What happened
Nio (NYSE: NIO) stock soared this morning and was trading up a solid 9% at 10:20 a.m. ET.
It's been a choppy week so far for the electric vehicle (EV) stock, so this rise in its share price is even more pronounced. Nio's latest expansion plans are reassuring investors about the company's growth potential even as they realize Nio's stock price may not be hit too hard if the company makes a bold move similar to the one a Chinese stock made today.
So what
Aside from its domestic market, China, the only other market Nio has entered so far is Norway, where it first launched its SUV, ES8, in September and opened a Nio House in October last year. Nio Houses are experience centers for its car owners and house multiple facilities and services like a library and café. Just last week, Nio delivered its 500th vehicle in Norway.
Nio is now ready to expand in Norway and plans to open its second Nio House in the European country in the third quarter, according to an announcement made on the Norwegian version of Nio's mobile app, CnEVPost reports. Two new showrooms and battery swap stations each in Norway this year are also in the pipeline.
Image source: Nio.
Nio's battery swap stations are integral to the company's success, as they are the foundation of the EV maker's popular battery-as-a-service (BaaS) program, under which customers can buy Nio cars without batteries at lower prices and instead subscribe to plans to rent and exchange batteries at Nio's swap stations as and when required.
Put another way, it's evident Nio wants to build brand loyalty with additional offerings like Nio Houses and BaaS and doesn't want to limit these experiences to China as it strives to expand globally.
Nio's expansion in Norway is, in fact, just a small part of its European plans for the year. Nio earlier said it plans to enter Germany, Sweden, Denmark, and the Netherlands as well in 2022, so the second half of the year should be a busy one for the company.
With Nio's production and deliveries slowing down in the past couple of months amid COVID-19 lockdowns in China, investors are happy to see the company's growth plans are on track.
Now what
There's another reason Nio stock is on fire today: Chinese ride-hailer Didi Global (NYSE: DIDI) has decided to delist from the New York Stock Exchange, and the stock shot up on this development early this morning.
Now what does Didi's move have to do with Nio, you may ask? The thing is, Nio also faces the threat of delisting from the U.S. under the Holding Foreign Companies Accountable Act (HFCAA), which requires foreign companies to open their audit reports for inspection by U.S. regulators or be banned from trading their stocks in the U.S.
To be sure, there's a lot more to Didi's delisting, as it was also a victim of China's tech crackdown, which has throttled growth. Nio, on the other hand, is just one of the several Chinese stocks at risk of mass delisting.
The difference, though, is that Nio has already been proactive and listed its stock in Hong Kong and Singapore to provide its shareholders in the U.S. with alternative platforms for trading their shares. That's a reassurance for investors in Nio, as they realize they won't be left in the lurch if their shares delist, unlike Didi shareholders.
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Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nio Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
