NIO Inc. (NYSE: NIO) achieved a key production milestone last week, and the feat has elicited appreciation from an unexpected quarter.
What Happened: EV pioneer Tesla, Inc.'s (NASDAQ: TSLA) CEO Elon Musk has acknowledged Nio's landmark production milestone of rolling out its 100,000th vehicle off its production line. In a tweet, Musk congratulated Nio and also went on to say it was indeed a tough milestone.
Musk's words should come as a surprise, as both Tesla and Nio are pitched against each other in the hot Chinese market. Musk had not shied away from taking digs at Nio in the past. In November, when Nio's shares rose past a psychological resistance point of $40, Musk brushed it off, saying, "420 is ten times better than 42," in a reference to his company's shares, which were about 10 times more than Nio's.
Why It's Matters: The global EV market potential is big enough to support multiple players, according to sell-side analysts. Domestically in China, Nio's vehicles are pitched to a different price segment from Tesla. The average selling price of a Nio vehicle is currently 428,00 yuan ($65,410), positioning it well into the premium segment.
Nio's Chairman and CEO William Li suggested that the company commands 50% of the high-end Chinese EV market, defined as EVs priced over 350,000 yuan.
Meanwhile, Tesla is pushing its cost-competitive made-in-China Model 3 sedan and the recently launched made-in-China Model Y vehicle in China.
Nio's shares closed Friday's session down 1.50% to $38.12, and Tesla ended down 0.99% to $677.02.
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