EV Company Profiles — #1
Nio
China EV revolution Poster Child
Nio has recently come to the attention of many investors, with stellar results in last Q3 earnings report and a exceptional guidance for a promising future. As we will see the Company undoubtedly have much to offer, not only with the attractive vehicles produced, but also with innovative ideas that could turn out to be the key to take the lead both in China and on the World stage. Nio is on the forefront on China’s EV revolution together with Xpeng, Li Auto and BYD, companies which I will try to carefully analyse in the future, with the same format you can find here. So let’s get started and electrified!
The company
NIO’s Chinese name is Weilai, which means Blue Sky Coming and reflects the company dream and commitment to a more environmentally friendly future. This fundamental concept is evoked in the iconic logo, a circular symbol where the top represents the sky and the idea, while the bottom part means the earth and the necessary action needed to achieve the vision.
Founded in November 2014, the company is backed by several leading businesses and successful entrepreneurs, such as:
- Tencent: the company of Pony Ma is one of the Chinese Tech Giants. Is the world biggest video game vendor, among the largest social network with QQ and specially WeChat, which offer in its unique ecosystem a payment platform, a market place and much more.
- JD.com: the company of Richard Liu, also known as Jingdong, one of the biggest and fast growing Chinese e-commerce and the major competitor of Alibaba.
- Xiaomi: the company of Lei Jun, Chinese electronics corporation producing smart home appliances and currently the third smartphone manufacturer in the world
- Baidu: the company of Robin Li and Eric Xu, the Chinese Google and the second largest search engine in the World
- Lenovo: the company of Liu Chuanzhi, the Chinese computing machine and smartphone producer which acquired IBM personal computer’s business in 2005 and Motorola from Google in 2014.
Nio already have a global footprint, with a Design Center in Munich, Software Development in San Josè and Beijing, Vehicle Performance Team in London and Headquarters in Shanghai.
The Founder
“William” Li Bin is ofter called the “Elon Musk of China,” or “The Godfather of Chinese electric car industry.” Currently #133 on the Forbes “China Rich List 2020” with an estimate 8,4 Billions USD fortune. He owns around 14% of the company.
He was born on August 9th, 1974, in the humble village of Wuling, in the Anhui Province of China. His family was relatively poor (the village even didn’t have electricity until he was around 10 years old) and while the father worked in a coal mine, the mother was employed in a garment factory in a city far from the village, so for the most of the time William was raised buy his grandparents and uncle. As a teenager he started to help his grandfather with his local convenience store, counting money and keeping accounts, meanwhile beginning to grasp what a business was like.
His parents couldn’t provide for a high education, so they hope that he would attend to a technical school and find a job easily. But the young Li showed to possess quite a talent for studies, and at the age of 17th achieved the highest score for his province in the gao kao, the national college annual academic examination. William was therefore admitted to Peking University, one of the bests of China. He was than able to study at the same time in three Undergraduate Degrees: Sociology, Law and Computer Science. At one point, Li completed 17 exams in just one week! To pay for the studies, he also worked around 50 different part-time jobs, demonstrating a tremendous level of commitment to achieve results.
In 1996, at the age of 21, he founded his first business, Beijing Antarctic Technology Development company, a internet based startup, focused on bringing online local car firms. In 2000 Li founded BitAuto, an Online vehicle review website and a platform for selling and purchasing of used car, which turned out to be his first company to become extremely successful. In 2010 he took BitAuto public on the New York Stock Exchange, reaching 1 Billion USD value with the IPO. William is also one of the Founders and first investors of Mobike.
In November 2014, already a billionaire, he finally founded Nio with the desire to use his experience in the car and tech sectors and to be a pioneer in China’s premium electric vehicle market.
Li Bin currently serves as vice-chairman of China Automobile Dealers Association, or CADA, and was recognized by CADA in 2008 as one of the top 10 most influential and distinguished people in the Country’s automobile dealer industry in the past 20 years.
Models
The first model developed by Nio is the EP9 supercar, introduced in 2016. With an attractive design, the EP9 delivers extraordinary acceleration and best-in-class electric powertrain technology, helping position the company as a premium brand. This is one of the fastest Electric Car in the world: in 2017 sets new lap records for both the Nurburgring (6:45.9) and for Austin circuits (2:40.33),the second one with an Autonomous vehicle.
Since the beginning Nio has also been competing in the Formula E Championship and secured the inaugural FIA Formula E Drivers’ Championship in July 2015.
The first manufactured “volume” electric vehicle, the ES8, was launched to the public at the NIO Day event on December 16, 2017, and undertook deliveries from June 28, 2018. It is a 7-seater all aluminum alloy body, premium electric SUV, with a NEDC estimated range of around 580 km and a 0–100 km/h performance of 4.9 seconds.
The price stands at around 468,000 RMB (70,000+ USD),but with the incentives and with BaaS (Battery as a Service, of which we will talk later on)it could be down to 380,000 (58,000 USD).
In December 2018 NIO officially launched the ES6, a 5-seater high-performance premium electric SUV, and began deliveries in June 2019. The range for the ES6 is around 610 km and the 0–100 km/h performance is 4.7 seconds.
The price stands at around 358,000 RMB (54,000 USD) and with incentives and BaaS can go down to 273,000 (41,000 USD).
Most recently, just last October, Nio has launched the production and make initial deliveries of the EC6, a Coupe SUV based on the ES6 platform, with a range of 615 km and a 0–100 km/h performance of 4.5 seconds.
The price stands at around 368,000 RMB (56,000 USD) and with incentives and BaaS can go down to 280,000 (42,000 USD).
In conclusion, the company is expected to present its first Sedan, presumably named ET7, the next January 9th Nio Day Event. A second Sedan is also rumored to be announced during 2021.
Battery Technology and BaaS
One of the key points in the company’s strategy is the Battery as a Service idea. Nio have developed cars in which the battery can be swapped, replaced, and even upgraded in time. This design provided to them the chance to propose the BaaS model. Users who choose a NIO model with BaaS do not have to buy the accumulator: they can subscribe to batteries of different capacity and pay a fee on a monthly basis in accordance with their actual needs.
The advantages of this business model have become apparent just this month, when Nio presented the new 100 kWh battery, an improvement on the previous 70 kWh unit. Users who buy a NIO vehicle with the 70 kWh model with BaaS can immediately enjoy RMB 70,000 off the price and only pay RMB 980 per month for the subscription. For the purchase of a NIO car with the 100 kWh accumulator with BaaS, RMB 128,000 will be reduced from the vehicle price with a monthly battery subscription fee of RMB 1,480 per month. Users of the 70 kWh unit can choose to either purchase the new battery for a permanent upgrade, or flexibly upgrade to it for RMB 880 per month or RMB 7,980 per year. The flexible monthly and yearly upgrade represent a bold innovation by NIO to cater to users’ diverse travel needs in various scenarios.
With over 300 patents, the 100 kWh battery features the CTP (cell to pack) technology, realizing 37% higher energy density. Powered by this new unit, the NEDC range of NIO models can now reach up to 615 km. While announcing this new 100 kWh pack, Nio also revealed they are already working on a 150 kWh battery, which could take the range up to 900 km. Those batteries are produced in partnership with CATL.
Connected to this business model, there is also the Swap technology. Opposed to the Supercharger model of Tesla, the design of Nio’s car allow for batteries to be swapped into specially designed stations in something like 5 minutes, a comparable time with loading up at a fuel station for ICE vehicles.
This idea has also been recently favoured by the Chinese government, which is defining a “Swap System Standard” according to Nio’s one, calling the plan “Blue Sky”…too good to be just a coincidence. The advantage for the government could be that deploying on the territory these kinds of stations, basically will connect a lot of energy capacity to a smart grid, helping to smooth electricity picks of demand. Together with a bold plan for steadily increasing renewable power sources, this could help to decrease China’s need for outside oil and energy purchases, at the same time promoting to boost National economy.
As of today Nio has deployed 158 battery swap stations nationwide. Together, they have served users with over 1.18 million battery swaps.
Nio Life, autonomous driving and more
The company promotes its vehicles through its own sales network, including NIO Houses and our mobile application. NIO Houses are not only the showrooms for vehicles, but also clubhouses for car owners, with multiple social functions.
Nio, together with Tesla, has been so far the only producer to achieve Level 2 autonomous driving. NOMI is one of the most advanced in-car AI assistants developed by a Chinese company and the World’s first voice activated AI digital companion that personalizes the user’s driving experience.
Other service and products goes from Power Home, home charging solution, to Power Mobile, a mobile charging service through trucks, and Power Express, a 24-hour on-demand pick-up and drop-off charging solution, to create a complete user experience throughout the vehicle lifecycle and a brand recognition and fidelity among customers.
With so many things going on in the NIO ecosystem, I essentially can say that the (Blue) Sky is the Limit.