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Sunday, April 18, 2021

Nio Inc (NYSE: NIO) Looking to Dominate the Chinese EV Market

Nio Inc (NYSE: NIO) the Chinese EV Pioneer is making big moves up the charts and continues to rocket higher as the Company looks to dominate the market and become the Tesla of China and they are well on their way. The demand for NIO EV vehicles is huge and growing fast. NIO delivered 12,206 vehicles in the third quarter of 2020, including 8,660 ES6s, 3,530 ES8s and 16 EC6s, compared with 4,799 vehicles delivered in the third quarter of 2019. Q3 revenues came in at US$666.6 million representing an increase of 146.4% from the third quarter of 2019.

NIO is quickly emerging as the dominant player in China, the world’s biggest vehicle market with 2.57 million vehicles sold in September. according to the China Association of Automobile Manufacturers (CAAM). With China set to mandate 25% of new cars sold by 2025 to be EV the future looks golden for NIO. Recently NIO CEO William Li said that the company will triple manufacturing capacity to 150,000 EV vehicles by next year.

Nio Inc (NYSE: NIO) operating out of Shanghai, China is a pioneer in China’s premium smart electric vehicle market. NIO is founded on the principal that “the future is in smart, electric and autonomous vehicles, and we aim to lead the way. NIO designs, jointly manufactures, and sells smart premium electric vehicles, driving innovations in next-generation technologies in connectivity, autonomous driving, and artificial intelligence. NIO has implemented NOMI into its EV offerings; an artificial-intelligence technology, claimed to be the first in-car AI system in production vehicles. NOMI can pull up the cars navigation, control the music, and unique to NIO cars can take a selfie of the passengers in the cabin.

NIO began deliveries of the ES8, a 7-seater flagship premium electric SUV, in China in June 2018, and its variant, the 6-seater ES8, in March 2019. NIO officially launched the ES6, a 5-seater high-performance premium electric SUV, in December 2018 and began deliveries of the ES6 in June 2019. NIO officially launched the EC6, a 5-seater premium electric coupe SUV, in December 2019 and began deliveries of the EC6 in September 2020.

While NIO EV cars are still significantly more expensive than Tesla, in China NIO is quickly becoming the favorite and its easy to see why; in China, NIO provides customers with comprehensive and convenient power solutions, the innovative Battery as a Service (BaaS) program, and other user-centric services. Unlike Tesla, which has tried battery swapping but has never deployed it on a large scale and relies instead on its Supercharger network, Nio has built a functioning network of over 140 battery-swap stations in over 60 Chinese cities that cover a few thousand kilometers of Chinese expressways. NIO buyers are also eligible for subsidies from the Chinese government whereas Tesla is not. The subsidy to purchase EVs under 300,000 yuan only applies to manufacturers that use swappable batteries.

In August, NIO launched the innovative Battery as a Service (the “BaaS”) subscription model and announced the establishment of Wuhan Weineng Battery Asset Co., Ltd. The BaaS model allows users to purchase electric vehicles and subscribe the usage of battery packs separately. If users opt to purchase an ES8, ES6 or EC6 model and subscribe to use the 70 kWh battery pack under the BaaS model, they can enjoy the vehicle purchase price with an RMB70,000 deduction off the original price and pay a monthly subscription fee of RMB980 for the battery pack. Meanwhile, the users will continue to enjoy the existing favorable policies such as purchase tax exemption and government subsidies for EVs.

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NIO

NIO is also involved in the FIA Formula E Championship, the first single-seater, all-electric racing series. The NIO team is one of the original Formula E teams, originally competing under the name Team China Racing. In this inaugural season, their main driver Nelson Piquet Jr became the FIA Formula E Driver’s Champion, after winning two races in Long Beach and Moscow

Demand for NIO is super strong in China; NIO began making deliveries of its new EC6 model last week and the Company can hardly keep up with the demand. According to NIO CEO William Li: “Demand in July and August was even stronger than actual deliveries because we had a sales estimate at the beginning of the year; our supply chain partners were not ready for even higher production. We are working to solve this in the current quarter. We believe production capacity in September. We are boosting production especially for the EC6 which started deliveries over the weekend.

 

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Currently making a poweful move northbound NIO is the Chinese EV Pioneer that is looking to dominate the market and become the Tesla of China and they are well on their way. The demand for NIO EV vehicles is huge and growing fast. NIO delivered 12,206 vehicles in the third quarter of 2020, including 8,660 ES6s, 3,530 ES8s and 16 EC6s, compared with 4,799 vehicles delivered in the third quarter of 2019. Q3 revenues came in at US$666.6 million representing an increase of 146.4% from the third quarter of 2019. NIO is quickly emerging as the dominant player in China, the world’s biggest vehicle market with 2.57 million vehicles sold in September. according to the China Association of Automobile Manufacturers (CAAM). With China set to mandate 25% of new cars sold by 2025 to be EV the future looks golden for NIO. Recently NIO CEO William Li said that the company will triple manufacturing capacity to 150,000 EV vehicles by next year. On the record Q3 2020 results CEO William Bin Li: “We achieved a new record-high quarterly deliveries of 12,206 ES8s, ES6s and EC6s in total in the third quarter of 2020, followed by the best-ever monthly deliveries of 5,055 vehicles in October. In view of the growing market demand for our competitive products, we are motivated to continuously elevate the production capacity to the next level. We expect to deliver 16,500 to 17,000 vehicles in the coming fourth quarter.” We will be updating on NIO when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with NIO.

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Disclosure: we hold no position in NIO either long or short and we have not been compensated for this article.

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