NIO Q3 Earnings

3 Top Competitors To NIO In The EV Space

NIO has electrified the Chinese EV market with its high-tech cars, but which of these top 3 competitors should NIO be worried about?

NIO (NYSE: NIO) is currently a force to be reckoned with, particularly as its popularity has surged over the last year, with many now dubbing the EV maker as the ‘Tesla of China’. But as more and more consumers are opting to buy sustainable electric cars, the EV market is exploding in both growth and players. So, here are the top 3 competitors to NIO right now. 

1. Lucid Motors

Lucid Motors — currently waiting to merge with Churchill Capital IV (NYSE: CCIV), at which point it will trade under the symbol ‘LCID’ — was founded in 2007 as Aviera, a company that built EV batteries and powertrains for vehicle manufacturers. In 2016 it rebranded, becoming Lucid Motors, and announced its plans to become a fully-fledged car manufacturer itself. Lucid Motors could be a competitor to NIO as an alternative to Tesla, making it very difficult for NIO to expand from China to the U.S. 

The company will be going public via reverse merger on July 23 and it has a very good outlook. Currently, its premium Lucid Air Dream car has amassed over 7,500 reservations before it has even been released. The price tag comes in at $160,000 which will bring in $650 million in revenue once released. The car itself has the longest range, the quickest charge, and can go from 0-60 in 2.5 seconds.

For the future, the company plans to sell energy storage solutions using its expertise in battery tech to expand in this direction. On the car front, it should start producing more affordable cars as its brand equity and in-house technology grow. Indeed, one very optimistic prediction is that the company will reach a trillion-dollar valuation by 2040. 

2. Tesla

Tesla (NASDAQ: TSLA) is the top dog when it comes to the EV world. Although it has its fair share of critics, the company always seems to exceed expectations. In its Q1 results, the EV giant received $518 million in revenue from regulatory credits sales, up 46% YoY. Furthermore, Tesla sold $272 million worth of cryptocurrency during the quarter, resulting in a profit of $100 million. Indeed, its adjusted earnings per share were $0.93 for the quarter, up 304% year over year (YoY).

For Q2, although its earnings are not yet released, the company has announced that it produced and delivered over 200,000 vehicles, 20,000 more than the previous quarter and up 122% YoY. 

It has done all this with several setbacks in the last year, from the semiconductor shortage to its need to prepare for a future loss in regulatory credits as Fiat Chrysler and PSA’s merger will reduce its regulatory credit revenue by $200 million per year. 

Despite this, Tesla has smashed all expectations over the past year, and as such its stock has soared. It seems like this will continue to be NIO’s biggest competition in China and across the world if NIO decides to expand further on a global scale. 

3. Xpeng

Xiaopeng Motors (NYSE: XPEV) is another EV maker based in China. It serves as a competitor to both Tesla and NIO. For NIO in particular, it is currently operating in the same two countries, China and Norway. For both of these companies, this is a great gateway into the European Market. Xpeng went public in the U.S. last August and recently went public in Hong Kong this July. 

The company has produced two electric vehicles since 2018, the G3 SUV and the P7 Sedan, both of which are strikingly similar to Tesla’s Model Y and Model 3 Sedan respectively. The company is now also producing a new sedan, the P5, which will undercut Tesla’s price with a starting price of $24,700 and with the use of Xpeng’s advanced self-driving tech.

In the past this southern Chinese EV-maker has had some business in the U.S., operating a subsidiary and holding a permit in California to carry our self-driving tests on its cars. With technology like this, the company should be able to keep up with the likes of Tesla and NIO who are major automotive players. As for expanding its EV business to the U.S., there is no plan in the pipeline just yet, but with its large funding rounds and public debut on the U.S. stock market which brought in $1.5 billion, it could be an encouraging prospect to branch into this country.


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