Tesla challenger Nio says talks with Guangzhou Automobile in early stage
Tesla challenger Nio Inc said on Wednesday it was exploring financing and strategic opportunities with Chinese automaker Guangzhou Automobile Group, but the talks were in a preliminary stage.
Earlier in the day, news website Sina Finance reported that Nio was in talks with Guangzhou to finance up to $1 billion, sending U.S.-listed shares of the electric-car maker up about 17% in heavy trading.
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Electric-car makers are battling uncertain demand in China, the world’s largest car market, as it rolls back subsidies on new energy vehicles amid criticism that some firms have become overly reliant on funds.
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Nio on Dec. 30 had warned in its quarterly report that it did not have adequate cash for continuous operation in the next 12 months and it was looking for external financing.
The Nio EP9 self-driving concept electric vehicle (EV) is displayed during the media day of 17th Shanghai International Automobile Industry Exhibition (Photo by Visual China Group via Getty Images/Visual China Group via Getty Images)
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U.S.-listed shares of the electric-car maker were jumped 17% to $4.40 in late afternoon trading.
Nio said the New York Stock Exchange had contacted it after the unusual market activity in its American Depositary Shares.