American depositary receipts of NIO Inc. (NIO slumped 19.6% to $8.17 on Wednesday after the so-called Tesla of China posted a wider-than-expected loss in the fourth quarter and said it experienced "a greater-than-anticipated slowdown in monthly deliveries" of its ES8 sport-utility vehicle.
The Shanghai-based electric carmaker posted a fourth-quarter loss of 3.5 billion renminbi ($520 million), or 49 cents per ADR. Analysts had expected a loss of 32 cents per ADR. Revenue in the quarter of 3.4 billion renminbi topped analysts' forecasts.
NIO said it delivered 7,980 ES8 sport-utility vehicles in the fourth quarter in China vs. 3,268 vehicles delivered in the third quarter. The company said, however, that deliveries of the ES8 in January and February were 1,805 and 811 vehicles, respectively, "which reflect a greater-than-anticipated slowdown in monthly deliveries compared to December 2018.
"The sequential slowdown in vehicle deliveries in January and February was mainly caused by accelerated deliveries made at the end of last year in anticipation of EV subsidy reductions in China in 2019, the seasonal slowdowns surrounding the January 1st and Chinese New Year holidays, as well as the current slowdown of macro-economic conditions in China, particularly in the automotive sector," NIO said in a press release.
The company also said it won't be building a factory in Shanghai. It had signed agreements with the government in 2017 for the project.
"This new initiative allows NIO to focus on the joint manufacturing model in the long term," NIO said. "The company believes that the existing NIO/JAC plant in Hefei will give it capacity and flexibility to support its market penetration and growth plans for the next two to three years."
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