NIO Stock Alert: The $3 BILLION Reason Nio Is Down Today


  • Nio (NIO) may raise another $3 billion after just selling $1 billion in convertible notes.
  • The company’s sales are growing fast, and European regulators are worried.
  • A new smartphone will deliver limited self-driving capabilities.
NIO stock - NIO Stock Alert: The $3 BILLION Reason Nio Is Down Today

Source: Andy Feng /

Speculation that Chinese electric vehicle (EV) maker Nio (NYSE:NIO) may raise another $3 billion after just raising $1 billion in convertible notes sent NIO stock down in pre-market trading.

Nio dropped over 5% over the weekend. It opened this morning at just over $8 per share and a market capitalization of $15.6 billion. On Sept. 12, it was trading at over $10 per share. Nio had $4.3 billion in cash at the end of June.

The new cash raise is still just a rumor, reported by Bloomberg.

I Need Cash Now!

Of the three biggest Chinese EV makers traded on Wall Street, Nio is the one most focused on the export market.

In its case, that means building expensive battery swap stations in target markets. A big selling point for its cars is that batteries can be changed out in just a few minutes, maintaining their range.

Chinese companies have been taking market share in Europe, and officials are looking at tariffs to stem the tide. Nio CEO William Li has called for “open minds” on the issue. He notes electric vehicles are better for the environment than the gas-powered cars still made by European makers.

European Commission President Ursula von der Leyen has said state subsidies are artificially suppressing Chinese EV prices. Li said other factors are involved.

The controversy is occurring while Nio is also launching its own Android smartphone in China. The phone includes a button that acts as a key for the car. The phone also offers limited self-driving capabilities, so it can draw the car to its driver. 

Polestar (NASDAQ:PSNY), controlled by China’s Geely (OTCMKTS:GELYF), plans to launch a similar phone later this year.

Nio delivered a total of 19,329 cars in August. It is now 32% ahead of its delivery pace last year.

NIO Stock: What Happens Next?

Investors need to watch closely for the dilution caused by new stock issues and the growing tension with European regulators. But all Chinese EV companies will eventually be coming for Western markets.

As of this writing, Dana Blankenhorn 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 Publishing Guidelines.

Article printed from InvestorPlace Media,

©2023 InvestorPlace Media, LLC