Nio, a prominent Chinese electric vehicle manufacturer, has recently unveiled its new lower-priced brand, Onvo. With the launch of its Onvo L60 SUV, Nio aims to compete with Tesla’s Model Y, the best-selling electric vehicle in the world. The Onvo L60 comes with a starting price of 219,900 yuan ($30,476), which is 12% lower than Tesla’s Model Y in China.
During the introduction of the Onvo L60 SUV in Shanghai, Nio’s CEO, William Li, emphasized the company’s goal of providing family cars that offer a satisfying customer experience while keeping ownership costs in check. Li mentioned that both Toyota’s RAV4 and Tesla’s Model Y set the benchmark for family cars in their respective times. However, as technology advances and people become more knowledgeable about smart EVs, Li believes it is time to redefine the standards for family cars.
One notable advantage of the Onvo L60 is its spacious interior compared to Tesla’s Model Y. However, the lower price tag of the Onvo brand presents an opportunity for Nio to expand its market beyond China. Although Nio had plans to enter the European market, an ongoing anti-subsidy probe initiated by the EU into EV imports from China has cast some uncertainty on these expansion plans.
In terms of performance, the Onvo L60 is equipped with Nio’s self-developed 900-volt fast-charging system and boasts an average energy consumption of 12.1 kilowatt-hours per 100 kilometers. This energy consumption is marginally lower than Tesla’s Model Y. Additionally, Onvo owners will have access to over 1,000 battery swapping stations and 25,000 public chargers owned by Nio.
One of the key factors enabling the competitive pricing of Onvo vehicles is Nio’s battery rental program in combination with a lower bill of materials. Chinese media reports that the Onvo car’s bill of materials will be 10% lower than that of Tesla’s Model Y. To further reduce costs, Nio recently struck a deal with BYD to source batteries for the Onvo lineup.
In terms of market share, Nio’s existing lineup, priced higher than Tesla’s Model 3, accounted for 3% of China’s overall EV sales in the first four months of this year. In comparison, Tesla delivered 163,841 units in China during the same period, capturing an 11.4% market share.
Overall, Nio’s launch of the Onvo brand represents its concerted effort to compete in the lower-priced segment of the electric vehicle market. The Onvo L60 SUV offers a spacious interior, competitive pricing, fast-charging capabilities, and widespread access to battery swapping and public charging stations. These features position Nio to challenge Tesla’s dominance and expand its market share beyond China. However, ongoing challenges such as the EU anti-subsidy probe and intense competition in the Chinese EV market will require Nio to navigate carefully to achieve its goals.
