NIO Inc. ( NIO ) shares are diving in the premarket session on Wednesday after the company slashes its first-quarter delivery outlook.

Based on the most recent business update, the company expects to deliver approximately 30,000 vehicles in the first quarter of 2024, significantly down from the previous outlook of 31,000 to 33,000 vehicles.

However, the company did not comment on its previously announced first-quarter revenue target of $1.48 billion – $1.56 billion, representing (1.7)% – 3.8% Y/Y growth.

During the fourth quarter, as reported earlier this month, the company’s vehicle deliveries slumped 9.7% from the third quarter to 50,045 units. Consequently, vehicle revenue plunged 11.3% Q/Q.

Following the quarterly results, Bernstein analyst Eunice Lee flagged in a note that the company’s market share has contracted from around 5% in 2021 to about 2% currently, despite the portfolio growing from three to eight models. The 2024 model cycle appears “challenging,” the analyst wrote.

In a press release dated March 5,  William Li, founder, Chair, and CEO of NIO, said, “we will soon start deliveries of 2024 NIO products equipped with the highest computing power among production vehicles and constantly enhance users’ driving and digital experience.”

Earlier this month, the company reportedly signed an agreement with battery giant CATL on a partnership to develop batteries with longer life to decline overall EV charges.

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The partnership between Nio and CATL will utilize battery technologies from both companies to reduce “full life circle” costs, which is crucial for Nio’s numerous battery swapping and charging stations, Li stated.

According to Benzinga Pro, NIO stock has lost over 45% in the past year. Investors can gain exposure to the stock via KraneShares MSCI China Clean Technology Index ETF ( KGRN ) and Invesco Golden Dragon China ETF ( PGJ ) .

Price Action: NIO shares are trading lower by 3.97% to $4.59 premarket on the last check Wednesday.