Nio still expects to report its first profitable quarter in Q4 despite lowering the vehicle delivery guidance by 20,000—25,000 units, the company’s founder and CEO William Li said on Tuesday.
In June, when reporting its first quarter earnings results, the management said it expected to deliver 25,000 units per month for each Nio and Onvo brands in the final quarter of 2025 — while not disclosing any sales guidance for the Firefly brand.
However, three months later, Li said the 150,000 target was now including all three brands.
On Tuesday, the company trimmed the total target of the three brands from 150,000 to a range of 120,000 and 125,000 units.
Speaking at the earnings conference call, the chief executive of the Chinese EV maker was asked by the Morgan Stanley analyst Tim Hsiao asked the CEO about the impact of the sales target reduction and the 50,000 monthly sales rate.
“Actually, for the company, we still have confidence in achieving quarterly breaking even in Q4,” the CEO stated. “And this is still our financial target towards the end of the year.”
Li said the phase out of the trade-in policy in China will not allow the sales spike seen by Nio, but also across all industry in the final months of each year.
“But in the meantime, we did see the impact coming from the phase out and the termination of the trade in. And replacement subsidies since the middle of October,” the CEO said.
Last December, amid the year end sales push and the production ramp up of the Onvo vehicles, Nio reached a new monthly record, crossing the 30,000 threshold for the first time.
“But this is actually the challenge faced by the entire industry in that case, in Q4, for the entire industry,” he added. “We may not see the year end sales spike that we normally expect towards the end of the year.”
Li reminded that, starting from January 1, “the purchase tax exemptions on the new energy vehicles will be further reduced for the new products like the ES8.”
However, the CEO defended that the order backlog for the three-row SUV “will continue towards the next year.”
“Car companies, including Nio, provide the guarantee for the purchasing tax exemptions to users waiting for their cars next year,” Li stated referring to the September announcement where the company told buyers of the ES8 that it would cover the subsidy impact if they could not receive the car before the year end.
“Yet no car company is going to provide the guarantee for the trade in and replacement subsidy,” he warned. “In that case, the overall market demand has been affected because of the cancellation of the trade in subsidy, especially for our company.”
Concluding his answer, Li reaffirmed that the profitability target remains on the table.
“Yet the overall impact on the gross profit is limited,” he stated. “In that case, we do have the confidence for the financial target.”
