Chinese electric car maker, NIO, passes US-based General Motors in market cap after crossing the $50 billion mark
NIO could not have wished for a better November as the company hit three major milestones in about 48 hours. The company was initially reported to have surpassed the market cap of popular German car manufacturer, BMW, on November 2. However, the Chinese electric car maker had more surprises as it crossed the $50 billion mark the next day and ultimately surpassed the market cap of General Motors.
The global electric car market has continued to grow over the years, with China being the hub of every event going in the market. Several car manufacturers have emerged in recent times to provide consumers with innovative solutions, and NIO looks ready to give other players in the industry a run for their money. The company’s impressive run on the capital market says a lot about what electric car investors can expect, as NIO has already been described by analysts and experts as the new Tesla.
NIO’s amazing run is not just coming out of the blues as the company seems to have done a lot of work in the background, which is now yielding amazing results. One feature that NIO is currently benefitting from is the hype around the electric vehicle (EV) industry across the globe. Companies like Nikola have enjoyed splashy debuts on the stock market, generating a buying frenzy among electric vehicles investors. While one could easily put NIO, Nikola, and Lordstown Motors into the same class, it is worth noting that the Chinese auto manufacturer offers some differences.
NIO initially went public in late 2018, before the current bandwagon effect of electric car IPOs. Unlike startups like Nikola and Lordstown, the company is already into the production of electric vehicles. NIO started with producing a sports car in 2016 like its senior counterpart in the industry, Tesla, before transitioning into specializing in electric SUVs. The company’s range include 2017's full-size ES8, 2019's midsize ES6, and 2020's EC6 "coupe SUV," essentially a crossover SUV.
NIO was reported to have produced and delivered over 5,000 vehicles in one month, an unprecedented feat in the history of the company, more than doubling its October 2019 output. However, the figures are not anywhere near the likes of GM, which sold over 600,000 vehicles per month in 2019. The relatively small-scale Tesla was also reported to have delivered over than 48,000 vehicles per month in the third quarter of 2020.
While NIO has recorded tremendous growth in recent times, the company has a long way to go in justifying its current valuation.
For more information about NIO’s market performance and updates in the global EV market, please visit - https://cedargrove-investments.com/.
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