Nio reports bigger-than-expected loss in the first-quarter

Nio Inc posted a wider-than-expected loss in the current quarter. The loss underlined a slowing pace of deliveries for its electric vehicles (EV).

The loss sent Nio’s U.S.-listed shares down 7% in extended trading.

Nio, which makes the ES8 and ES6 electric sport-utility vehicles, said it expects to deliver 20,000 to 20,500 vehicles in the first quarter – up 15% to 18% from the fourth quarter.

The forecast, however, is slower than the 42% growth it reported between the third and the fourth quarter, in line with seasonal slowing in auto sales in China overall.

Last April, Nio received a $1 billion funding injection from the Chinese government, which has also helped the company tame recalls and stem falling sales.

It still lags Tesla Inc, which dominates the EV market in China, and also faces competition from homegrown rivals such as Xpeng Inc.

The company delivered 7,225 vehicles in January and 5,578 units last month, as China’s factory activity expanded at the slowest pace in nine months on weak overseas demand and coronavirus flare-ups.

Nio shares soared over 10-fold last year, with its market capitalization overtaking that of Detroit automakers Ford and General Motors, as China led the global automobile industry’s recovery from the pandemic. But as of Monday’s close, its stock is up only 2% this year.

It reported a fourth-quarter net loss of 1.49 billion yuan ($230 million), compared with the average estimate from analysts for a 757 million yuan loss, according to Refinitiv data.