Chinese electric vehicle stocks NIO Inc (NYSE:NIO), XPeng Inc (NYSE:XPEV), and Li Auto Inc (NASDAQ:LI) rose Monday after reports that China’s trade-in program for old cars could boost demand for electric vehicles.
According to Bloomberg, the program could lead to more than 10 million electric car sales by 2024.
In July, China announced plans to introduce incentives that would allow consumers to pay 20,000 yuan ($2,760) to trade in an old car with higher emissions for an electric vehicle, or 15,000 yuan for a more fuel-efficient gasoline car.
Many cities followed suit, introducing additional rebates of $140-$1,400 per vehicle.
According to Bloomberg, BNEF analyst Siyi Mi expects the Chinese government’s higher subsidies to lead to an increase of 2 million car sales, including 1.1 million sales of electric cars with sales of $26 billion.
Nio delivered 20,498 vehicles in July, a level equal to last year, after EV companies started offering attractive discounts to increase market share. Li Auto delivered 51,000 vehicles in July, up 49.4% year-on-year. XPeng delivered 11,145 vehicles, up 1% year-on-year. Reports also pointed to China’s plans to ban Chinese software in autonomous and connected vehicles, which put a damper on the companies.
Shares of Nio have fallen 64%, XPeng 58% and Li Auto more than 48% over the past 12 months amid a domestic price war and protectionist tariffs from the US and EU.
NIO Stock Prediction for 2024
Equity research can be a valuable source of information to learn more about the fundamentals of a company. Analysts create financial models based on the fundamentals and expected future earnings of a company to arrive at a price target and recommendation for the stock.
The average 1-year price target for NIO shares is $6.80, which represents an expected upside of 67.9%.
Due to differences in assumptions, analysts can arrive at very different price targets and recommendations. No analyst has a bearish recommendation for NIO, while 1 analyst has a bullish rating. Citigroup’s street high price target is $8.5, while B of A Securities’ street low is $5.9.
Price promotions: NIO shares were trading down 2.55% to $4.05 at last check on Monday. XPEV was up 1.80 to $7.07 and LI was up 3.19% to $21.19.
Photos via Shutterstock
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This article What’s Happening to Chinese EV Stocks Nio, XPeng, and Li Auto on Monday? originally appeared on Benzinga.com
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