Tesla challenger Nio says talks with Guangzhou Automobile in early stage

Global Equities Research director Trip Chowdhry discusses Tesla stock and says it’ll hit $4,000 in 2030.

Tesla challenger Nio Inc said on Wednesday it had been exploring financing and strategic opportunities with Chinese automaker Guangzhou Automobile Group, but the talks were during a preliminary stage.

Earlier within 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, because it rolls back subsidies on new energy vehicles amid criticism that some firms became overly reliant on funds.

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Nio on Dec. 30 had warned in its quarterly report that it didn’t have adequate cash for continuous operation within the next 12 months and it had been trying to find external financing.

The Nio EP9 self-driving concept electric vehicle (EV) is displayed during the media day of 17th Shanghai International 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 ny stock market had contacted it after the weird market activity in its American Depositary Shares.

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