NIO Seen as the Top EV Maker in China for 2022 by Deutsche Bank

NIO could be facing the most important product cycle in history, as detailed by Deutsche Bank’s Edison Yu, according to CNEVPost.

The narrative is shifting from supply constraints to a product supercycle, despite stagnation seen in the last few quarters.

In a statement, the Deutsche Bank team wrote, “Following 4Q earnings last week and an investor meeting with management yesterday, we come away with increased conviction NIO is embarking on the most important product cycle in the company’s history.”

NIO’s ET5 and recently released ET7 are some of the Chinese market’s most-desired vehicles, and the firm thinks they could become category-defining products amidst growing competition.

Deutsche Bank predicts NIO will have sales of 170,000 vehicles throughout 2022, and 320,000 units in 2023 — making this the period of time in which the automaker plans to substantially ramp up production. Yu predicts a Q2 run-rate of 13,000 cars delivered per month, up from NIO’s current 10-11,000 cars since September.

Yu says NIO is Deutsche Bank’s top EV automaker pick in China for 2022, with a $50 per share price target. The company believes NIO’s ramping up of supply chain battery lines from CATL from four to seven will improve its supply chain.

“Looking ahead, we can envision the stock being choppy until late 2Q when ET7 deliveries start picking up, paving the way for the stock to outperform for the rest of the year on a relative basis,” wrote Yu.

In Q4 2021, NIO delivered 25,034 units, marking a 44 percent increase year-over-year.

NIO also saw its first ET7 units roll off the production line last week, set for delivery to local customers.

Ark Invest’s Cathie Wood trimmed shares of Tesla earlier this week, while purchasing 420,000 shares of NIO’s stock.