Here is your weekly Pro Recap of the past week’s biggest headlines in the electric vehicle space: Musk wants to incorporate in TX; Cuts at Polestar; and Chinese EV deliveries.
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Chinese startups report EV delivery numbers
China’s electric vehicle market continued to showcase healthy growth in January.
Xpeng Inc (NYSE:) announced an impressive 58% YoY increase, delivering 8,250 Smart EVs. The highlight of the month was the launch of the X9 Ultra Smart Large Seven-seater MPV, with 2,478 X9s delivered, and the X9 Max trim dominating 70% of total X9 orders. XPeng is ramping up production capacity to meet the increasing demand.
Nio Inc. (NYSE:) achieved a significant milestone, delivering 10,055 vehicles in January, reflecting an 18% YoY increase. However, a 44% MoM decrease aligned with market expectations. The breakdown of deliveries included a remarkable 188% YoY growth in SUVs (ES6/EC6+ES7/EC7+ES8), while sedans (ET5, ET5T, ET7) experienced a 41% YoY decline.
Li Auto Inc (NASDAQ:) made a strong start in January with 31,165 vehicle deliveries, marking a remarkable 106% YoY increase. Although down 38% MoM, market analysts suggest a correlation between delivery figures and a new order intake of 33-35k, aligning with predictions. As Li Auto continues promotions and prepares for the L9/8/7 facelifts in 2Q24, investors are keenly watching for the company’s ability to regain its peak monthly run-rate of 50k units, with new models like MEGA and L6 playing a pivotal role.
Shares of XPEV and LI ended trading Friday down 4% and 0.84% respectively for the week, while NIO ended the week relatively flat.
Tesla’s 2.2M EV Recall and Shift to Texas
Tesla Inc (NASDAQ:) faced a setback as it recalled nearly 2.2 million EVs in the U.S. due to font size issues in warning lights.
The National Highway Traffic Safety Administration (NHTSA) noted that a smaller font size can make critical safety information on the instrument panel difficult to read, increasing the risk of a crash. This marks Tesla’s fifth recall in less than two years.
In a surprising move, Tesla CEO Elon Musk announced his wish to conduct a shareholder vote to decide whether to shift the company’s state of incorporation to Texas. Musk’s informal poll on X (formerly Twitter) revealed over 80% of respondents favored the move.
The statement comes after a Delaware judge invalidated Musk’s $56 billion pay package, prompting the multi-billionaire to express dissatisfaction with incorporating companies in Delaware.
Tesla’s significant investments in Texas, including a gigafactory and a lithium refinery, highlight the company’s view of the state’s business-friendly environment.
Shares of TSLA ended trading on Friday down 1.58% for the week.
Polestar Faces Workforce Reduction
Polestar Automotive Holding (NASDAQ:) announced plans to cut 15% of its global workforce, approximately 150 jobs, citing “challenging market conditions.”
The move is part of a broader strategy to achieve cash flow breakeven by 2025 and reduce dependence on external funding. The decision follows Polestar’s adjustment of delivery projections and a modified business strategy in November.
Volvo (OTC:) Cars announced this week that the company will no longer financially support Polestar and will transfer responsibility to China’s Geely Holding led to a more than 30% increase in Volvo’s stock, while PSNY sank more than 12%.
Critics questioned Volvo’s heavy involvement in Polestar, viewing it as a drain on resources, especially amid challenges like a price war initiated by Tesla.
Polestar’s shares have plummeted by over 83% since going public in June 2022.
Geely welcomed Volvo’s decision and pledged continued operational and financial support for the Polestar brand. Analysts, however, speculate the possibility of Geely selling down its shares in Volvo.
Shares of PSNY ended trading Friday down 14.14% for the week.