NIO, formerly known as NextEV and backed by Chinese tech heavyweight Tencent Holdings Ltd., is one of several largely Chinese-funded EV startups. Photo credit: Reuters
NEW YORK — Shares of Chinese electric carmaker NIO Inc. fell as much as 15 percent in their market debut, a day after its public offering was priced at the lower end of an expected range, weighed down by investor worries about the prospects of chief rival Tesla Inc.
NIO’s shares opened at $6 and dropped to a low of $5.35, giving the company a market capitalization of $5.52 billion.
The company, whose ES8 pure-electric, seven-seat crossover is seen as a rival to Tesla’s Model X, priced 160 million shares at $6.26 on Tuesday, just above the low end of its $6.25 to $8.25 target price range, raising $1 billion.
Tesla’s struggles to meet its production targets and an abandoned attempt by CEO Elon Musk to take it private have weighed not just on its own stock, but also on peers looking to develop mass-market electric cars.
NIO, formerly known as NextEV and backed by Chinese tech heavyweight Tencent Holdings Ltd., is one of several largely Chinese-funded EV startups betting on the benefits of local production to compete with firms such as Tesla.
The listing — the third-biggest in the United States by a Chinese firm this year — comes as Chinese EV makers seek fresh capital to develop new products and finance investments in areas including autonomous driving and battery technologies.
Having begun promoting EVs in 2009, China aims to become a dominant global producer as it bids to curb vehicle emissions, boost energy security and promote high-tech industries.