Shares of Nio Inc. Rise Amid Tariff Concerns
Shares of Nio Inc. (NIO) rose 1.3% in morning trading on Thursday, shrugging off concerns raised by a report in The Wall Street Journal. The report suggested that the Biden administration is considering raising tariffs on electric vehicles (EVs) made in China. This positive response comes after the stock plummeted 10.2% on Wednesday, ending a five-day winning streak.
Mixed Results for China-Based EV Makers
While Nio Inc. experienced an upswing, other China-based EV makers saw mixed results. XPeng Inc.'s stock (XPEV) gained 0.6%, while Li Auto Inc.'s stock (LI) slipped 0.4%.
Tariff Discussion Raises Questions
According to sources familiar with the matter cited in the WSJ report, the Biden administration, which has maintained Trump-era tariffs on approximately $300 billion worth of goods from China, is now discussing the possibility of increasing tariffs on goods such as EVs, EV battery packs, and solar products.
Existing Challenges for Chinese EVs
It is important to note that EVs from China already face a 25% tariff. Additionally, data from GeoRev reveals that all revenue generated by Nio, XPeng, and Li Auto over the past year has come from China.
Performance Recap
Nio's stock has suffered a 17.7% decline year-to-date. In comparison, XPeng shares have seen a 41.5% climb, while Li Auto's stock has soared an impressive 62%. Meanwhile, the iShares MSCI China ETF has experienced a 15.6% decline, and the S&P 500 has advanced 23.3% this year.
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