Li Bin, founder and CEO of electric car maker NIO, said on October 8 that it will only offer rental services when launching its cars in four European markets this year. Li Bin believes that flexibility will be a key selling point as more people turn to electric vehicles. Depending on the length of the subscription, users can rent an electric car with a 75-gigawatt-hour battery pack for between 1,199 and 1,295 euros (about 8,308 yuan to 8,974 yuan) per month. The minimum subscription period is one month.
NIO has previously allowed customers to rent batteries rather than buy them. The battery is currently the most expensive component of an electric vehicle. At the same time, instead of charging the car at home, NIO owners can drive the car to a battery replacement station and replace it with a new battery pack in minutes to save time. Now, as NIO prepares to launch operations in European countries such as Germany, the Netherlands, Sweden and Denmark, the company plans to operate there on a corporate lease and subscription model. NIO will offer three domestic models, the ET7, ET5, and ES7, the latter being renamed the EL7 in Europe due to a brand dispute with Volkswagen's Audi.
In an interview at NIO's new showroom in central Berlin, Li Bin said: "We will not sell cars directly, and flexibility will become a new premium factor. Since production started in 2018, NIO has sold close to 250,000 vehicles in China and Norway, priced at around 50,000 to 70,000 euros (about 346,000 to 478,000 yuan), depending on the car's range And whether customers buy or lease batteries.
So far, NIO has been building cars to order, customizing products for customers, and keeping inventories low. Li Bin said NIO would stick to its strategy of selling cars directly in existing foreign markets, in part because Norway levies higher taxes on subscription models. NIO faces growing competition in China from electric vehicle startups such as Xiaopeng, Hezhong, and Leapmotor. At the same time, NIO is also facing a squeeze from bigger automakers, such as China's BYD and the United States' Tesla. In Europe, NIO will follow in the footsteps of Tesla and Volkswagen to gain a higher share of the electric vehicle market.
Li Bin said NIO plans to install at least 120 battery replacement stations in Europe by the end of next year. Last month, the company opened its first factory in Hungary to make battery replacement stations and will consider producing batteries in the region once battery sales in Europe reach about 10-gigawatt hours.
Li Bin said: "The advantage of separating the car from the battery is that we can achieve economies of scale for the battery faster than the car. When we reach 10-gigawatt hours, we will consider localized production ."
In China, NIO has already achieved this goal. A team of about 700 people is producing the batteries in-house, allowing the company to control its battery supply. At the same time, NIO is looking for more partners than CATL and hopes to establish more partnerships in the next year.
Li Bin added: "In the long run, we believe that any top company in the automotive industry will soon produce its own batteries."
NIO's second-quarter revenue rose 22% from a year earlier, but its net loss rose to $410 million, more than quadrupling the same period a year earlier. NIO delivered less than 32,000 vehicles in September, up 29.3% year-on-year. Li Bin said China's supply chain problems eased faster than expected.