Nio delays plans for proprietary battery plant
Nio postpones producing its own electric car batteries due to market developments. According to local media, the Chinese startup has set back equipment purchases for its battery factory. Nio says plans for the plant have not been cancelled but rescheduled.
“Based on business needs, we have postponed the mass production of batteries,” a Nio spokesperson told 36kr. “The program is progressing normally according to the new mass production schedule.” Nio has yet to disclose said schedule. Initially, the company wanted to start manufacturing in-house developed batteries in China next year.
Adding today’s statements, Nio appears more cautious about investing in new projects given the relatively low sales of its electric cars. “The project definitely needs to be delayed – how many cars have only been sold? No sensible person would have invested in these immediately,” said a source close to the startup. Nio delivered 31,041 vehicles between January and March and since reduced prices for all models in China. This June looked better and put Nio in sixth position in NEV sales by recording a five-digit sales figure again for the first time (10,707 BEVs). Still, the company remains far behind China’s top dogs, BYD (253,046 NEVs) and Tesla (93,680 BEVs).
On a positive note, insiders close to the company also mentioned falling lithium prices so that purchasing batteries is no longer a problem threatening the company’s existence.
Nio had confirmed in June last year that it would start producing its own battery packs in 2024 and that it would manufacture battery cells in-house in the long term. According to media reports, Nio is already working on 4680-format battery cells as well as lower-cost lithium manganese iron phosphate (LMFP) cells and plans to mass-produce these for use in Nio-branded electric cars and a new brand codenamed ALPS.
In February, Reuters reported Nio planned to build its first battery factory to produce large round cells with an annual capacity of 40 GWh next to its main production centre in Hefei in eastern China’s Anhui province to reduce dependence on its main cell supplier CATL. Nio’s 75- and 100-kWh packs use CATL cells.
In the latest development, Nio has begun sourcing semi-solid-state cells for the new 150 kWh pack from WeLion, as reported. Nio wants to deliver electric cars utilising the new batteries this month, later than planned. William Li, the company’s chairman and CEO, confirmed as much when unveiling the ES6, also mentioning a range of 930 kilometres according to China’s NEDC standard.
Nio models are now designed to be compatible with its battery swap technology so that customers may choose another pack during the vehicle’s life; previously, only batteries of the same type could be exchanged. Nio announced in December 2021 that battery packs could be upgraded monthly if required. Currently, there are packs with 75 or 100 kWh.
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