NIO, Inc. (NYSE:NIO) stock is moving higher after President Donald Trump indicated that the final tariff rate with China would be “substantially” below the current 145% but not 0%.
The Details: According to the Wall Street Journal, a senior White House official said that the Trump administration is contemplating lowering the rate to between 65% and 50%. The administration may also adopt a tiered approach, with tariff rates varying based on what is deemed strategic to America's interests.
Trump said he was optimistic about trade talks and plans to be "very nice" in order to reach a deal. The move is part of the administration’s attempt to ease tensions in the US–China trade relationship.
China has signaled it is open to trade talks with the US, but not under threats from the administration.
No final decision has been made regarding the tariff rate with China.
NIO and several other US-listed Chinese stocks may be moving higher as lower tariffs on raw materials and components could ease production costs. NIO has also expressed strong interest in entering the U.S. market, where high tariffs would present a barrier to competitive pricing.
The automobile industry and NIO may also be getting a boost after Tesla reported first-quarter earnings Tuesday after the market closed. During the earnings call, CEO Elon Musk told investors he is reducing his time commitment to the “Department of Government Efficiency”.
Investors may see Musk's reduced government focus as a signal that he plans to dedicate more time to Tesla's core operations, which could boost confidence in the broader EV sector, including companies like NIO.
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NIO Price Action: At the time of publication, NIO stock is trading 5.20% higher at $3.94, according to data from Benzinga Pro.
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