Electric vehicle manufacturer Nio posted losses that were narrower than expected for the third quarter of 2021 thanks to growing demand for the automaker’s cars. It delivered 24,439 vehicles in Q3, beating analyst estimates of 22,980 units, doubling from a year earlier. Nio also expects its Q4 deliveries to be stable, even though it faces a number of supply chain challenges.
The company logged net losses of RMB 835.3 million (USD 130 million) in the three months ended September 30, compared to a RMB 1.05 billion (USD 164 million) shortfall one year earlier. Quarterly revenue surged to RMB 9.81 billion (USD 1.53 billion), up 116.6% from the same period last year and 16.1% more than Q2. This exceeded analyst estimates of RMB 9.2 billion in revenue, according to data compiled by Visible Alpha.
Nio is confident about addressing supply chain challenges in the final quarter of the financial year. It expects to deliver between 23,500 and 25,500 vehicles in Q4. Total revenue is expected to be between RMB 9.38 billion and RMB 10.1 billion (USD 1.46–1.58 billion), remaining flat with Q3.
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“Our demand continues to be strong, and our new orders reached a record high in October,” Nio’s founder and CEO William Li said in a statement. “Despite the continued supply chain volatilities, our teams and partners are working closely together to secure the supply and production for the fourth quarter of 2021,” said Li.
Notably, Nio’s October deliveries plunged 65% to just 3,667 vehicles due to unstable supply chain provisions and upgrades that were made to its manufacturing lines. In the same month, Nio’s two major rivals in China, Li Auto and Xpeng, both reported stronger sales.
Nio said it is on track to launch three new models in 2022 as the production line upgrades have increased its manufacturing capacity, Li said during the company’s earnings call on Wednesday.
The three new vehicles will be available in five European countries in 2022, as Nio has ambitions to establish a foothold in the European market. Nio is already selling its electric SUV model, the ES8, in Norway. The company did not disclose the five countries where it plans to develop its business.
Nio’s shares on the New York Stock Exchange closed with a 5.9% drop on Tuesday. Some analysts cite the Tesla effect, where the American EV maker’s stock price movements pull and drag those of other companies in the same sector.