China grants Nio independent OEM status

Nio has received certification from the Chinese government as an independent vehicle manufacturer. Until now, the partner JAC produced Nio's electric cars as a contract manufacturer. The new status paves the way for Nio to fully acquire the two factories built jointly with JAC.

Back in October, local media reported that Nio could take over both factories in Anhui operated jointly with JAC and apply for its own production license. However, the prerequisite was that Nio would be allowed to produce cars under its own name.

The background to this is that China has been controlling car production for years by issuing licenses due to concerns about overcapacity. As reported by the news agency Reuters, among others, Nio has now been included in the “Vehicle Manufacturing Enterprise Credit Information Management System” of the Chinese Ministry of Industry and Information Technology – which means that the company is now recognized as an independent vehicle manufacturer.

Previously, Nio vehicles were produced under the name of partner JAC. Together, the two companies operate two plants called F1 and F2 in Hefei. The official address now given by Nio for production corresponds to the location of the F2 factory.

Following Nio’s status, the ownership structure of the two factories could now also change. JAC announced in October that it intended to sell some of its assets in the factories – specifically, it is said to be worth the equivalent of almost 4.5 billion yuan (currently equivalent to 580 million euros). According to the information provided by JAC at the time, the company’s decision “will not affect Nio’s business and production activities”.

Nio already had plans for its own production in the past (at times in Beijing, at times in Shanghai), but these plans were never implemented due to a lack of funds. When the company was in enormous financial difficulties a few years ago, investors from Anhui province stepped in – including a deal for contract manufacturing with JAC, which is also based in Anhui. Since then, all Nios have been manufactured by JAC, and the agreement was extended in 2021 until May 2024.

The F1 site has been manufacturing the brand’s electric cars since 2017. The Neo Park Industrial Park was founded in 2021, where the F2 plant was established. This is where the Nio ET5 is built, which is also offered in Europe.

cnevpost.com, reuters.com