Nio unveils electric sedan after brush with collapse
Chinese EV startup Nio unveiled an electric sedan called the ET7 this weekend that it promises will have autonomous capabilities and, eventually, a solid-state battery option. It’s a big project that Nio is only able to tackle after pulling off an incredible rebound from the brink in 2020.
Nio will sell a version of the sedan, which is based on a previous concept first shown at the 2019 Shanghai Motor Show, that can go 500 kilometers (about 310 miles) on a full battery for 448,000 yuan (about $69,000) and one that can supposedly eclipse 700 kilometers (about 435 miles) for 506,000 yuan (about $78,000). The first vehicles are slated to be delivered in China in early 2022.
Nio, which is backed by Tencent, will sell a “premier edition” of the ET7 with the larger battery pack as well for 526,000 yuan (roughly $81,000). For those who find those price tags a bit rich, Nio will sell each variant as part of what the company refers to as its “battery as a service” program, where owners pay a per-month fee over a base cost of 378,000 yuan (about $58,000). The higher the range they choose, the higher the monthly fee.
Inside the ET7, a 12.8-inch OLED display pops out from the center of the dashboard, powered by the newest automotive-rated version of Qualcomm’s Snapdragon processor. A digital instrument cluster sits behind the steering wheel, and Nio’s little ball-shaped AI robot, Nomi, is perched on top of the dashboard. The ET7 is powered by a 180kW electric motor up front and a 300 kW motor in the rear, which combine to make more than 600 horsepower.
Nio is also developing a solid-state battery pack that it says can push the range over 1,000 kilometers, or about 621 miles. (It should be noted that Nio is using the far more optimistic NEDC standard, meaning real-world range might not live up to these claims.) That pack will become available in late 2022, Nio says, and will be compatible with the company’s three existing SUVs as well, should customers want to swap in a much longer-range option.
Nio spent a good portion of its annual “Nio Day” event this past weekend showing off the ET7, which is studded with smarts that power what the company is calling “point-to-point autonomous driving” — a big step up from the Tesla Autopilot-style driver assistance package Nio currently includes on its SUVs. The ET7 has 33 sensors integrated into the body, including 12 ultrasonic sensors, 11 8-megapixel cameras, five millimeter-wave radars, two positioning units, and an “ultra long-range high-resolution LIDAR” on the roof.
That Nio finally felt ready to show off the ET7 (and, frankly, that Nio Day was even held) is evidence of the startup’s remarkable recovery from the brink. Nio started delivering its first vehicle, the ES8 SUV, in mid-2018 before becoming a publicly traded company on the New York Stock Exchange. But it spent 2019 dealing with crisis after crisis. It got hit with a one-two economic punch when China reduced subsidies on expensive electric vehicles ahead of a pre-pandemic economic slowdown. Then the company had to recall thousands of ES8s due to a fire risk in the battery packs. It canceled plans for its own factory, sold its Formula E electric racing team, and delayed the sedan project.
Add in five years of unchecked growth (by Nio’s own admission), and Nio finished 2019 in a bad place. Despite starting production on a second, more affordable SUV (the ES6), Nio was still losing money faster than it was bringing it in, and it had less than $300 million in the bank to start the final quarter of the year — and this was all before the coronavirus pandemic.
Nio began 2020 by warning its investors that it didn’t have enough cash to make it through the year. Then, in February, it inked a bailout deal with a group of state-owned or state-adjacent entities worth more than $1 billion. In exchange, Nio agreed to open up a second headquarters in a new province. It also gave the investor group a sizable chunk of a new subsidiary that Nio transferred its “core business and assets” to — plus the group “voting rights with respect to various significant corporate matters” like changes to the subsidiary’s corporate structure and its “core business and … articles of association.”
In subsequent filings with the Securities and Exchange Commission, Nio admitted that assigning such rights “may significantly limit [its] ability to make certain major corporate decisions with regard to” the new subsidiary, simply called Nio China.
While it will take years to truly understand the long-term implications of that deal, it has saved Nio in the short term. Nio had a record 2020 despite the economic slowdown brought on by the pandemic in the first half of the year. It started rolling out a revamped version of the ES8 SUV that rejuvenated sales, and it released a third, even smaller SUV called the EC6 that is already selling better than the other two models. Nio finished the year having delivered 43,728 vehicles, including 17,353 in the fourth quarter of 2020 alone — half of what it delivered in all of 2019.
This resurrection was fortunately timed, too, as electric vehicle stocks soared in the second half of 2020, fueled by the astronomical rise of Tesla’s valuation and the boom of reverse-mergers that brought billions of dollars of new money into the space. Nio’s stock price now sits at nearly $60 per share after languishing in the single digits since its 2018 debut on the NYSE. The company took full advantage of this newfound interest, too, raising $3 billion in a new offering near the end of the year.
In many ways, the new sedan is an emblem of those accomplishments. It’s laden with the best technology that Nio has developed or sourced during its short history. It’s a project that was pulled back off the shelf only because the startup can once again burn through resources without causing an existential crisis. It’s a nod to the company’s future, too, with Nio promising that a solid-state battery option is on the way. And it helps round out Nio’s lineup in an increasingly competitive market, one that’s not only full of well-funded startups, but now features major tech conglomerates like Alibaba and Baidu.