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China EV Sales As Zero-Covid Curbs Rattle Sector


China EV sales for October are due from Nio (NIO), Li Auto (LI) and Xpeng (XPEV), likely on Tuesday, as the country’s harsh zero-Covid curbs lash manufacturing chains again.

Chinese EV giant BYD (BYDDF) will also report October sales in coming days.


Nio stock was roughly unchanged Monday — and still near multiyear lows — despite reports that deliveries of its new ET5 are being delayed amid Covid-19 lockdowns. Nio and its startup peers launched several new electric vehicles in recent months after sales of older models slowed.

The Covid-19 curbs come even as China braces for an economic slowdown. Tesla (TSLA) and Ford (TSLA) slashed prices of the Model 3, Model Y and Mach-E in late October amid signs of softening demand in the world’s largest market for electric cars. A Stellantis (STLA) joint venture behind the Jeep brand will file for bankruptcy as China sales continue to falter, the Wall Street Journal said Monday.

China EV subsidies end on Dec. 31. That should provide a boost to sales as the year winds down, followed by weaker demand in January.

China EV Sales: Nio

Nio’s report for October will follow a successful third quarter, which saw the once-hot startup return to its former winning ways.

In Q3, Nio outsold XPeng and Li Auto with a record 31,607 deliveries, as production improved and new models launched. It had lagged Xpeng and Li earlier this year.

With three new EV models, Nio has said it expects record deliveries in every month of the current fourth quarter.

But Nio customers are seeing deliveries of the new ET5 sedan delayed due to Covid-19, local media reports said Monday.

Fresh Covid-19 curbs are being widely felt in China, beyond the auto sector, with Apple (AAPL) to Disney (DIS) also said to be affected.

On Monday, Nio said it will report Q3 financials on Nov. 10 before the U.S. market opens. Nio stock eased 0.2% to 9.67 on the stock market today. NIO is far below the 50- and 200-day moving averages.

Xpeng Sales

October sales will mark the first full month of sales of Xpeng’s new G9 SUV. In Q3, XPeng Motors sold 29,570 EVs, including 184 G9s in roughly 10 days of sale.

Xpeng stock on Monday shed 3.8% to 6.63, right at record lows.

Li Auto Sales

The startup’s October sales will mark the first month without its original model, the Li One, which has been discontinued. In Q3, Li Auto sold 26,524 hybrid EVs, dominated by the new L9 SUV.

Li Auto stock Monday shed 4.5% to 13.62 after hitting two-year lows last week.

BYD Sales

The Chinese EV and battery giant is preparing to launch a new, cheaper version of its flagship Han electric sedan. It’s also ramping up new EVs like the Seal, which launched in late August. In Q3, BYD sold 538,704 electric and hybrid vehicles, nearly tripling EV sales vs. a year earlier.

On Oct. 28, BYD reported that third-quarter net income jumped 350% vs. a year earlier in local currency terms, with revenue up 116%. Adjusted earnings spiked 923%. Those were in line with preliminary earnings figures released earlier in the month.

BYDDF stock gained 3.4% to 22.64 Monday after matching a 52-week low intraday Friday.

BYD and Nio launched several new EVs in Europe in October, part of a major international expansion for the former. Exports are a small but rapidly growing share of BYD’s sales.

China EV Sales

Industrywide auto and EV sales data for October will likely be released next week. That will include estimates for Tesla’s China sales. Tesla stock edged down 0.4% to 227.54 on Monday. TSLA is off 16-month lows but below key levels.

China’s electric-car market stayed red-hot in the first nine months of 2022. China EV sales soared 83% in September, while overall car sales grew just 3%, a two-decade low, China Passenger Car Association data showed.

However, a possible economic slowdown could threaten growth. And fresh Covid-19 cases are breaking out while China vows to continue its ultrastrict “zero Covid” containment policy.


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