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Auto Stock Roundup: TSLA's China-Made Model 3 Deliveries, NIO Q3 Results & More

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The highlight of the past week was the start of deliveries of Model 3 vehicles, built at the Gigafactory3 in Shanghai, by Tesla (TSLA - Free Report) . The first 15 customers, who are slated to get their Model 3 cars, are employees of Tesla. Mass deliveries of China-made Model 3 are expected to begin from Jan 7.

Tesla’s Chinese rival NIO Inc. (NIO - Free Report) reported narrower-than-expected loss in third-quarter 2019 on the back of rising deliveries of the ES6 model. Nissan Motor (NSANY - Free Report) also made headlines as itsvice chief operating officer, Jun Seki abruptly resigned from the company. Seki’s decision to resign is seen as yet another potential blow to Nissan’s turnaround plan.

(Read the Last Auto Stock Roundup here).

Recap of the Week’s Most Important Stories

1. Reportedly, Tesla will commence mass deliveries of Model 3 vehicles built at its Gigafactory3 in Shanghai from Jan 7, 2020.Notably, Gigafactory3 is China’s first completely foreign-owned car plant. Tesla started construction of the plant in January and began production in October. The Gigafactory3 in Shanghai has been built as part of Tesla’s plan to boost presence in the world’s largest auto market, China, and reduce the impact of the U.S.-China trade war. The Ministry of Industry and Information Technology recently stated that it added China-made Model 3 of Tesla to a list of new energy vehicles that are excluded from purchase tax. Tesla currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

2. NIO reported adjusted loss per share of 33 cents in third-quarter 2019, narrower than the Zacks Consensus Estimate of a loss of 41 cents and the prior-year quarter’s loss of $1.51. High demand for the company’s ES6 model led to the improved results. Notably, total deliveries in the quarter under review were 4,799 units, suggesting an uptick from 3,268 units in the year-ago period. Total revenues grew 25% year over year to $257 million. The figure also outpaced the Zacks Consensus Estimate of $249 million. NIO anticipates vehicle deliveries to be more than 8,000 units for fourth-quarter 2019, suggesting a rise of more than 66.7% from the prior-year period. (Read more: NIO Beats on Q3 Earnings, Expects Record Deliveries in Q4)

3. Nissan Motor’s third-highest ranked executive and vice chief operating officer, Jun Seki, abruptly resigned from the company just weeks after taking up the job. Resultantly, the company’s shares fell to an eight-year low, declining 3.1% to 633 yen as of Dec 25, 2019, in the Tokyo Stock Exchange. The company is also struggling to recover from the ousting of former chairman Carlos Ghosn, industry downturn, decade-low profits and strained ties with French partner Renault SA. Following the surprise resignation of Seki, Nissan has chosen executive vice president Hideyuki Sakamoto as a board candidate. (Read more: Nissan Hits 8-year Low as Top Executive Resigns)

4. Volkswagen AG (VWAGY - Free Report) announced that it will reach the target of 1 million electric cars by the end of 2023, which is two years earlier than anticipated. As a result, the company significantly raised the electric car production target for 2025. It now anticipates producing 1.5 million electric cars by 2025.In November, the company started production of the ID.3 model at the Zwickau plant. It expects to produce up to 330,000 EVs from 2021, making Zwickau the largest and most efficient EV factory in Europe. Volkswagen anticipates that the first ID.3 electric cars will appear on Europe's roads in the summer of 2020. The company plans to invest €33 billion in e-mobility throughout the group by 2024, which includes €11 billion in the Volkswagen brand. (Read more: Volkswagen Increases Production Target for Electric Cars)

5. Advance Auto Parts, Inc. (AAP - Free Report) recently announced that it has purchased the DieHard car battery brand from Transform Holdco LLC, the parent company of Kmart and Sears, for a cash consideration of $200 million.Following the acquisition, Advance Auto Parts will have the right to sell DieHard batteries, and extend the DieHard brand to other automotive and vehicle categories. Moreover, the acquisition of DieHard is expected to differentiate Advance Auto Parts, drive increased DIY customer traffic, create a unique value proposition for expert customers and independent Carquest partners, as well as drive significant long-term shareholder value. (Read more: Advance Auto Parts Purchases DieHard Brand for $200M)

Price Performance

 

Company

Last Week

Last 6 Months

GM

2.4%

-2.1%

F

-0.3%

-7.7%

TSLA

-0.2%

83.1%

TM

0.5%

12.1%

HMC

-0.4%

9.9%

HOG

-2%

2.3%

AAP

0.1%

-0.8%

AZO

-1.8%

       5.2%

 

The following table shows the price movement of some of the major auto players over the past week and six-month period.

In the past week, Harley Davidson (HOG - Free Report) has declined the most, while General Motors has been the maximum gainer. Over the past six months, Tesla has been the best performer, having rallied 83.1%, while Ford (F - Free Report) has been the worst performing stock.

What’s Next in the Auto Space?

Domestic and foreign auto giants including General Motors, Ford, Fiat Chrysler and Toyota Motors, among others, are set to soon report full-year 2019 U.S. car sales.

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