The electric vehicle stock flop continued again today. Similar to yesterday, Fisker (FSR) topped the most actively traded stock on a volume of 210,697,413 shares and will do so again today.
Running out of cash flow, Fisker halted production for six weeks. It needs to secure $150 million in committed financing. The firm said it could further curtail operations if capital is not available when needed. Fisker’s go-public through an SPAC deal in 2020 is proving a mistake. Conversely, Rivian (RIVN) raised funds through a traditional IPO route. This added billions in cash to its balance sheet.
China’s NIO Inc. (NIO) continued its decline, closing at $5.19. Despite announcing an aim to achieve longer-life EV batteries through a technology partnership with CATL (Contemporary Amperex Technology Co.), investors are selling NIO stock.
NIO’s domestic competitor XPeng (XPEV), posted Q4 results. It posted total deliveries up by 171% Y/Y to 60,158 vehicles. However, gross margin fell to 6.2%,
compared to 8.7% last year. XPeng promises to embark on a new product cycle. It will launch over 10 new models in the next three years.
The increase in XPeng models is not a viable solution for XPeng. Domestic demand remains weak while competition rises. Margins will likely shrink despite achieving unit sales growth.
Watch Tesla’s (TSLA) rebound potential. The stock must bounce from $160 - $180. $195 is its next resistance level on the 50-day simple moving average.
