Written by Cláudio Afonso | LinkedIn | X
China’s bank BOCOM International has released a new research report on Tuesday maintaining a positive outlook on the Shanghai-based Nio, despite the company’s weaker-than-expected first quarter performance.
The bank remains confident in Nio’s future, citing robust a second quarter guidance as the electric vehicle maker forecasts deliveries between 54,000 and 56,000 vehicles, reflecting a year-on-year increase of 129.6 percent to 138.1 percent.
The bank’s analysts believe that the improvement in sales volume in the second quarter will help Nio’s vehicle gross margin return to double digits due to economies of scale.
BOCOM predicts Onvo’s steady-state monthly sales volume to reach 9,000 to 10,000 units by 2025 adding that it will be crucial for Nio’s next growth phase thanks to the competitive price unveiled on May 15.
The pre-sale price of its first model, a mid-size family SUV, starts at 219,900 RMB, which is 30,000 RMB lower than the Tesla Model Y. Customers can currently deduct 6,000 RMB off the vehicle price by placing a 2,000 RMB deposit, while deliveries start in the third quarter of the year.
The firm has maintained its Buy rating for the EV maker with a target price of HKD 59.88/ $7.70.
Alan Ai, senior vice-president of Nio and president of its sub-brand Onvo, has recently announced that the brand is developing six-seat and seven-seat models aimed at larger families.
Ai highlighted that the space capacity of the second model will rival that of an MPV, with a road test prototype set to be unveiled soon.
Regarding the naming of the L60, Onvo‘s first model launched on May 15, Ai explained that it is not derived from the battery capacity of an entry-level model but rather based on the brand’s initial letter in China, where it is called “Ledao”.
Nio‘s Founder and CEO, William Li, recently indicated that Onvo will directly compete with Li Auto, a Chinese hybrid manufacturer set to launch its second fully electric model in the first half of next year.
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In a recent interview with Yicai, Li noted the overlap in pricing between Onvo and Li Auto‘s offerings, suggesting an inevitable rivalry. Both brands have consistently targeted the family market since their inception.
“Both Onvo and Beijing-based Li Auto target the personal use auto market and their prices overlap. I believe there will definitely be competition between the pair,” said William Li.
Li highlighted Nio‘s strategic focus on targeting both mass mainstream and premium markets.
“This approach will capitalize on Nio’s strengths in systematization, generate efficiency gains from early-stage R&D and infrastructure investments, and drive economies of scale,” the chief executive said.
Li Auto’s upcoming electric crossover, its second fully electric model, has been spotted in China over the last months and it is rumored that will utilize 800V architecture while supporting 5C charging.
Written by Cláudio Afonso | LinkedIn | X
