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NIO – ONVO announces launch on May 15th
On May 9th, at the NIO’s second factory in the New Bridge Intelligent Electric Vehicle Industrial Park in Hefei, Anhui, NIO held the off-line event of the 500,000th vehicle represented by ES8.
At the same time, during the event, Li Bin announced that the NIO’s second brand “ONVO” will be launched on May 15th, the International Family Day, to accelerate the off-line process of NIO’s 1 millionth vehicle.
In the high-end pure electric field of more than 300,000, NIO has produced 500,000 vehicles, which is not an easy task – in this process, NIO has experienced many rhythm fluctuations and adjustments.
On May 27, 2018, three and a half years after its establishment, NIO’s first mass-produced vehicle was off the line in Hefei, Anhui. This mass-produced vehicle was the first generation NIO ES8 model. In the next two to three years, NIO subsequently released the first-generation ES6 and EC6 models and achieved mass production delivery.Until April 7, 2021, at the JAC-NIO Advanced Manufacturing Centre in Hefei, Anhui, NIO welcomed the production of its 100,000th vehicle. This milestone was achieved approximately three years or 1,046 days after the production of NIO’s first vehicle.
At that time, NIO’s available models were the ‘866’ series, which were based on the NT 1.0 platform. The first purely electric sedan from NIO, the ET7, had been officially released in January of the same year but had not yet entered mass production.
In reality, NIO did not deliver any new releases to its customers throughout the entirety of 2021. However, Li Bin, during a review, noted that 2021 was a year during which NIO ‘lived relatively comfortably’, as the company enjoyed high-profit margins, minimal losses, and a positive cash flow.
On April 26, 2022, a year later, a Polar Star Blue NIO ET7 rolled off the production line at the JAC-NIO Advanced Manufacturing Centre, marking the production of NIO’s 200,000th vehicle. This achievement made NIO the first company amongst the new generation of domestic vehicle manufacturers to have produced 200,000 vehicles.
Merely seven months later, on December 12, 2022, the 300,000th NIO vehicle was produced at NIO’s second manufacturing base. The rise in sales of the new models ET7, ES7, and ET5, which were all based on the NT2.0 platform, contributed to this accomplishment.
By September 8, 2023, NIO had produced its 400,000th vehicle, and had essentially completed the launch of the second generation of its seven models. The final model based on the NT2.0 platform, the brand-new NIO EC6, was released seven days later on September 15.
Nonetheless, when reviewing the company’s performance in 2022 and 2023, Li Bin expressed that NIO’s performance was not satisfactory.
The first and second models based on the NT2.0 platform, the NIO ET7, and ET5 had the potential to ‘soar’, but were severely affected by the pandemic. The ET5, in particular, was hit hardest. Despite receiving 100,000 orders, its factory had to shut down. The increase in the cost of batteries led to an increase in the cost of individual vehicles by three to four ten thousand yuan.
Therefore, Li Bin admitted that NIO had struggled to maintain a steady rhythm over the previous two years.
Nevertheless, starting in the second half of 2023, NIO began to adjust its rhythm. Li Bin stated that one of the key aspects was an enhancement in sales capabilities. By March of this year and with the support of the BaaS policy alongside the release of the 2024 models, NIO has now fallen into a good rhythm, making this year a good one in terms of rhythm.
With such a rhythm, NIO’s sales performance in recent months has been steady. Supported by this performance, the 500,000th NIO vehicle was finally completed on May 9, 2024, after the complete switch to the 2024 versions of all eight models based on the NT2.0 platform.When summing up this process, Li Bin stated, “If you were to think of this like a marathon, ask yourself, what’s the most comfortable and rewarding segment? It’s truly a victory of rhythm.”
For NIO, as an automobile company, 500,000 units is undoubtedly a milestone worth celebrating. However, while celebrating, NIO has already shifted its focus onto its second brand, ONVO, for the rest of the year.
In fact, before this event, a lot of information about the ONVO brand had already circulated online and received official confirmation or response; ONVO’s official website has also gone live, previewing their first model, the ONVO L60. The news that the ONVO brand will debut in May is already widely known.
At this event, one of the key pieces of information that Li Bin attempted to announce was that the ONVO brand would officially launch on International Family Day, May 15. Choosing to make the announcement on International Family Day underscores and emphasizes ONVO’s brand positioning for the family user.
It’s worth mentioning that during the media communication part of the event, apart from Li Bin and Qin Lihong, the president of the ONVO brand, Ai Tiecheng, also made an appearance and shared some key points about the ONVO brand.
As for Ai Tiecheng joining NIO, based on what Li Bin shared, given the positioning of ONVO as a brand for families, they needed a person who could deeply understand the detailed needs of family users. Prior to joining NIO, Ai Tiecheng had been the man behind Shanghai Disney Resort and has a strong understanding of creating joyful family atmospheres.
Therefore, upon Li Bin’s invitation, Ai Tiecheng joined NIO. In response to this, Ai Tiecheng, stated that he had actually been in contact with NIO since 2015, and was even the 107th car owner of NIO. Because of this, he has a strong understanding of NIO’s users, brand, culture, and experience; and in 2020, accepted Li Bin’s invitation to join NIO to lead the second brand. He has been with NIO for nearly four years now.
He stated that he will make an appearance at the ONVO launch event on May 15.
As for the much anticipated ONVO’s first model, the L60’s energy consumption, Li Bin emphasized that it is very different from the models under the NIO brand. ONVO has a strong focus on energy consumption which is vital because family cars need to be efficient; lower energy consumption means saving power cost, reflecting the brand’s “good housekeeping” product philosophy.
Li Bin stressed that the L60’s energy consumption performance has been supported by a considerable amount of technology, such as high-pressure systems, electric drive efficiency, aerodynamic drag coefficient, etc. It is all in the details.
Moreover, Li Bin emphasized that ONVO’s L60 is expected to outperform Tesla in terms of energy consumption.
In terms of how NIO sees the positioning of the ONVO brand internally, Li Bin stated that in the past decade, NIO has essentially completed the process of going from 0 to 1 in terms of product and technology system construction, symbolized by the launch of the NIO ET9. ONVO represents NIO’s journey from 1 to 10, or even 1 to 100, because they aim to reach a wider market through ONVO.Li Bin states that NIO has always strived to be ‘daring to be the first in the world’, including full-stack self-development, charging and swapping systems, and global layout, all of which underpin the essence of a high-end brand.
Discussing the advantages of ONVO, Li Bin explains that ONVO aims at being ‘daring to be last in the world’, meaning, they take mature technologies and services and offer them to a broader audience through a cost-effective model and more reasonable pricing. This isn’t a journey from 0 to 1, instead it naturally integrates the strengths that NIO already possesses, including the charging and service systems established by NIO.
In response, Qin Lihong emphasizes that just after the launch of the ONVO brand, it can enjoy more than 1,000 charging station facilities, an advantage many brands do not have. Therefore, the maturity of their system is beyond what most can imagine – a concept referred to as ‘born mature’.
Quick Comment:
If we look at NIO’s overall development, the 500,000th mass-produced vehicle rolling out signifies both a conclusion and a new beginning.
On the one hand, it can be seen as a periodic summary of NIO’s developments over the past decade.
NIO, aiming at a high-end pure electric strategy backed by full-stack research and a charging system, has managed to deliver nearly 500,000 vehicles in the Chinese car market. This has to some extent raised the price range of China’s domestic brands – especially within the high-end pure electric market that costs over 300k where NIO stands alone.
On the other hand, it also marks the start of NIO’s next phase. This implies that NIO, with the ONVO brand as a fulcrum, will have to leverage its inherent strengths in technology, products, organization, and services to enter a larger market segment with a lower price range but fiercer competition. This also means that NIO will enter a multi-brand development phase, undeniably marking a new beginning.
It’s worth noting that behind the mass production of these 500k vehicles, NIO has invested over 43 billion in R&D over the past decade while consistently operating at a loss. Now, with the advent of the ONVO brand, it’s time for NIO to recover some returns through larger scale market sales.
ZEEKR’s IPO Surges 34.57% on Debut
On May 10, ZEEKR, under the ticker ‘ZK’, was listed on the NYSE, marking its official entry into U.S. stocks.
For this IPO, ZEEKR issued 21 million American depositary shares, each priced at 21 dollars, which is the highest issue price as previously set in the prospectus ranged from 18-21 dollars, ultimately raising $441 million and achieving more than five times of over-subscription. Based on the issue price of 21 dollars, the market cap of ZEEKR is about 5.2 billion dollars.
Notably, ZEEKR’s opening price on debut was 26 dollars, and it closed at 28.26 dollars, a 34.57% increase from the issue price and an 8.7% increase from the opening price. This brings the market cap to approximately 6.898 billion dollars.
With a successful listing on the New York Stock Exchange, ZEEKR has officially become the fourth new force China’s company listed on US stocks, following NIO. It has also become the fastest-skating new energy company ever.
Actually, the listing on the U.S stock market, whether it was NIO or ZEEKR, was the result of riding on the trends. However, the trend that NIO rode was mostly granted by the era, whereas the trend that ZEEKR rode was self-created.
In truth, ZEEKR has always been seeking opportunities to go public.
As well known, ZEEKR can be said to be a brand born in Rome. Backed by Geely, a well-established company, ZEEKR, upon its establishment, bought 100% of the shares of Geely’s Central European Automotive Technology Center for 800 million and acquired 30% of the shares of Haohan Energy for 9 million. It also turned Ningbo Weirui, which focuses on the research and development and manufacturing of batteries and motors, into its own subsidiary.
It is reported that before ZEEKR 001 was listed, much of ZEEKR’s income came from selling batteries and motors to Geely. Even now, selling batteries and motors to brands inside and outside the Geely system is still stimulating ZEEKR’s income growth. For example, in 2023, more than a third of ZEEKR’s revenue comes from the sale of batteries and other non-car sales businesses.
In addition, according to the data disclosed in the prospectus, with the brand’s rapid increase in sales since its establishment, ZEEKR’s revenue has also increased exponentially. From 2021 to 2023, ZEEKR’s annual total revenue was 1.5443 billion, 196.712 billion, and 339.118 billion.
However, there has also been a situation of selling more and losing more with ZEEKR. From 2021 to 2023, ZEEKR’s annual net loss is 45.143 billion, 76.551 billion, and 82.642 billion. By the end of 2023, ZEEKR’s cash and cash equivalents were only 32.607 billion.
In addition, besides the new products currently under development, in order to maintain its competitive advantage, ZEEKR will aggressively push forward with the deployment of large-scale charging stations on one hand, and continue to create intelligent systems, including its independent intelligent car tech R&D, collaborating with Mobileye, and purchasing Nvidia’s DRIVE Thor chips.
This means that ZEEKR needs to spend a lot of money in technology research and development, channel expansion, charging expansion, marketing and promotion, etc. But judging from past data, in 2023, ZEEKR spent as much as 82.642 billion on product research and development alone.
In fact, as early as October 2022, Geely had disclosed plans to list ZEEKR separately. The initial proposed listing venue was not the US stock market, but Hong Kong stocks. However, for a variety of considerations, ZEEKR finally decided to turn to the US stock market.
In November of last year, ZEEKR formally submitted an IPO application to the SEC, planning to list officially on the NYSE under the ticker “ZK”. However, this plan has been temporarily put on hold.
At the time, ZEEKR was not as thriving as it is today, and listing prematurely would have hastened the exposure of its weaknesses. If they had chosen to go public early, the backing of Geely would be the only substantial support for ZEEKR’s capitulative narrative, but the capital market is not one that favours favouritism.
Additionally, apart from planning to resolve their capital issue through going public, ZEEKR conducted two rounds of financing in August 2021 and February 2023 respectively.
The first round of financing amounted to $500 million, invested by Intel Capital, CATL, Bilibili, Grand Commerce Group and Boyu Capital, marking a valuation for ZEEKR around $9 billion following the investment. The second round of financing amounted to $750 million, with investments from Mobileye founder and CEO Amnon Shashua, CATL, Yuexiu Industrial Fund, Tongshang Fund, and Quzhou Xinsafe Intelligence Manufacturing Fund, marking a valuation of approximately $13 billion after investment.
However, in an increasingly crowded market space and intensifying competition, ZEEKR needs a substantial capital backing to maintain its competitive advantage over the long term.
Therefore, for ZEEKR, going public seems to be the optimal solution to its capital issue.
Now with more abundant resources secured through the capital market, ZEEKR is ready to forge ahead. According to official information, the funds raised by ZEEKR through the IPO will be allocated in the following three areas:
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Approximately 45% will be used to develop more advanced electric vehicle technology and expand its product portfolio;
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Approximately 45% will be used for sales and marketing efforts and for expanding its services and charging network;
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About 10% for general corporate purposes (including operational capital needs), in support of ZEEKR’s business operations and development.
In short, with this IPO, ZEEKR has acquired a window of opportunity for its high-quality growth.
Quick Take:
For ZEEKR, the IPO serves as a new starting point. According to its plans, ZEEKR will introduce the ZEEKR MIX and an unrevealed pure electric SUV to the market this year, bringing its total product count up to seven, with these seven models expected to contribute to an annual sales target of 230,000 units.
In addition, to list on the US stock market will be a driving force for ZEEKR’s continuous evolution. After all, this move will put all company-related information and movements under the magnifying glass of the market, demanding higher standards in finance, management, product, and technology areas.
Meanwhile, listing on the US stock market also provides ZEEKR with an excellent opportunity to increase its domestic and international brand exposure. ZEEKR has already entered multiple market regions including Europe, Middle East, and Southeast Asia, and plans to enter the Singapore and Hong Kong and Macau markets by the third quarter of this year. Looking forward, ZEEKR is preparing to enter the US Robotaxi market.
Moreover, ZEEKR’s IPO on US stock market to some extent has unburdened Geely, no longer being a drag on Geely’s financial performance, further serving as Geely’s vanguard and pushing forwards Geely’s transition to clean energy.
Mid-celebration does not suit ZEEKR well. Going forward, ZEEKR should effectually utilize more resources in hand to progressively evolve into a healthier corporate state, thereby winning more chips supporting long-term growth amidst future market competition and industry revolution.
EXEED Star Era ET Global Release
On May 9, the EXEED Star Era ET officially made its debut.
The EXEED Star Era ET encompasses both extended-range and pure electric powertrains, total of 8 versions.
In terms of extended range, the EXEED Star Era ET includes:
- Plus priced at 189,800；
- Pro priced at 205,800；
- Pro+ priced at 225,800。
In terms of pure electric, the EXEED Star Era ET includes:
- Pro priced at 229,800；
- Pro 4WD priced at 239,800；
- Pro Smart Drive priced at 249,800；
- Max priced at 279,800；
- Ultra priced at 319,800。
The extended-range version of the EXEED Star Era ET is equipped with a dedicated engine developed by Chery, that displays higher energy performance with a thermal efficiency that reaches up to 44.5%, compared to the industry average. With a full tank and a full charge, this version provides a maximum overall range of 1518km. The pure-electric version offers a maximum range of 760km, and it can replenish 475km of range in just 11.5 minutes, reflecting the advancements in fast-charging technology.
In terms of safety, the EXEED Star Era ET adopts a comprehensive safety system, including active and passive safety measures along with multiple battery protections. It passed the ‘NESTA Six-Dimensional Electric Safety’ certifications. Worth mentioning is that the model remained intact with no leakage, smoke, or fire from the battery pack, as shown in the drop test from an altitude of 31.9m, highlighting its exceptional safety performance.
In terms of coverage and luxury, the EXEED Star Era ET provides billowy space with its spacious body size, the interior volume reaches up to 3.45 cubic meters, also it has 1.57 square meters of panoramic sunroof. The seats are high quality Nuprima faux matte leather, equipped with high-end features like audio pillows and multi-adjustable electric seats, thereby enhancing the driving experience.
In terms of power performance, the EXEED Star Era ET is equipped with a smart chassis and IAS intelligent air suspension, along with a CDC electromagnetic damping system, providing a stable and comfortable driving experience. The braking system consists of six-piston fixed calipers, achieving a braking distance of 34.8 meters at 100 km/h, also exhibiting exceptional performance in turning radius and fording depth.Technological innovation is another highlight of the Exeed ET. The car, based on the Chery EEA 5.0 electronic and electrical architecture, equipped with 30 sensors and NVIDIA DRIVE ORIN chips, supports advanced intelligent driving and smart cockpit functions, demonstrating the latest advancements in the field of artificial intelligence and autonomous driving.
At the press conference, Yin Tongyue, party secretary and chairman of the board of directors of Chery Holdings, stated: “The Exeed ET, as Chery Group’s first pure electric and extended-range dual-power product to be simultaneously launched worldwide, not only demonstrated extraordinary capabilities at its debut but also received fervent attention during the pre-sale phase. It possesses superior capabilities including safety, intelligence, comfort, and long-range. With the launch of models such as the Exeed ET, I believe our new energy product sales will quickly enter the top three in the industry, fulfilling our promise of last year and being unpretentious in this year’s new energy market.”
From this, it can be seen that the Exeed ET is not only the vanguard of Chery Group’s product line but also undertakes the important mission of leading the upward development of Chery Group’s brand and being popular in the global market.
Quick Review:
The Exeed ET is the most critical product of Chery in recent times, bearing the task of holding up Chery’s sales and influence in the new energy automobile market.
So, regardless of whether it is from the positioning of the Exeed ET, a medium-to-large extended-range family SUV, or its starting price of 189,800, which avoids the brutal competition in the 200,000-300,000 market segment, it can be seen that Chery is going full out in the new energy automobile market to create a sensational explosion product.
The Exeed ET has not disappointed either. According to data revealed by Huang Zhuogan of Exeed Marketing Center on Weibo, as of noon on May 11th, the orders for the Exeed ET have exceeded 26,000.
Of course, whether the Exeed ET can uphold Chery’s sales and resonance in the new energy market still relies on its ability to stably deliver after the Exeed ET. At the same time, as the new energy car market continues to have more competitive products, the Exeed ET still needs to remain alert and ready for fierce competition at any time.
This article is a translation by AI of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.