Morgan Stanley has forecast that Nio will guide for record third-quarter deliveries, even as concerns linger over production of its new Onvo L90 model despite the “strong backlog.”
The bank said investors would focus on the third-quarter volume outlook and how China’s leading electric-vehicle start-ups are adjusting their strategies in the face of “the anti-involution policy backdrop and pro-competition industry nature.”
In a research note published on Saturday, Morgan Stanley added that structural factors such as product pipelines and globalisation could help “mitigate cyclical headwinds” following the end of industry subsidies.
The bank said XPeng and Nio were the start-ups most likely to “surprise slightly on the upside with superior OPEX [operating expenses] control.”
Nio delivered 72,000 to 75,000 vehicles in the second quarter, in line with its guidance and up 72% from the prior quarter and 26% year on year.
Morgan Stanley expects second-quarter revenue of the Shanghai-based EV maker to come in at between 19.5 billion yuan and 20.1 billion yuan ($2.71B-$2.80B), also in line with the company’s forecast.
The bank expects Nio’s net loss to narrow in the third quarter, to about 5.5 billion yuan ($766 million) compared with the 6.9 billion yuan ($961 million) loss reported in the first quarter.
“3Q, we look for Nio to guide for vehicle volume to grow 8-11% QoQ to 78-80k units, given incremental contribution from a solid Onvo L90 order backlog,” Morgan Stanley wrote.
In a post on the social media platform Weibo on Thursday, Onvo‘s chief Shen Fei said production and deliveries were “still in full swing” and the company was “continuously improving the overall battery swap experience.”
Nio, which sells cars under the Nio, Onvo and Firefly brands, delivered 21,017 vehicles in July, the first month of the third quarter.
Based on that, Morgan Stanley estimates the company to guide for between 56,983 and 58,983 vehicles delivered in August and September combined.
At the low end, quarterly deliveries of 78,000 units would average nearly 28,500 in August and September, setting a new monthly record for 2025 but still below Nio’s peak of 31,138 deliveries in December 2024.
The company has yet to announce when it will report second-quarter earnings.
Nio’s US-listed shares fell 8.96% on Tuesday to $4.47, erasing gains from the previous four sessions, after Morgan Stanley linked the decline to L90 production concerns and fears of a potential capital raise.
Shares rebounded later in the week, rising more than 8% on Friday to close at $4.81.
