Nio has less than 12 months of cash, and the clock is ticking.
The short version:
- EV company Nio reports, “substantial doubt about its ability to continue as a going concern,” sending its shares falling once again.
- The company first had financial difficulties when China cut subsidies for electric vehicles.
- COVID-19 made the situation worse by slowing production and deliveries.
- Nio has said it does not have money to maintain 12 months of operations, after suffering a net loss of $1.2 billion for the full year 2019.
So here’s the deal…I hate to see this. We all knew not every EV company was going to survive COVID-19, but it’s always hard to see the first one to go down. It seems China has flattened the curved of the outbreak, so perhaps Nio will be able to increase production and deliveries before its money runs out.