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NIO Inc., China’s home-grown answer to electric-car maker Tesla Inc., plunged after a worse-than-expected quarterly loss triggered thousands of job cuts and exacerbated concerns that a bubble in the world’s largest EV market may be bursting.

The dire situation has prompted the automaker, which is backed by technology giant Tencent Holdings Ltd., to raise $200 million from founder William Li and a Tencent affiliate, and to plan the spin off some businesses. Its U.S.-listed shares dropped as much as 28% to less than $2 on Tuesday and are off more than 80% from their peak following last year’s IPO.

“People are wondering whether the company can continue to survive,” said Jason Chen, an analyst from Blue Lotus Capital Advisors. Bernstein analyst Robin Zhu struck a similar tone with a report titled “Tick Tock, Tick Tock,” estimating that NIO has only a few weeks of liquidity left.

The issues specific to Shanghai-based NIO include cost overruns and major recalls. More broadly, the automaker’s struggles lend credence to mounting concerns that China’s state-sponsored support of the industry inflated a bubble that’s poised to pop. The nation’s sales of EVs and “new-energy” vehicles fell for a second straight month in August as the government scaled back subsidies. China accounts for half of the world’s EV sales.

NIO’s second-quarter net losses increased 83% from a year earlier to 3.29 billion yuan ($462 million), according to a statement. The deficit was worse than the 2.6 billion yuan average estimate of two analysts surveyed by Bloomberg, and it was the company’s second-largest based on available data dating back to 2017.

NIO has accumulated about $6 billion in losses since it was founded by Li, who is also the chief executive officer, in 2014. Fire risks led to a mass callback of nearly 5,000 vehicles in June, a significant portion of the 17,550 units NIO had sold as of the end of May.

Li said in the statement that a target has been set to reduce global headcount to 7,800 by the end of the third quarter, from more than 9,900 in January. There will be additional restructuring and some non-core businesses will be spun off by the end of the year, he said, without elaborating.

A Tencent affiliate and Li agreed to buy $200 million of convertible notes through a private placement that’s expected to close before the end of the month, NIO has said. The company canceled its earnings conference call without explanation, a move Chen called “very strange.”

Though revenue surged more than 3,000% from a year earlier, that was a time when the company was just getting started to sell cars. It fell 7.5% from the first quarter.

NIO delivered 11% fewer vehicles compared with the first quarter, but it forecast the number will rebound to between 4,200 and 4,400 units in the third quarter. Third-quarter revenue will rise as much as 10% from the previous three months, the company said.

NIO previously scrapped plans for a manufacturing plant in Shanghai after the government decided to provide support to Tesla, which aims to start production in China this year – another challenge for Li’s company. Annual capacity at the Tesla facility could eventually top 1 million vehicles, chief executive Elon Musk has said.

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