Why Nio Shares Are Skidding In Premarket Session Today

Shares of Chinese electric vehicle startup Nio Inc. (NYSE: NIO) are declining in premarket trading on Tuesday.

What Happened: The Shanghai-based electric vehicle maker lowered its fourth-quarter deliveries guidance from 43,000-48,000 units to 38,500-39,500 units.

See Also: Best Chinese Stocks

It blamed its action on production and delivery challenges along with supply chain constraints due to the outbreak of the omicron variant of the coronavirus in many major Chinese cities.

“While our teams have strived to maintain continuous operations on all fronts, we were not able to reach our full capacities, particularly when there have been disruptions in delivery and registration procedures involving users,” the company said.

The negative preannouncement comes close on the heels of the company’s annual Nio Day 2022 held on Saturday. At the event, the company announced the EC7 coupe, its seventh vehicle model, and the all-new ES8, an improved version of its flagship SUV. The company also released the 500 kW ultra-fast charging station and the third-generation power swap station.

Price Action: In premarket trading on Tuesday, Nio shares were moving down 3.46% to $10.59 according to Benzinga Pro data. The stock recently bounced off support around $9.7 and amid the negativity, it could retest this level.