James Yang Jianwen’s Summary of NIO’s 7-Year Journey

Yesterday marked NIO’s 7th anniversary. Seeing this number, I couldn’t help but feel a sense of disbelief – time flies by so fast.

On NIO’s official account, NIO did a simple review of its past:

• Delivery: On May 31st, 2018, the first NIO ES8 was officially delivered, marking the beginning of NIO’s journey from zero to one. Currently, NIO has over 150,000 users who have driven over 3.4 billion kilometers.

• Software Updates: On October 31st, 2018, version ES81.1.0 was first pushed over-the-air via FOTA. Currently, NIO has pushed over one million vehicle software updates, introducing 182 new features.

• Battery Swapping Network: On May 20th, 2018, the first NIO battery swapping station was completed in Shenzhen. Currently, NIO has installed 640 battery swapping and 486 supercharging stations throughout the country. Users have utilized NIO’s instant power replenishment service over 700,000 times. NIO’s “Power Up Plan” continues to build charging routes towards popular destinations, with the goal of forming a “five vertical and three horizontal” fast-charging network covering the four metropolitan regions of China.

• Sales Network: On November 25th, 2017, the first NIO House opened at No.1 Chang’an Street in Beijing. Currently, there are 34 NIO Houses around the world, including the first NIO House in Norway. Over the past 7 years, NIO House has received over 14 million users and hosted over 95,000 events.

• Service: On July 5th, 2018, NIO Service provided its first on-site service. Currently, NIO Service has provided over 3 million services to users. There are 43 NIO service centers and 180 authorized service centers nationwide.

• NIO App: On November 3rd, 2017, the first post was published on NIO App’s “Moments” section. Currently, users have shared over 4 million posts, 3.4 million photos, and over 33 million “likes” and interactions. (Note: According to July 2021 data, NIO App has over 1.6 million registered users, with daily active users surpassing 200,000.)#NIO Life: Since 2017, NIO Life has sent out 4 million “surprises” including the first popular product “Little Devil Cap”, which is a testament to NIO’s 7-year achievement.

However, my deepest perception of NIO is not the growing numbers, but the hardships it has gone through, which have given me a better understanding of this company.

About “Life and Death”

NIO has experienced life and death.

In 2019, the OTA incident on Chang’an Street, the ES8 spontaneous combustion incident, and subsequent large-scale events dealt a severe blow to NIO. Especially the latter, which was devastating to NIO. During this time, NIO did not continue to receive blood transfusions.

That year, NIO lost more than 10 billion yuan in a year, and at its worst, it was basically counting the days to spend money. “If this money doesn’t arrive or there is a problem today, there may be news events tomorrow,” and such days lasted for several months.

At that time, NIO was in a difficult situation, and the stock market even fell to as low as $1.19 per share. Whether NIO would die or be delisted became the focus of discussion.

During that roller coaster experience, Li Bin, the chairman of NIO, also learned a lesson: capital rarely speaks of feelings.

NIO not only did not die, but also the team cohesion and combat effectiveness became stronger. What did they do right? It was “product + user experience + brand positioning”.

After surviving the ordeal, everyone knows the story of what happened next – Hefei gave NIO a hand, and the users gave NIO a hand…

NIO came back to life, and at its highest, its market value exceeded $100 billion, making it the leader in the Chinese auto market stock market value.

For a while, Li Bin went from “the most miserable person” to “the happiest person”.

And this positive trend has continued from 2020 to 2021.

Now, NIO has three mass-produced cars, with monthly sales pushing towards 10,000, and the average transaction price per vehicle has exceeded RMB 400,000…

One signal revealed is that the high-end brand image of NIO has been firmly established.

About “User Enterprise”

NIO is a user enterprise. This is what Li Bin said.

Previously, the biggest perception was probably the “Haidilao-style” service that truly puts the user first.In that difficult year of 2019, we felt the power of the users in reverse, as they saved NIO by spontaneously advertising and selling cars for the company, allowing it to steadily recover. In that year, 45% of orders originated from referrals by old users.

During the pandemic in 2020, 69% of referrals still came from old car owners, even in the later stages of the epidemic when it had eased, maintaining around a 40% ratio.

That was when I truly understood the meaning of a user-based enterprise. Although NIO has not released data on this part of their business lately, the charm of NIO’s user-based enterprise model can still be felt through the NIO APP.

On “Survival”

When NIO was being questioned by the public, the statement by Li Bin: “NIO is still a four-year-old company; you cannot ask a four-year-old child to support the family” really resonated with people.

Now, at 7 years old, although NIO is still unable to support itself, it has clearly become stronger. Overall losses are narrowing and gross profit is gradually increasing (with overall gross profit reaching 20.3% in the third quarter of this year), meaning that NIO is beginning to generate its own revenue.

NIO has also been very active this year: new factories, offline stores, and energy supplementation networks are all under active construction. One very visible example of this is that Qin Lihong, the co-founder and president of NIO, updates his friends on the progress of NIO’s energy supplementation network every day on social media.

NIO is really working hard now. Next year, NIO will have its own brand new sub-brand and three new cars will be delivered to customers. We are getting closer to achieving the small goal of “survival”.

Conclusion

Seven is a magical number. There are seven days in a week, and the cells of the body are replaced every seven years; even the Book of Changes describes the “returning of seven days”. Personally, I believe that 7 is a number that symbolizes restarting and change.

A few years ago, NIO was just a youngster and not given much attention by traditional giants. Now, 7-year-old NIO has become the leader of domestic new energy vehicles, and even more traditional car companies are actively learning from NIO’s services and business model.

At the milestone of 100,000 NIO vehicles, Tesla’s CEO Musk, the leader in the new energy vehicle field, also sent his congratulations from afar.

All this is a recognition of NIO.

Currently, NIO doesn’t need to deliberately create topic traffic, because NIO is the traffic itself. The Guangzhou Motor Show is a good case in point:

On NIO’s birthday, someone posted this on their social media: “Top-class entrepreneurs talk like dreamers and act like doers.”

Isn’t this a true portrayal of Li Bin and NIO over the past seven years?

This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.