Nio (NYSE:NIO) shares rose after the Chinese electric vehicle (EV) maker unveiled its ET9 car at its Nio Day 2023 event.
The ET9 is described as an “executive sedan” and includes a self-driving chip with circuit lines just 5 nanometers apart. The price is estimated at $112,160.
The car also features a lightweight chassis and a faster charging battery, the company said.
Nio stock rose almost 5% overnight. It was due to open Dec. 26 at $8.80 per share, its market capitalization rising to $15.75 billion.
NIO Stock Is Aiming High
While the luxury end of the EV market is considered saturated, Nio’s move shows what the car maker is capable of.
The ET9 is specifically compared with the Porsche (OTCMKTS:POEHY) Panamera, a gas-powered car with prices starting at $99,000. A hybrid model of the Panamera is expected soon. BYD (OTCMKTS:BYDDF) and Geely (OTCMKTS:GELYF), which owns the majority stake in Polestar (NASDASQ:PSNY), have also launched ultra-luxury EVs lately.
After the event, Nio also confirmed plans to launch a sub-brand called Alps early in 2024. Alps models are expected to price at $28,000, while a second low-end brand called Firefly will price below that.
Nio recently got a $2.2 billion investment from the public investment fund of Abu Dhabi, giving the emirate a roughly 20% stake. The company ended September with $3.3 billion in cash. It should be able to carry out its plans through 2025 despite losing over $600 million last quarter.
Nio and BYD are leading China’s push to export EVs to Europe, a market that has been dominated by Tesla (NASDAQ:TSLA) and Volkswagen (OTCMKTS:VWAGY). Nio is “still debating” a 2025 entry into the U.S. market.
What Happens Next?
Expect rising competition as Chinese makers like Nio move to take over the EV world. Car buyers should also see some bargains. While critics claim U.S. drivers don’t want EVs, they haven’t seen many costing under $40,000 yet.
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 InvestorPlace.com Publishing Guidelines.
