NIO Stock – Why NIO Stock Is Higher Today
What occurred
Shares of NIO (NYSE: NIO) were relocating greater on Monday after the Chinese electric-vehicle manufacturer claimed that its manufacturing partner had actually accepted increase its production capability to develop to 240,000 NIOs annually.
As of 1:15 p.m. EDT, NIO‘s American depositary shares were up about 5.7% from Friday‘s closing cost.
So what
Some history: NIO does not possess a manufacturing facility; its vehicles are made under contract by a joint endeavor with government-owned automaker Jianghuai Car Group, or JAC, in a JAC-owned manufacturing facility in the commercial city of Hefei, near NIO‘s headquarters.
NIO said on Monday morning that it has signed a brand-new three-year agreement with JAC to proceed that plan with ( a minimum of) May of 2024. As part of the offer, JAC has actually agreed to enhance the manufacturing capability of the manufacturing facility to 240,000 automobiles each year, or 20,000 each month— dual its present capacity. NIO Stock.
NIO and also JAC didn’t state when that capability rise will be in place, yet the statement is most likely why NIO stock is trading higher today.
Currently what
Car capitalists who follow NIO stock know that the company has been working considering that late last year to increase result at JAC‘s factory amid fast-rising need for its elegant electrical SUVs. The firm had the ability to raise the manufacturing rate from about 5,000 lorries a month to 7,500 per month in very early January and also has pressed it higher since.
At a event to mark the 100,000 th NIO built at the factory in early April, Chief Executive Officer William Li Bin claimed that the factory can currently construct regarding 10,000 NIOs each month. Yet, Li stated, manufacturing has yet to hit that number as a result of an ongoing worldwide lack of automobile semiconductors.
NIO stock as well as most various other affected automakers now anticipate the chip lack to last right into 2022, though materials are expected to enhance rather in the second half of this year.
