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Production and demand for electric vehicles in China rebounded in June.
Qilai Shen/Bloomberg
Investors in electric-vehicle stocks should breathe a sigh of relief on Friday.
Production and demand for electric vehicles in China rebounded in June after a Covid-19-induced lull. Deliveries in June at
NIO
(ticker:
NIO
),
Li Auto
(LI), and
XPeng
(XPEV) looked strong. That had the American depositary receipts of the Chinese electric-vehicle makers rising initially to start the third quarter, although they closed in the red.
Tesla
(TSLA) stock rose Friday, however.
NIO delivered 12,961 vehicles in June, up from 7,024 deliveries in May. June’s number marks a monthly record for the company. What’s more, June results topped guidance given when NIO reported first-quarter numbers in early June.
For the second quarter, NIO delivered 25,059 units, down from 25,768 cars delivered in the first quarter. Second-quarter production and deliveries were dented by China’s zero-Covid policy, which resulted in parts shortages and reduced production for the entire industry.
Li Auto
delivered 13,024 vehicles in June, up from 11,496 deliveries in May. It isn’t a record, but it’s the third best month in the company’s history. Monthly deliveries topped June’s result in November and December of 2021.
For the second quarter, Li delivered 28,687 units, down from 31,716 delivered in the first quarter. The final second-quarter tally also topped its own guidance.
XPeng
results looked best of all. The company reported 15,295 deliveries, up from 10,125 deliveries in May. Like Li, it’s just short of a record, but it’s better than expected, based on the company’s recent guidance. For the second quarter, XPeng delivered 34,422, almost flat with the 34,561 cars delivered in the first quarter.
Combined, the three companies delivered 41,280 vehicles in June. That’s the best month ever. What’s more, Li Auto announced that its new model, the Li 9, is now on sale. That’s another positive for investors to consider.
Li stock rose 2.1% in premarket trading, but shares closed down 1.6%. That’s the same patter for NIO. Its shares finished 1.8% lower. XPeng stock opened higher too, but slid 5.4%.
One reason for the reaction might be how the shares did in Q2. The average auto stock lost investors about 25%. But the three Chinese EV players all rose after a weak first quarter. NIO, Li and XPeng shares fell about 33% on average in the first quarter. The trio rose about 23% on average in the second quarter.
Tesla
(TSLA) stock seemed to get a small boost from Thursday’s delivery news. China is an important market for the company, and Tesla’s most productive plant is in Shanghai. Shares closed up 1.2% Friday. The
S&P 500
and
Nasdaq Composite
rose 1.1% and 0.9%, respectively.
Tesla should report its second-quarter delivery results soon. Wall Street expects roughly 250,000 units, down from 310,000 vehicles delivered in the first quarter.
Anything better than that should be enough to provide some relief for investors. They could use it. In the first half of 2022, Tesla stock dropped about 37%. NIO and Xpeng shares fell 31% and 37%, respectively. Li stock bucked the trend and managed gains, rising 19%.
Write to Al Root at allen.root@dowjones.com
