By Philip van Doorn
Corrected to show Tesla delivered 201,304 vehicles during the second quarter.
Chinese electric-vehicle maker Nio Inc., which sells no cars in the U.S., has a market capitalization of $60.2 billion. By that measure, it is larger than Ford Motor Co., which was founded in 1903.
That might make sense to you as an investor — after all, Nio is an innovative company that sells only electric vehicles. Ford is a legacy auto maker that is working to catch up and eventually make a full transition to electric vehicles. Shares of Nio have more than tripled in the past year, while Ford’s have almost doubled after cratering in the previous decade.
So where does Nio /zigman2/quotes/204905836/composite NIO -3.31% , which reported second-quarter results after the stock market closes Wednesday, fit in an investment thesis? Below are screens showing how its stock valuation compares to vehicle production, and how that valuation relates to projected earnings through 2025.
Doubling car production
For the second quarter, Nio delivered 21,896 vehicles for a 112% increase from a year earlier. The growth is impressive, but the total number of vehicles sold is still relatively small.
Here’s a look at the 10 largest auto makers by market capitalization, along with their second-quarter sales or delivery numbers (whichever was higher, if both were reported) and additional color below the table:
|Company||Market capitalization ($ millions)||Total vehicles sold or delivered – second quarter, 2021|
|Tesla Inc. /zigman2/quotes/203558040/composite TSLA||$702,901||201,304|
|Toyota Motor Corp. /zigman2/quotes/200537742/composite TM /zigman2/quotes/203803129/delayed JP:7203||$293,507||2,545,000|
|Volkswagen AG /zigman2/quotes/204431732/delayed VWAGY /zigman2/quotes/206919008/delayed XE:VOW||$102,919||2,546,000|
|Daimler AG /zigman2/quotes/208157843/delayed DMLRY /zigman2/quotes/201850364/delayed XE:DAI||$93,333||736,400|
|General Motors Co. /zigman2/quotes/205226835/composite GM||$78,771||1,757,000|
|Stellantis N.V. /zigman2/quotes/204248628/composite STLA||$66,039||1,655,400|
|Nio Inc. ADR Class A /zigman2/quotes/204905836/composite NIO||$60,215||21,896|
|Honda Motor Co. Ltd /zigman2/quotes/207173990/composite HMC /zigman2/quotes/200490352/delayed JP:7267||$59,415||998,000|
|Bayerische Motoren Werke AG /zigman2/quotes/200850296/delayed BMWYY /zigman2/quotes/202432319/delayed XE:BMW||$57,973||778,504|
|Ford Motor Co. /zigman2/quotes/208911460/composite F||$54,228||764,000|
Click on the tickers for more about each company.
You can see that those valuations are about the future, when innovators in the EV space — Tesla Inc. /zigman2/quotes/203558040/composite TSLA -3.38% and Nio, on this list — may (or may not) become as large as legacy players.
For now, Ford /zigman2/quotes/208911460/composite F -7.92% churns out mostly internal combustion engine (ICE) vehicles at nearly 35 times the rate that Nio makes EVs.
One thing to be aware of is that the legacy auto makers don’t all report their unit sales the same way. Most don’t break out electric vehicle sales.
Among those that do, definitions vary. For example, Toyota Motor Corp. /zigman2/quotes/200537742/composite TM -2.43% /zigman2/quotes/203803129/delayed JP:7203 -4.97% reported that “electrified vehicle” sales made up 26.6% of total auto sales during the second quarter. But that category includes:
HEV – hybrid EVs that are not plug-ins.
PHEV – plug-in electric vehicles.
BEV – battery electric vehicles.