Fisker Isn’t Afraid of Competition. The EV Maker Is Headed to China.

“After beginning deliveries in Europe and with first vehicles coming to our U.S. customers on June 23, we are excited to move into the Chinese market later this year,” said CEO Henrik Fisker in a news release.

China is the world’s largest market for new cars and new EVs. About 4.7 million all-battery electric vehicles have been sold in China over the past four quarters, according to Bloomberg BNEF. That is about 60% of the world’s total. What is more, about 30% of new cars sold in China in recent months have been electric. U.S. EV penetration is at about 8%.

Fisker stock was up 1.2% in midday trading Friday while the

S&P 500
and

Nasdaq Composite
were up 0.1% and 0.2%, respectively.

On Thursday Wolfe Research downgraded shares of Fisker to Sell from Hold, citing EV competition. In the U.S., the Fisker Ocean SUV enters a relatively saturated part of the EV market. The vehicle has to compete, to some extent, with the likes of a

Tesla

(TSLA) Model Y and a

Ford Motor

(F) Mach E, among others.

And that is just in the U.S. There are many more EV makers and EV models in China than in the U.S. Fisker is optimistic, though.

“We expect China to be an important growth market for EVs in the future and believe our vehicles will be very appealing,” he added in the news release.

With the Thursday downgrade, 33% of analysts covering the company rate shares Sell, according to FactSet. The average Sell-rating ratio for stocks in the S&P 500 is less than 10%. One-third, or 33%, rate Fisker shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 53%. The average analyst price target for Fisker shares is almost $10.

Fisker stock is down about 36% over the past 12 months. Rising interest rates and as well as more EV competition have sapped some investor enthusiasm for EV start-up stocks.

Write to Al Root at [email protected]