Chinese EV maker Nio falls behind on sales with revenue outlook missing estimates
NIO reported a quarterly loss of 4.6 billion yuan (S$864.5 million) and gave an outlook on revenue and electric-vehicle deliveries that missed estimates.
The Chinese EV maker expects revenue of up to 16.7 billion yuan in the three months through December, short of the 21.4 billion yuan average estimate from analysts. Nio expects to sell 47,000 to 49,000 vehicles in the quarter, it said in a statement on Tuesday (Dec 5). Analysts had forecast 59,426 sales.
Once considered one of the brightest rising stars in China’s EV market, Nio is yet to post a profit and is falling behind sales targets. It had a goal of shipping 250,000 EVs this year, but reached only 142,026 by the end of November.
“We have identified opportunities to optimise our organisation, reduce costs and enhance efficiency,” chief executive officer William Li in the statement. “Our focus remains on advancing core technologies, developing key products, and expanding sales and service capabilities. We are confident in Nio’s long-term competitiveness.”
The company cut 10 per cent of its workforce in November and considered spinning off non-core businesses to reduce costs, even after an Abu Dhabi government-backed investment fund injected nearly US$740 million in June in return for a 7 per cent stake. Nio also sold US$1 billion of convertible bonds in September, and Bloomberg News reported it was considering raising a further US$3 billion from investors.
Nio’s New York-listed shares have declined 25 per cent this year, trailing those of rival Chinese EV maker Xpeng, which has rallied 61 per cent, and Li Auto, up 76 per cent. Nio fell 69 per cent in 2022 and 35 per cent in 2021 after surging more than 1,000 per cent in 2020.
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Nio was founded in 2014. Its strategy includes splashy showrooms with exclusive lounge-like spaces called Nio Houses, where EV owners can get complimentary beverages and join social events. Other membership-like benefits include free battery-swapping, charging and roadside assistance.
The Shanghai-based company is striking deals with rivals to boost revenue, recently signing agreements with Chongqing Changan Automobile and Geely Automobile Holdings to partner on battery-swapping technology.
Third-quarter revenue rose 47 per cent from a year earlier to 19.1 billion yuan, it said.
Nio also said it will pay 3.2 billion yuan to acquire manufacturing equipment and assets from Anhui Jianghuai Automobile Group Corp., which has helped produce the company’s EVs. Nio has just been approved by the government to make automobiles independently. BLOOMBERG
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