A Covid outbreak in China, which forced production closures, weighs on April’s output figures for electric car manufacturers.
Hector Retamal / AFP via Getty Images
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Chinese electric car manufacturers
NIO
,
XPeng
and
Li Auto
reported April deliveries Sunday morning. The numbers are not very good. It gives
Tesla
investors something else to worry about.
NIO (ticker: NIO) delivered 5,074 vehicles in April, a decrease from about 10,000 delivered in March and a decrease from about 7,100 delivered in April 2021.
Looking ahead, Wall Street expects the NIO to deliver around 31,000 vehicles in the second quarter, up from around 26,000 delivered in the first quarter of 2022. This is not a good start.
Covid seems to be the cause. “At the end of March and April 2022, the company’s vehicle production and supply have been affected by supply chain volatility and other constraints caused by a new wave of COVID-19 outbreaks in certain regions of China,” the NIO said in a statement.
This is not a surprise. Investors have known about Covid-related manufacturing problems in China for weeks. Covid lockdowns in Shanghai, for example, closed Tesla’s plant in the area for several weeks, costing Tesla (TSLA) perhaps 15,000 vehicle deliveries in the first quarter of 2022. Tesla ended up delivering about 310,000 vehicles, up from the 309,000 delivered in the fourth quarter 2021
Li Auto (LI) delivered 4,167 vehicles in April, down from about 11,000 delivered in March and down from about 5,500 delivered in April 2021.
Looking ahead, Wall Street expects Li sales to grow to around $ 1.9 billion in the second quarter, up from around $ 1.5 billion expected in the first quarter. Li delivered nearly 32,000 vehicles in the first quarter of 2022.
Li also spoke of Covid in its press release: “The Covid-19 resurgence in the Yangtze Delta region has continued to cause severe industry-wide supply chain, logistics and production disruptions since the end of March.” Li makes cars in Changzhou, in the center of the region, and gets most parts for his cars locally.
XPeng (XPEV) results look a little better than Li or NIO numbers. XPeng delivered 9,002 vehicles in April, down from around 15,000 vehicles delivered in March but up from around 5,000 delivered in April 2021.
Looking ahead, Wall Street expects XPeng sales to grow to around $ 1.3 billion in the second quarter, up from around $ 1.1 billion expected for the first quarter of 2022. XPeng delivered nearly 35,000 vehicles in the first quarter of 2021
XPeng also referred to Covid in its press release.
Together, the three delivered about 18,000 vehicles in April. It is the worst monthly result since May 2021 and below the approximately 21,000 combined vehicles delivered in February 2022 – when the Chinese lunar New Year holiday affected the results. But the lining is year-to-date, deliveries have increased by 73% year-over-year, driven by gains from Li and XPeng.
Li Auto shares fell 0.6% in pre-market trading on Monday, while XPeng rose 1.1% and Nio fell 0.4%.
The shares of the three companies have already been heavily beaten up. When the NIO, XPeng and Li shares go up on Monday, they have fallen on average more than 40% year to date, far worse than the corresponding falls of 13% and 21%.
S&P 500
and
Nasdaq Composite Index.
Delivery results can also spread to Tesla trade. Tesla’s Shanghai factory is its most productive. However, Wall Street’s expectations for Tesla’s delivery in the second quarter do not look as aggressive as for the other three. Analysts expect Tesla to deliver about 305,000 vehicles in the second quarter, down from the figure of 310,000 from the first quarter.
Tesla shares also hit up 19% in April, partly due to the market – Nasdaq had fallen 13% – and partly as investors weighed the impact of CEO Elon Musk’s surprising plan to buy
Twitter
(TWTR) at his car company. That may explain why Tesla shares rose 0.4% Monday morning.
There is already a lot of bad news in the stock.
Write to Al Root at allen.root@dowjones.com