This article is reproduced from the autocarweekly public account.
Author: Karakush
The UP host of NIO has launched this year’s new car, ET5, a few days ago.
As soon as it was released, it attracted a lot of attention and was searched for by many people. It is rumored to be the model with the highest number of new car orders ever, even exceeding NIO’s preparation. After Li Bin announced the start of pre-orders at NIO Day, the NIO APP was crowded and crashed for more than ten minutes. Even every big brother I met the next day had ordered an ET5, it was so magical.
A popular model?
There is indeed a reason for the passionate demeanor of the release.
First of all, it is entry-level friendly. ET5 is an entry-level model created by NIO for young people. It is a medium-sized model with a length of 4790 mm, and it can easily drive in most parking lots. It can also accommodate some extra luggage. It is suitable for both single people who want to drive freely and people who want to carry more people. Its appearance is in line with its positioning. It inherits the lines of the ET7 and restructures its youthful proportion, showing a heavier downward force, demonstrating the passion of kissing the ground when driving. We, young people of advanced age, especially like the God’s-eye view from high above. The 1.28 square meter sunroof places the faith of “Blue Skying Coming” on top of us. You can always trust the light and the design of NIO.
Secondly, ET5 and ET7 belong to the same platform of NIO’s second generation. When ET7 was launched at the beginning of the year, it was expected to be extremely popular and caused countless frenzies among its competitors. ET5 retains the core configuration.
For example, the endurance. With the optional 100 kWh battery CLTC, the endurance exceeds 700 kilometers, and with the 75 kWh battery, the endurance exceeds 550 kilometers, which is quite sufficient. If equipped with a legendary 150 kWh battery, the endurance can exceed 1,000 kilometers, which is sufficient for long-distance travel.
Another example is performance. It insists on the traditional dual motors, with good parameter quality and zero-to-100-kilometer acceleration in 4.3 seconds; both front and rear use five-link suspension, and you can choose the NIO’s self-developed four-piston aluminum monoblock brake calipers for free.And the most striking feature is its intelligent system, which is still equipped with four NVIDIA Orin chips offering 1016 TOPS of computing power, even without a downgrade in components. It also has 33 sensors, with four Sony-specific cameras replacing the previous ones, reportedly providing better performance in terms of panoramic display and low-light imagery. This is an iteration of the original strategy for the ET7 model, which will continue to be updated until delivery, rather than being released and then closing production.
Based on this hardware, the ET5 can also be equipped with NAD services, which are NIO’s proprietary autonomous driving features, for a monthly fee of 680 yuan, gradually realizing smart driving in scenarios such as highways, urban areas, parking, and battery swapping.
Moreover, NIO has also released its PanoCinema panoramic digital cabin with a new AR technology partnership between NREAL and NOLO VR. These new exclusive AR glasses offer a screen size equivalent to 201 inches at a range of 6 meters. In addition, the company has also developed its own VR glasses, which can deliver dual 4k displays and be applied to many different functions.
According to the company, ET5 is the first car model to be natively designed for AR/VR. William Li, the company’s founder, says that this is a long-term and well-thought-out strategy, aiming to eliminate screens by making the car interiors lighter. He also believes that other car manufacturers will soon follow this path.
To achieve this vision, NIO has invested heavily in both equipment companies, and the ET5 comes with 7.1.4 Dolby panoramic sound as a standard feature to ensure the best user experience. Nevertheless, only good results count, as any lack of it would be a foolish expense, and the verdict remains pending.
Most importantly, all of these features are included in the price range of RMB 328,000 (75 kWh battery) to RMB 386,000 (100 kWh battery). The threshold for entry battery rental services, BaaS, is lowered to RMB 258,000, with battery monthly repayment of RMB 980/1480, making it a light luxury product that can also be affordable for common people.
In this price range, competitors are not matchable.NIO’s move this time is in order to clearly target its competitors: 5>3, referring to the BMW 3 Series and Tesla Model 3. In terms of traditional luxury oil-based vehicles and their intelligence gap across generations, and if we consider factors such as license plates and purchase taxes, the actual cost of products of the same level can cost much higher; as for the classic king of electric vehicles, if we lock in dual motors and necessary configurations, there is no absolute cost performance advantage. Perhaps the ET5’s comprehensive advantages of swapping batteries, services, and ecology make it the most cost-effective choice.
For those stubborn friends that insist on comparison, it can be tedious. The 300,000 yuan mark is already a level where faith can be discussed, and the conclusion itself depends on which qualities you use as the standard for measurement. Even if you have eight hundred longboards, it is impossible to make up for the lack of “two kidneys” and “a front trunk”; therefore, there is no way to judge what is good or bad.
Therefore, it is more worthwhile to explore the ET5’s instant breakthrough for the “non-factional” crowd. Without meticulous calculation or comparison, how can it attract attention so quickly through an hour and twenty-minute (including a song and dance break) press conference? In this era of fierce competition where everything moves at lightning speed, while it can break out explosively, can it last long enough, and is there any indication of long-term sustainability?
For example, the first slight climax that surprised the audience after the unveiling of the ET5 was when Li Bin announced that the ET5 offers a total of nine colors. Among them, two exclusive colors – an emoji yellow and Linna Bell pink – cost an additional 10,000 yuan. Colors are a particularly vulgar old trick in the market, but when NIO does it, even the vulgar becomes unique.
The last time a group of people was excited about colors was when Apple introduced the fairy blue of the iPhone 13. You will find that behind every color that has commercial success, it is not because of Pantone’s amazing skills but because it is Apple or NIO that has come up with that color. If it is placed in a low-end brand, then it is useless.
The fatal attraction of the ET5 also lies in the fact that, based on the premise that it is first and foremost a NIO, it is not only a product but also contains a range of NIO vehicle owner experiences, including three-minute battery swaps, human-to-human services, high-end identity recognition, and a strong sense of belonging to the user community.
Compared to entering the world of entry-level luxury, the ET5 is more like an entry point into the “NIO universe,” and it is currently the cheapest entry point, perhaps even the cheapest entry point that NIO can offer.This project began in early 2020. Li Bin requested the design team to build the smallest and purest car possible around the battery swapping system. It is more difficult to produce a sedan with a battery swapping system because the height is 200-300 mm lower than an SUV. The battery needs to be placed at the bottom, and the swapping mechanism needs to be installed, which presents a significant challenge for vertical space. A large amount of engineering optimization is required to balance the car’s height and body posture. As the entry-level high-end model, ET5 not only has a price tag that pushes the limits, but also showcases the company’s engineering achievements to its fullest extent.
It is said that most people who order ET5 are first-time NIO buyers.
This is a particularly good phenomenon.
On the one hand, ET7, which was developed before ET5, has not yet been delivered. People’s trust in ET5 is largely based on word-of-mouth and brand credibility, which shows that NIO has been solidly fulfilling its technological and production commitments in recent years. Building a healthy trust relationship is beneficial for NIO’s long-term release/delivery rhythm.
On the other hand, it also indicates that an increasing number of ordinary consumers recognize the value of “experience.” What is a good car used to refer only to the product in the past, with other aspects being gimmicks. With NIO’s increasing popularity, the standard of a good car will develop into a composite lifestyle experience, including strongly related energy replenishment and weakly related circle-based socializing, fine consumption, and social responsibility activities. This provides possibilities for sustainable growth of its business model.
The popularity of ET5 is not a single best-seller logic, and the transformation of popular consensus behind it cannot be ignored, at least it is consensus among a growing number of people: NIO is worth it. This is naturally due to NIO’s strategic compass planning and is also the result of years of common demands by users. The hardcore of ET5 is based on building these things.
Becoming Mainstream
By laying a sufficient foundation in spiritual civilization and combining it with highly competent products, NIO will have the opportunity to move towards the ranks of mainstream luxury.
Li Bin said, “We are now about the same size as Tesla in 2017, right before the delivery of the Model 3.” This is a non-trivial analogy. Model 3 turned Tesla from a rich man’s toy factory into a global manufacturing giant.From the perspective of sales potential, NIO also has the opportunity to expand upon its scale. In 2022, NIO will completely open up the sedan market: the ET7 will be delivered at the end of the first quarter, followed closely by the ET5 which will be delivered in the third quarter. Although NIO’s sales this year were all carried by its 668 SUVs and achieved a growth rate of 100%, they did not outperform the overall market. Sedans will bring new growth.
The mid-sized luxury sedan market, in particular the one in which the ET5 is located, achieved a compounded growth rate of 16.1% in the past five years, surpassing the overall luxury car market. It is expected to surpass one million units this year, accounting for 38% of the overall luxury sedan market and exceeding the mid-to -large sedan market, becoming the most mainstream subdivision market of luxury sedans.
Li Bin pointed out that “many cars priced around 200,000 RMB performed very well this year, while there are fewer traditional mainstream high-end market products priced at 300,000 RMB. This is also our huge opportunity. The mainstream (luxury) market in China is about 4 million units, and it would be great if we could capture 20% of it. Mercedes-Benz, BMW, and Audi have all achieved more than 20%, so we still have a lot of opportunities.”
At the same time, NIO also announced its global market plan to enter more than 25 countries and regions by 2025. It will enter Germany, the Netherlands, Denmark, and Sweden first in the coming year.
This will be a comprehensive internationalization effort. The ET5 will also be the flagship for overseas markets. Taking into account the unlimited speed on German highways, balancing stability and wind resistance while the body length is insufficient for guiding airflow, it took three months and six versions just to design the duck tail shape. NIO will also focus on building its service network in Germany next year, not only for transporting and selling cars, but also to replicate the NIO system and value.
The Norwegian market, which was opened up this year, is a small sandbox for a comprehensive self-operated system. It is said that for every four people who take the ES8 test drive, one ultimately makes a purchase, with a very high conversion rate, making Chinese colleagues very envious.
However, the overall challenge is still much greater than small joys. For a Chinese-background company to go to mainstream automotive countries and compete in the mainstream automotive market, it is undoubtedly full of difficulties, but action must still be taken.
“Careful preparation, long-term planning, and maintaining patience.”Over the past year, NIO has been laying the foundation for upgrading its pattern. From the NEOpark capacity expansion, to further channel deployment, to the rapid construction of charging and battery swapping facilities, Li Bin said that they have never expected to hit the jackpot, there is no such thing. But when good things happen one day, you won’t be surprised.
This year’s NIO Day theme is “Hello, World”. Li Bin explained that this is in response to the anxiety and uneasiness that everyone has felt in society and communities over the past year, and it is a friendly greeting to the world.
I think this greeting is powerful, and even a bit fierce. Next year, with two new car models, two new markets, 1,300 battery swapping stations, 6,000 supercharging piles, tens of thousands of destination charging piles, hundreds of stores, and over 100,000 NIO car owners… World, are you ready to welcome the overwhelming “Hello” coming your way?
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.