Chinese EV makers recover from steep drop

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By Anniek Bao


Shares of Chinese electric vehicle makers rallied after sharp declines earlier this week, buoyed by expectations that Covid-19 restrictions would be eased and help vehicle production and deliveries resume.

Shares of major electric vehicle makers, including Xpeng Inc., Nio Inc. and Great Wall Motors, fell more than 10% on Monday after some of them announced production delays and a drop in sales due to the brakes on the pandemic in China.

Shares of XPeng are up 6.4% on Thursday at 109.9 Hong Kong dollars (US$14), wiping out most of this week’s losses, while shares of Nio are up 4.7% at HK$161.4, returning to where they were before Monday’s decline. The companies’ New York-listed shares closed Wednesday up 7.3% and 4.9%, respectively.

Some analysts say the long-term outlook for electric vehicle production remains healthy despite near-term pressures.

In Shanghai, where many automaker factories are located, restrictions may soon be eased in areas with no new cases for two weeks, said Jeffrey Halley, senior market analyst at Oanda.

Nio said earlier this month it was halting production due to auto parts shortages with suppliers.

Portfolio manager at Fidelity International, Casey McLean, expects China’s new energy vehicles to account for 80% of the country’s auto sales by 2030.

Along with electric vehicle makers, shares of lithium battery providers are also gaining ground after sharp declines on Monday.

Although there are short-term concerns about a tighter supply of lithium, these constraints are expected to ease in the coming months and Fidelity’s McLean expects global supplies “to gradually improve. “in the second half.

Ganfeng Lithium, one of the world’s largest lithium companies, said last week that it plans to expand its lithium spodumene concentrate production capacity to 600,000 metric tons per year from 450,000 tons, by April. It aims to produce 900,000 tons by the end of 2022.

Ganfeng shares, which fell 15% on Monday, are up 1.8% at HK$99.95 but still down 8.4% for the week.


Write to Anniek Bao at anniek.bao@wsj.com

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