Nio (NYSE:NIO) stock rose slightly after announcing a safety partnership with Swedish airbag maker Autoliv (NYSE:ALV). The deal is part of how the Chinese electric vehicle (EV) maker is trying to distinguish it from local rivals.
Nio’s cars are best known for their quick battery swaps, aimed at maintaining a car’s range in the time it takes to fill up with gas.
NIO stock will open today at about $7.90, a market capitalization of $13.2 billion. Autoliv fell 3% overnight to $84.60, a market cap of $7.4 billion.
What’s Nio With You?
Big investors have been loading up on Nio stock lately, and brokers have been recommending it. This is despite the fact Nio hasn’t shown a profit and is now trailing in the Chinese luxury EV market to rival Li Auto (NASDAQ:LI).
Nio has been maintaining attention with high-profile moves like bringing its battery swaps to Europe, and investments in nuclear fusion. Nio is also working on solid-state batteries with WeLion, which could have more energy density than existing products, thus a longer range. The stock is down 18% so far in 2023.
The deal with Autoliv is aimed at creating sustainable safety gear for electric cars, including a new airbag that provides protection in different seating positions. Autoliv’s biggest customers include Stellantis (NASDAQ:STLA), Volkswagen (OTCMKTS:VWAGY), and the alliance among Renault (OTCMKTS:RNLSY), Nissan (OTCMKTS:NSANY) and Mitsubishi (OTCMKTS:MSBHF).
Nio is due to report earnings for its March quarter on June 9. Analysts expect a loss of 22 cents/share. They’re not panicked about losses since the company won local government subsidies in 2020. The company said in February it is building two new EV manufacturing plants.
NIO Stock: What Happens Next?
Nio is seeking a reputation for innovation that can make the company sustainable beyond its production of vehicles. Battery swaps, leasing deals, and a reputation for safety are all part of the package.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.