NIO Stock – Why NIO Stock Is Higher Today
Shares of NIO (NYSE: NIO) were moving greater on Monday after the Chinese electric-vehicle maker stated that its production partner had consented to increase its manufacturing capacity to build up to 240,000 NIOs annually.
Since 1:15 p.m. EDT, NIO‘s American depositary shares were up about 5.7% from Friday‘s closing cost.
Some background: NIO doesn’t have a manufacturing facility; its cars are made under contract by a joint venture with government-owned automaker Jianghuai Car Team, or JAC, in a JAC-owned factory in the commercial city of Hefei, near NIO‘s headquarters.
NIO said on Monday morning that it has signed a new three-year agreement with JAC to proceed that setup through ( at the very least) May of 2024. As part of the bargain, JAC has consented to enhance the manufacturing ability of the factory to 240,000 automobiles per year, or 20,000 monthly— double its present capacity. NIO Stock.
NIO as well as JAC didn’t claim when that capacity increase will certainly be in area, however the news is likely why NIO stock is trading greater today.
Auto financiers who adhere to NIO stock know that the business has actually been functioning because late in 2014 to increase result at JAC‘s manufacturing facility amidst fast-rising need for its fashionable electrical SUVs. The company was able to boost the production rate from about 5,000 lorries a month to 7,500 monthly in very early January and has pushed it higher considering that.
At a ceremony to mark the 100,000 th NIO built at the manufacturing facility in very early April, CEO William Li Bin stated that the manufacturing facility can now build about 10,000 NIOs per month. Yet, Li stated, manufacturing has yet to hit that figure due to an continuous international lack of auto semiconductors.
NIO stock and also most other affected automakers now expect the chip scarcity to last into 2022, though supplies are expected to improve rather in the second half of this year.
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