These are tough times for EV makers globally. Heated competition, cut-throat pricing, tit-for-tat tariffs between major economies, and weak consumer sentiment are weighing heavily on the sector. And yet, Chinese EV maker NIO (NYSE:NIO) (HK:9866) is shining bright, with a share price gain of nearly 42% over the past month. The stock is up again in the premarket session today after NIO entered into a new battery charging partnership, this time with FAW Group.
NIO’s Strides in Battery Infra
FAW Group is China’s state-owned automotive producer. NIO is teaming up with FAW for battery charging and swapping. The two companies also plan to work on developing new battery technical standards.
Importantly, this is another step in NIO’s rapid strides in setting up battery charging and swapping infrastructure. The collaboration with FAW is NIO’s seventh battery-swapping partnership. So far, it has also announced partnerships with top names, including Geely Automobile and Guangzhou Automobile Group (GAC). Earlier this year, NIO teamed up with battery maker CATL to produce EV batteries that can last up to 15 years.
NIO’s massive battery-swap infrastructure currently has over 2,400 battery-swap outlets. According to Reuters, it plans to add another 1,000 outlets this year. Importantly, its CEO William Li expects the company’s battery-swapping solutions to generate nearly $10 billion annually with a future uptick in the user base. Additionally, a new SUV priced cheaper than Tesla’s (NASDAQ:TSLA) Model Y is keeping investor sentiment buoyant in NIO stock.
Is NIO a Buy, Sell, or a Hold?
Despite the recent euphoria, NIO shares are still down by over 85% over the last three years. Overall, the Street has a Moderate Buy consensus rating on the stock, alongside an average NIO price target of $6.63.
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