While speaking during an interview before NIO’s secondary listing in Singapore, NIO CEO William Li said he was currently more concerned about supply chain stability rather than looking at demand for electric vehicles. The recent upward revision of EV prices by the company shows how much those supply chain issues are affecting company operations.
In addition, the company had to temporarily halt its operations in April when COVID-19 containment measures in China made it impossible for the company to source the needed raw materials from some suppliers. These two examples illustrate how serious supply chain problems are, not only for NIO but the entire nascent electric vehicle industry, including other startups such as Lucid Motors (NASDAQ: LCID).
Li also revealed that he expected the demand for fully electric vehicles to keep growing among consumers. He is confident that consumer demand can retain its upward trajectory even when the current subsidies or enabling policies geared at encouraging EV uptake are halted.
COVID-19 restrictions notwithstanding, NIO managed to deliver some 5,000 EVs to buyers during the month of April. While this was a notable achievement given the prevailing challenges in April, it was still a small number of deliveries when compared to the previous month when the company made 10,000 vehicle deliveries to clients.
The company listed in Singapore by introduction, which differs a great deal from an initial public offering. The option taken by NIO is less demanding in terms of the requisite paperwork that must be filed and no new capital being raised. The company shares surged when trading in Singapore started on Friday, with a share soaring by about 20% before closing 2% higher than the opening price.
While Li didn’t explain why the company selected Singapore as the next listing market after Hong Kong, he did mention that the company was looking to make major exports of EVs to the southeast Asia region. He also revealed that NIO planned to establish a research facility in Singapore with the aim of developing autonomous driving and AI capabilities. No definitive timeline for these activities was provided.
NIO’s main listing and trading venue is the NYSE, and the company debuted on that exchange back in 2018 when its IPO was held. Since then, the company has weathered a rollercoaster ride with its shares at one time plunging and then soaring by more than 1,100% in 2020 alone. Overall, the shares of the company have gained 150% from the IPO price set in 2018.
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