Nio's Onvo L90 Launch Sparks Interest in EV Stock

Nio launched a new SUV, Onvo L90, with Morgan Stanley calling it a "major catalyst" and reaffirming its "Buy" rating with a $5.90 price target. The firm believes the L90 offers aggressive specs at a competitive price, giving it an edge over rivals. Strong pre-order momentum in Hong Kong and the backing of Nio's expanding battery-swap and tech infrastructure make it a game-changer if Onvo can overcome branding and execution hurdles. The low price may help turn investor doubt into fresh demand.

Nio (NIO), a leading designer and manufacturer of smart electric vehicles (EVs), recently launched its new SUV, the Onvo L90, marking a significant milestone for the company. Morgan Stanley reaffirmed its "Buy" rating on NIO, with a price target of $5.90, calling the L90 launch a "major catalyst." The analyst firm sees the L90 as offering aggressive specifications at a competitive price, which could give it an edge over rivals.

The Onvo L90 was unveiled in July 2025 at a starting price of RMB 279,900, including an 85 kWh battery, or RMB 193,900 under its Battery-as-a-Service plan. This aggressive pricing undercuts competitors such as the Li Auto L9 (RMB 409,800) and entry models like the Li L6 and XPeng (XPEV) G9. Despite its value positioning, the L90 boasts premium features: 900V fast charging, an AR head-up display, adjustable air suspension, an integrated smart fridge, and Level 2+ autonomous aids powered by Nvidia’s (NVDA) Orin-X chip. Its spacious cabin rivals those of higher-priced six-seaters like the AITO M9 and BYD (BYDDY) Denza N9.

Strong pre-order momentum in Hong Kong, with preorders hitting 30,000–35,000 within days, has further boosted investor confidence. NIO is dispatching early units to dealers for market feedback, with a five-seat L80 and 400 new sales outlets slated for late 2025.

NIO’s financial performance in the first half of 2025 has been robust, with record deliveries and a 21% year-over-year increase in revenue. However, the company continues to face challenges, with persistent losses and a need to improve margins. The Onvo L90 and its upcoming L80 model are key to NIO’s turnaround strategy, aiming for 20% gross margin for the core NIO brand and 15% for Onvo by late 2025.

Wall Street analysts are divided on NIO stock, with a broader consensus rating at "Hold." While Morgan Stanley sees the L90 as a game-changer, other analysts caution about Onvo’s execution and branding hurdles. NIO shares are currently trading above the average price target of $4.37, but the 16 analysts in coverage have a wide range of targets, from $3 to $8.10.

References:
[1] https://www.barchart.com/story/news/33539719/nio-just-launched-a-new-suv-and-wall-streets-paying-attention-should-you-buy-the-ev-stock-here