By Kimberly Chin 

Electric-vehicle maker Nio Inc. said its sales more than doubled in the latest quarter as the Chinese company vies for a share of the competitive EV market.

Nio's vehicle sales increased 146% from a year earlier to 4.27 billion yuan, equivalent to $650 million, while overall revenue for the quarter rose to 4.53 billion yuan from 1.84 billion yuan. Analysts polled by FactSet were expecting 4.37 billion yuan in total revenue.

Nio's American depositary receipts, which have soared this year, fell 3% after hours to around $45 on Tuesday.

Shanghai-based Nio, which was founded in November 2014 by serial entrepreneur William Li Bin and backed by Chinese internet giant Tencent Holdings Ltd., focuses on developing and manufacturing electric vehicles. Nio went public on the New York Stock Exchange in September 2018.

The expectation of sharp growth in electric-vehicle sales, and rising valuations for Tesla Inc. and newcomers like Nio, are spurring one of the biggest transformations in the auto industry in a century, driving new investments and opening the door to a host of new competitors and brands globally.

Electric-vehicle sales account for only about 2% of total car sales globally but are expected to grow amid tightening regulations on tailpipe emissions globally. Eco-friendly policies from the European Union and China and from U.S. states like California are prompting auto makers to invest billions of dollars into electric technology and models.

Hurdles to adoption of electric vehicles remain, though, including the need for more charging stations and higher costs relative to cars powered by gasoline or diesel fuel.

China represents fertile ground for electric vehicle makers, with the country aiming for new-energy vehicles to account for around 20% of its total car sales by 2025.

"China remains a greenfield EV market opportunity as we believe overall EV sales can potentially double over the next few years given the pent=up demand for EV vehicles in this region across all price points," said Wedbush Securities Analyst Daniel Ives in a note.

Tesla Inc. posted its fifth consecutive quarter of profitability in the third quarter, propelled by production from its Shanghai factory, where Tesla benefits from cheaper labor, and from strong demand for its more-affordable Model 3 car.

Tesla's shares have more than quintupled this year and closed up 8.2% on Tuesday at $441.61, a day after the S&P Dow Jones Indices said it will add the electric-car maker to the S&P 500.

Nio began deliveries of an electric coupe sports utility vehicle in September, which is set to challenge Tesla's midsize SUV, the Model Y.

Nio said it delivered 12,206 vehicles in the September-ended quarter, a more than 150% increase from the prior year. In October, it delivered 5,055 vehicles, bringing its 2020 tally so far to 31,430 vehicles, more than double the number in the same period last year, company said.

The company projects EV deliveries of around 16,500 to 17,000 in the fourth quarter and revenue between 6.26 billion yuan and 6.44 billion yuan

Losses for the third quarter narrowed to 1.05 billion yuan, or 98 yuan an American depositary share, from 2.52 billion yuan, or 2.48 yuan, in the comparable period a year ago. Excluding share-based compensation and other special items, adjusted losses per ADS were 82 yuan. Analysts were looking for a reported loss of 1.18 yuan a share.

Write to Kimberly Chin at kimberly.chin@wsj.com

 

(END) Dow Jones Newswires

November 17, 2020 18:03 ET (23:03 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.
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