China’s premium electric vehicle maker Nio is making significant strides in the EV market, with plans to unveil a new model under its mass-market brand, Onvo, by the end of this month. The CEO of Nio, William Li, has stated that this new EV will directly compete with the Tesla Model Y, which currently holds the title of the world’s best-selling EV. Nio is also gearing up to introduce a second smaller EV, expected to be priced at less than $30,000, specifically for sale in Europe next year.
During a France-China business forum in Paris, Nicolas Vincelot, the general manager for France, shed light on Nio’s plans for expansion. He revealed that Nio has created two sub-brands to cater to different market needs. The first is Onvo, which will focus on providing less premium but still 100% electric vehicles specifically designed to meet the European market’s demands. The second sub-brand, code-named Firefly, is working on developing smaller EVs suitable for city driving that will also be priced under $30,000.
To support its expansion into Europe, Nio has launched a new website for the Onvo brand in China, signaling its imminent arrival in the European market. The website features a message urging visitors to “stay tuned” for more details about the upcoming model, known as the L60. Vincelot mentioned that additional information about the brand, previously referred to as “Alps,” will be disclosed by the end of the month.
Both Onvo and Firefly will be compatible with Nio’s pioneering fast battery swapping stations, which allow drivers to quickly exchange their empty batteries for fully charged ones in just a few minutes. This innovative technology addresses one of the key challenges associated with EV ownership: long charging times. By offering battery swapping options, Nio aims to provide a seamless and convenient experience for its customers.
While Nio focuses on expanding its presence in Europe, it faces competition from other Chinese EV manufacturers. For instance, Xpeng has plans to introduce a new mass-market brand called Mona, which will offer self-driving features at an affordable price point below $21,000. The increased presence of Chinese EV makers in Europe is attributed to their cost advantage and strong competition in the local market.
To adapt to changing market dynamics, Nio is shifting its business model from relying primarily on subscriptions to adopting a wider distribution approach. The company plans to sell and lease cars through various channels, including online platforms and showrooms in major cities. In Europe, Nio has already started selling cars in countries such as Norway, Denmark, Sweden, Germany, and the Netherlands.
Nio’s efforts to streamline costs and improve efficiency are evident in its decision to reduce staff by 10% last year. Additionally, there were reports that the company was contemplating spinning off its battery manufacturing division. These measures reflect Nio’s response to a slowdown in EV sales and intense pricing competition in China.
As Chinese EV makers look beyond their domestic market, the European Union is investigating Chinese EV imports to ensure compliance with competition rules. Nicolas Vincelot’s comments coincided with Chinese President Xi Jinping’s visit to France, where discussions between President Xi and French President Emmanuel Macron, as well as EU Commission chief Ursula von der Leyen, were expected to address the EU investigation.
Overall, Nio’s unveiling of a new model under its Onvo brand, combined with its plans to introduce a smaller EV for the European market, demonstrate the company’s commitment to expanding its global footprint. With the introduction of innovative battery swapping technology and its shift towards a wider distribution model, Nio aims to solidify its position as a leading player in the competitive EV market.
