Nio (NYSE:NIO) stock opened higher by more than 6% today after the Chinese electric vehicle (EV) company reported October deliveries. For the month, deliveries totaled 10,059 vehicles, up 174.3% year-over-year (YOY). Of the deliveries, 5,979 were attributed to premium smart electric SUVs while the remaining 4,080 were premium smart electric sedans. That brings total year-to-date (YTD) deliveries to 92,493 vehicles, up 32% YOY.
Shares of the EV company are trading higher despite the somewhat disappointing delivery figure. During September, Nio delivered 10,878 vehicles, meaning October deliveries fell about 8% month-over-month (MOM).
Investors had expected a higher October figure since deliveries for the ET5 sedan began in late September. Further, the company unveiled its ET7, EL7 and ET5 models to Europe at the NIO Berlin 2022 event in early October. These models will be “gradually made available” in Norway, Germany, the Netherlands, Denmark and Sweden through direct sales, subscriptions and leasing programs.
NIO Stock Trades Higher on October Deliveries Update
In the October delivery update, Nio added that “vehicle production and delivery were constrained by operation challenges in our plants as well as supply chain volatilities due to the COVID-19 situations in certain regions in China.”
The EV company also provided clarity on its delivery figures. Vehicles sold or leased in Europe count toward monthly deliveries. Meanwhile, vehicles acquired through the subscription program are not included in monthly deliveries but instead recognized as assets on the balance sheet.
That said, October’s delivery update has some investors nervous that Chinese demand is weakening. Delivery updates from competitors have also been somewhat disappointing, contributing to the weakening demand thesis. Li Auto (NASDAQ:LI) recently posted deliveries of 10,052, down 13% from 11,531 vehicles in September. XPeng (NYSE:XPEV) also reported 5,101 vehicle deliveries this past month, down 40% MOM from 8,468 vehicles. Tesla (NASDAQ:TSLA) recently announced price cuts for its Model 3 and Model Y vehicles in China as well, with both price tags now below $40,000. These cuts partially reversed price hikes enacted earlier this year.
Finally, President Xi Jinping successfully secured a third term last month, sending Chinese stocks lower across the board. Investors were worried that Xi Jinping would continue strict crackdowns on tech companies as well as his stringent Covid-19 lockdown policies. This has contributed to NIO stock’s decline of more than 30% during the past month.
On the date of publication, Eddie Pan did not hold (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.