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China EV Rivals See Unexpected Reshuffling In July Sales

Li Auto (LI) and Xpeng Motors (XPEV) outsold Nio (NIO) in July for the first time amid supply-chain disruptions and competitive price cuts. Nio stock rose along with other China EV stocks.

Year over year, Nio sales leaped 125% to 7,931 electric vehicles in July. But month over month, Nio’s EV sales fell 2%, including drops for its ES6 and EC6 SUVs while the larger ES8 SUV saw a gain.

Xpeng’s July sales jumped 228% year over year to 8,040, also rising 22% from June.

But last month’s sales leader was Li Auto, whose sole EV, the Li One, is a hybrid SUV. Li’s July sales vaulted 251% year over year to 8,589, growing 11% from June.

Citigroup analyst Jeff Chung tied Nio’s lackluster EV sales to Tesla (TSLA). The “trend for ES6 and EC6 is likely due to the recent price cut of Tesla’s Model Y,” Chung wrote in a Monday report.

Meanwhile, local Chinese media tied Nio’s sluggish July sales to floods in Germany that affected the supply of air suspension shock absorbers and, in turn, Nio’s production capacity. Nio reports Q2 results on Aug. 11.

Sales by China’s BYD (BYDDF), one of the world’s largest electric vehicle makers, are awaited. Warren Buffett-backed BYD’s sales of plug-in hybrid and electric vehicles soared 207% to 40,116 units in June, crossing the 40,000 mark for the first time, while increasing 27% from May.


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Nio Stock, China EV Stocks

Shares of Nio rose 2% to 45.72 on the stock market today, retaking the 200-day line intraday after topping the 50-day line Friday. Li Auto and Tesla climbed 5% Monday. Xpeng popped nearly 6% and BYD 7.4%. Excluding BYD, China EV stocks including Nio stock remain in a severe bear market with no buy point in sight, according to MarketSmith chart analysis.

China EV stocks Nio and Xpeng are looking to bring their most advanced and technically ambitious EVs yet to market, hoping to shake Tesla’s dominance in China. Li Auto also plans to expand its vehicle lineup with new pure electric and hybrid EVs.

On Monday, Xpeng detailed that it will launch its third EV, the P5 electric sedan, in Q3 with deliveries expected to begin in Q4. And the P5, “the world’s first mass-produced smart EV equipped with auto-grade LiDAR technology … is already generating an enthusiastic response from consumers in the presale phase,” Xpeng added.

Nio’s ET7, its fourth EV and first sedan, will arrive in Q1 2021. The ET7 also will offer highly autonomous driving capabilities.

Find Aparna Narayanan on Twitter at @IBD_Aparna.

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