Chinese NEV stocks sink tracking Fisker bankruptcy report, Tesla downgrade
Updates to correct reference to Rivian (NASDAQ:RIVN) bankruptcy report to Fisker Inc (NYSE:FSR).
Investing.com-- Chinese new energy vehicle stocks sank on Thursday, tracking overnight declines in their U.S. peers, particularly Tesla Inc, following a report that U.S. electric vehicle maker Fisker was facing bankruptcy.
Shares of Xpeng (NYSE:XPEV) Inc (HK:9868) and NIO Inc (HK:9866) slid more than 4% each in Hong Kong trade, underperforming a 0.2% decline in the broader Hang Seng index. Battery stocks Contemporary Amperex Technology (SZ:300750) and Tianqi Lithium Corp (HK:9696) fell about 0.3% each.
Losses in NEV stocks came after a report showed that U.S. EV maker Fisker Inc (NYSE:FSR) had hired advisers for a potential bankruptcy filing, as the firm grappled with production delays, as well as slowing sales following a negative reception for its Ocean SUV.
Fisker slid nearly 50% in aftermarket trade following the report.
Also denting sentiment towards EV stocks were overnight losses in Tesla Inc (NASDAQ:TSLA), after the world’s most valuable EV maker was downgraded to an underweight (equivalent to sell) rating by Wells Fargo.
Tesla sank 4.5%, with Wells Fargo also slashing its price target on the stock to indicate a 30% downside risk from current levels. The brokerage said that it saw increased risks to sales volumes, and that the carmaker’s aggressive price cuts were having a diminishing impact on its sales.
Tesla’s downgrade highlighted the mounting headwinds for EV makers, particularly from declining sales as consumer interest in the sector dwindled. The premium price tags associated with EVs was a key factor in this trend, especially as high interest rates dented consumer spending over the past two years.
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