NIO Stock – Why NIO Stock Is Higher Today
Shares of NIO (NYSE: NIO) were moving higher on Monday after the Chinese electric-vehicle manufacturer said that its manufacturing companion had consented to increase its manufacturing capability to build up to 240,000 NIOs annually.
Since 1:15 p.m. EDT, NIO‘s American depositary shares were up around 5.7% from Friday‘s closing cost.
Some background: NIO does not have a manufacturing facility; its cars are produced under contract by a joint endeavor with government-owned automaker Jianghuai Car Group, or JAC, in a JAC-owned factory in the commercial city of Hefei, near NIO‘s head office.
NIO claimed on Monday morning that it has actually authorized a new three-year contract with JAC to continue that setup with (at least) May of 2024. As part of the offer, JAC has accepted enhance the production capability of the manufacturing facility to 240,000 vehicles annually, or 20,000 per month— dual its present ability. NIO Stock.
NIO and also JAC really did not claim when that ability rise will certainly be in area, but the announcement is likely why NIO stock is trading higher today.
Automobile financiers who adhere to NIO stock understand that the firm has been functioning since late in 2015 to enhance outcome at JAC‘s manufacturing facility in the middle of fast-rising need for its trendy electric SUVs. The business was able to increase the manufacturing price from about 5,000 lorries a month to 7,500 each month in very early January and has pressed it greater because.
At a event to note the 100,000 th NIO developed at the factory in very early April, Chief Executive Officer William Li Bin claimed that the manufacturing facility can currently develop about 10,000 NIOs per month. However, Li stated, production has yet to hit that figure due to an continuous global lack of auto semiconductors.
NIO stock and most various other affected automakers currently anticipate the chip scarcity to last into 2022, though materials are expected to enhance rather in the 2nd half of this year.