Morgan Stanley lowered the firm’s price target on Nio to $10 from $13 and keeps an Overweight rating on the shares. The firm cut its 2024/2025 total shipment volume forecasts by 11%/9%, to 200k/286k units respectively. It also lowered its 2024 and 2025 vehicle gross margin forecasts by 3ppts, reflecting extra costs associated with the transition of its legacy model as well as organizational restructuring. With all new 2024 facelift models launched, combined with economies of scale, management is confident it can reach its 15%-18% GPM target for the Nio core brand in the long run. Accordingly, Morgan widens its per-share loss estimate for 2024 and now expects Nio to turn profitable in 2026.
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