Nio (NYSE:NIO) stock is down 1.2% this morning after the Chinese electric vehicle (EV) maker launched the first vehicle in its new, low-cost Onvo brand on Wednesday. Indeed, Nio unveiled the Onvo L60 SUV, intended to rival Tesla’s (NASDAQ:TSLA) best-selling Model Y SUV and Toyota’s (NASDAQ:TM) RAV4.
The Onvo L60 will start at $30,476 (219,900 yuan), about 12% less than the Model Y. It is also more spacious and uses 10% fewer materials than Tesla’s offering. Nio will begin delivering the L60 in September.
“RAV4 and Model Y were the benchmark for family cars in their time. With technologies evolving and people’s understanding in smart EVs deepening, today it’s time for us to redefine the new standards for family cars,” Nio Chief Executive William Li said.
The L60 will launch with Nio’s proprietary 900-volt fast-charging engine system. Its average energy consumption is 12.1 kilowatt-hours (KWH) per 100 kilometers, slightly more efficient than the Model Y.
If you recall, the Onvo brand is designed to offer a lower-cost alternative to the namesake brand while also helping Nio expand into the European EV market.
Reasonably so, Nio’s namesake lineup is notably more expensive than Tesla’s in China. Its cheapest model is about 30% more costly than the Model 3 in the country.
NIO Stock Sluggish on New Brand Launch
Despite the promising reveal, NIO stock just can’t shake the bears. NIO is down 37% year-to-date, as a major loser of this year’s EV slump.
Not everyone is down on NIO, however. Indeed, investment banking giant JPMorgan recently raised its rating from NIO stock to “neutral” from “underweight.” According to JPM Analyst Nick Lai, Nio stands to benefit from changes in China’s EV policy promoting the use of EVs.
Still, Nio faces some fairly hefty headwinds, including an anti-subsidy probe launched by the European Union and 100% tariffs in the U.S.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
