, they should be on the list of everyone considering a bullish play on EVs in 2022.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.