China Electric Car Maker Nio is Near Bankruptcy

A young electric car company in China, NIO, appears to be days to weeks from bankruptcy.

Analysts at Sanford C. Bernstein led by Robin Zhu cut their price target for NIO to just $0.90. In a note, Zhu and his team said that even with a recent $200 million raise, the company may have only weeks of cash remaining.

China has been rolling back subsidies provided for new energy vehicles and plans to phase out subsidies after 2020.

NIO sold 3,140 ES8 cars in the quarter, down from 3,989 cars in the first quarter. ES8 is a pure-electric, seven-seat sport-utility vehicle, which is seen as a rival to Tesla’s Model X. They sold 413 cars of the cheaper ES6 model.

NIO also tried to create luxury social clubs and luxury non-car product lines as part of their offering.

The stock is down to about $1.22 a share.

SOURCES – NIO, Motley Fool
Written By Brian Wang, Nextbigfuture.com