XPeng shareholder sells stock. It does not raise money for the EV company.

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Shareholders of a Chinese electric vehicle manufacturer

XPeng

they seem to be selling stock. The sales will not raise additional growth capital. This is a secondary stock sale, in which some early investors take money off the table.

On Tuesday, reports said that XPeng shareholders (ticker: XPEV) will offer about 10.5 million American investment disposals, or ADRs, between $ 32.25 and $ 35.75 a share, depending on where the broker that handles the a large block of stock able to set the price.

Each ADR of XPeng represents two categories of common stock.

XPeng stock closed Monday at $ 38. Large blocks are often priced at a discount on the market as it is difficult for brokers to sell large stocks at once. About 15 million XPeng shares are traded every day, so there is almost 10.5 million to put on any given day.

XPeng reported Barron’s he cannot comment on the sale of stock to others. But this move should come as no big surprise to investors. The sale of the stock comes as a lock for sale in connection with the expiration of XPeng’s original public offering. Investors and early investors are often barred from selling shares in a new public company for a period of time, usually 180 days. XPeng IPO device replaced in late August, about six months ago.

XPeng stock, coming in Tuesday, was down about 21% in February. Stock in Xpeng peers

Li Auto

(LI) and

NIO

Shares (NIO) were down closer to 10% for the month, as were stocks in a larger competitor than Chinese companies,

Tesla

(TSLA). Investors had apparently been selling some shares before the IPO lockout was lifted.

XPeng stock was down 10.3% in morning trading at just over $ 34. NIO and Li shares are also lower, around 14% and 12%, respectively. Tesla stock was down almost 11% to around $ 639. That’s less than the price at which Tesla shares entered the S&P 500 at the end of December.

High school sales cannot be blamed for the total fall in XPeng or other Chinese stocks. U.S. stocks are falling and high-growth stocks are becoming more difficult. The

Nasdaq Composite,

Home to many high-tech stocks, it fell about 3% after the index fell 2.5% on Monday.

There seems to be a fear of inflation as a catalyst for sale. Investors are concerned that all stimuli the government will pump into the economy will lead to higher prices, an overheated economy and, ultimately, higher interest rates.

High-growth stocks, such as those of EV companies, tend to fall harder as interest rates rise. High rates cause investors to reassess what they pay for growth. Why invest in something that would generate cash flow and pay shares far down the road when there are options to generate investment income now?

Write to Al Root at [email protected]