Nio Inc – ADR (NYSE:NIO)
According to three people familiar with the situation, the Chinese manufacturer of electric vehicles Nio Inc. (NYSE:NIO) intends to construct a factory in which low-cost electric vehicles will be manufactured under a new brand name and exported to Europe beginning as early as next year.
The decision to end state subsidies for the purchase of electric vehicles in China, the world’s largest auto market, has resulted in a sharp decline in sales of electric vehicles (EVs), prompting the company to announce plans to expand its product lineup and increase sales in international markets.
According to the people, who asked not to be identified because the discussions are private, Nio has been planning to launch more affordable electric vehicle products under new brand names after 2024 as part of projects codenamed “Firefly” and “Alps.” These people also declined to be named.
They said that the new factory will be built in Chuzhou city in the Anhui province of eastern China. They also said that the plant will make automobiles that were developed under the project known as “Firefly.” Nio intends to export these automobiles to Europe, where consumers prefer smaller-sized vehicles.
In the city of Hefei, which serves as the capital of the province of Anhui, Nio already operates two assembly plants for automobiles. The manufacturer’s prices in Europe range from approximately 50,000 euros ($53,265) to 91,000 euros, with the range of the vehicle and whether or not customers choose to buy or rent the battery determining the price range for each option.
A request for the company’s comment was not met with an immediate response from the business. A representative from the Chuzhou Economic and Technology Development Zone, which is going to be the site of the Nio plant, declined to comment on the matter.
Cailianshe, a Chinese news outlet, was the first to break the story about the new development.
As the demand for electric vehicles (EVs) increases rapidly in China, Chinese electric vehicle players, the majority of which are still operating at a loss, are stepping up their efforts to increase their market share. More than one-quarter of the new cars sold in January were either pure electric or plug-in hybrid vehicles in China.
While Tesla Inc. relies on two models for the majority of its sales in China, a strategy that has helped the company keep costs under control, many Chinese brands offer more models in order to appeal to a wider consumer base. Tesla Inc. relies on its Model S and Model X vehicles.
Nio currently has six different models available for purchase and has plans to introduce an additional five under the Nio brand this year. The Nio brand is intended to compete in the premium market alongside established names such as BMW, Mercedes, and Audi.
Featured Image: Pexels @ Maria Geller
