Nio Shares Surge After Onvo L90 SUV Launch and Morgan Stanley Endorsement

Shares of Nio Inc. (HK:9866) jumped 7.3% to HK$29.60 on Friday in Hong Kong, outperforming the Hang Seng Index's 1.9% gain, after the electric vehicle maker launched its new Onvo L90 SUV. The vehicle received a positive market response, prompting Morgan Stanley to reaffirm its Overweight rating.

Pre-sales for the Onvo L90 began Thursday, with pricing starting at 279,900 yuan (approx. $39,000) for the 85-kWh model. A more affordable version is also offered under the battery-as-a-service model at 193,900 yuan. Despite its competitive price point, the SUV includes premium features such as 900V fast charging, AR-HUD, air suspension, and Nvidia Orin-X-based smart driving capabilities—features typically found in higher-end models.

Morgan Stanley analysts view the L90 as a strong competitor in China’s crowded EV market, especially against similar 6-seater SUVs from Li Auto (NASDAQ:LI), Xpeng (NYSE:XPEV), and Xiaomi (OTC:XIACF). However, they cautioned that Nio’s sub-brand may still face hurdles due to weaker brand recognition and execution history.

The launch comes amid intensifying competition in China's EV sector, with major players locked in a prolonged price war. Xiaomi recently launched its second EV, the YU7, to strong market reception, while BYD (SZ:002594) has been slashing prices on select models, raising concerns over industry-wide profit margins.

Despite the pricing pressure, Nio delivered nearly 25,000 EVs in June, marking a 17.5% year-over-year increase, signaling resilience amid fierce competition. As Nio expands its product lineup with the Onvo L90, market watchers will be closely monitoring its sales performance and ability to gain ground in China’s fast-evolving EV market.