$NIO Inc (NIO.US)$ Chinese premium electric vehicle maker Ni...

$NIO Inc(NIO.US)$ Chinese premium electric vehicle maker Nio’s stock (NYSE: NIO) has declined by about 19% over the last month, considerably underperforming the S&P 500 which remained roughly flat over the same period. The decline follows the company’s lighter than expected delivery guidance for Q4 (see below) and broader selling pressure in U.S. listed Chinese stocks after ride-hailing firm Didi Chuxing indicated that it intends to delist from the NYSE less than six months after going public, amid regulatory pressures in both the U.S. and China. However, the longer-term outlook for Nio hasn’t really changed in our view, and the current issues appear to be only transitory. Demand for EVs in China remains strong, and Nio is looking to bolster its production capacity at its Hefei plant to 240,000 vehicles a year by the first half of 2022. The company is also expanding its product line, with its first sedan, the ET7, likely to begin deliveries as soon as the first quarter of next year, with two other models also in the pipeline for a 2022 launch. This should set Nio up for solid growth in the coming years.