Nio Shares Jump on Launch of Budget-Friendly ES8 SUV

Nio (NIO, Financials) surged Thursday after unveiling one of its most affordable electric SUVs, part of its strategy to stay competitive in China's crowded EV market.

The new ES8, announced late Thursday, is priced at 308,800 yuan ($43,000) under a battery subscription plan, allowing users to swap or upgrade batteries via monthly payments. Shares in the U.S. closed 9.27% higher at $5.54, while Hong Kong shares jumped as much as 10% Friday morning.

Analysts say the attractive pricing well below the typical 338,000 to 768,000 yuan range for premium SUVs could drive strong demand. Morningstar's Vincent Sun told CNBC that the rally reflects market expectations of robust orders for both the ES8 and the Onvo L90, launched earlier.

The move signals a pivot for Nio, which traditionally focused on high-end models but has struggled against cheaper competitors. The Tencent-backed firm is expanding its lineup with two new brands: Onvo for the mass market and Firefly for younger buyers.

The ES8 follows a tough July, when Nio and peers like BYD and Li Auto saw deliveries fall to 21,017 vehicles from 24,925 in June. Meanwhile, rivals like Xpeng, Xiaomi, Leapmotor, and Aito reported growth. Amid domestic price wars, export restrictions, and regulatory scrutiny in the European Union, Nio is looking outward.

The company said Monday it will enter three new markets by 2026, including Singapore its first foray into Southeast Asia with its first right-hand drive model under the Firefly brand.