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China-based electric automaker Nio has demonstrated enormous growth this year. Tesla rival plans to expand into global markets in 2021.
Tesla Inc (NASDAQ: TSLA) rival Nio Inc (NYSE: NIO) is up 240% this year despite the economic down plunge caused by the coronavirus pandemic. Following this impressive growth, the electric automaker Nio has declared that it has plans to venture into other markets starting in the second half of next year.
The electric automaker with roots from China recently survived bankruptcy toppled by a net loss of more than 1.17 billion yuan ($166.5 million) in the second quarter. During its internal crises, several of Nio executives, including one of the founders and the company’s leaders in the UK and the U.S., have left, followed by many layoffs.
The financial resuscitation of Nio came amid the outbreak of the coronavirus pandemic when the company entered into funding talks which later helped it secure 7 billion yuan ($1 billion) from investors with China’s Hefei government playing a crucial role. Following the cash injection, NIO stated back in April that it will not lower its annual forecast for 2020.
“Nio hasn’t lowered its annual forecast as a result of the virus. There was certainly some impact in the first quarter, but for the second quarter, right now we don’t think there is much of an impact to the original plan,” stated Nio CEO William Li.
Appraising Nio 240% Growth
Nio growth recorded thus far comes with a boost in the number of deliveries made by the company. As Coinspeaker reported, the Tesla (TSLA) challenger indicated that business has been great. The company has shown higher deliveries of 3,740 in June and 3,533 cars in the past month bringing the total deliveries in the second quarter to 10,000. While this feat represents a 322% rise from the same period last year, the firm claim that its shares currently pegged at $13.78 is up by 240% this year
“We hope in the second half of next year we can begin making some preliminary attempts in some countries that are more welcome to electric vehicles,” Li, told reporters on Thursday. That’s according to a CNBC translation of his Mandarin-language remarks.
Li confirmed that the expansion will begin in Europe, but without mention of the specific countries in the electric car-loving region.
New Product Unveiled
Nio has unveiled a Battery as a Service subscription program that is projected to carve a niche for it in the electric car industry. With the initiative backed by the Chinese, the subscription plan will aim to reduce the upfront cost of Nio vehicles and can be compared to a regular gasoline charge as Li noted.
According to CNBC, the new battery product initiative has drawn support from three investors including a new battery asset company in Wuhan, China, whose three other investors are: the leading battery developer Contemporary Amperex Technology (CATL), Hubei Science Technology Investment and financial services company Guotai Junan International. Each company is investing 200 million yuan and will have a 25% equity interest.
Projecting the long term expectation for the BaaS, Li hopes that with interest from key automakers such as BMW, Benz, and Audi amongst others, the Nio BaaS product can elevate its position in the industry.