Chinese electric car maker Nio says the lack of chips will slow car shipments
Nio plans to begin delivering its ET7 electric sedan from 2022.
Evelyn Cheng | CNBC
BEIJING – Chinese electric car startup Nio said on Friday it assumed a global chip shortage would affect vehicle deliveries in the second quarter.
A fire in March at a Japanese chip factory owned by Renesas exacerbated an existing semiconductor shortage that forced major automakers to cut production.
Without naming the factory, Nios chairman William Li said on a conference call about the outcome that he expected the negative effects of the fire to hit the auto supply chain in mid-May. The industry broadly believes the shortage will reach a tipping point in the third quarter, Li said.
For now, Nio had to stop production for five working days towards the end of March, which will affect vehicle deliveries for April, Li said.
The start-up forecast deliveries of 21,000 to 22,000 vehicles for the second quarter, which corresponds to growth of 5% to 10% compared to the first three months of the year. This is a significant quarter-quarter slowdown from growth of 16% in the first quarter and 42% in the fourth quarter.
Despite the challenges from the supply chain and technological advancement, Li said the company’s first sedan, the ET7, is still on its way to its scheduled launch for customers in the first quarter of 2022.
Nio delivered 20,060 vehicles in the first quarter, most of its US-listed start-up colleagues for electric cars in China. On Friday, Nio said vehicle sales for the reporting period were 7.41 billion yuan ($ 1.13 billion).
However, Elon Musk’s Tesla has steadily increased production in China, generating $ 3 billion in sales for the automaker in the first quarter. China’s share of Tesla’s global sales rose from 21% in 2020 to 29% in the first three months of this year.
Tesla stock has fallen 4% so far this year. Nio’s are down 20%.
Other drivers update their battery plan
Founded in 2014, Nio posted less-than-expected loss per share of 0.23 yuan (4 cents) for the first quarter versus FactSet estimates of 0.68 yuan per share loss.
The vehicle margin, a measure of profitability, rose to 21.2% in the first quarter after 17.2% in the previous quarter. The increase was mainly due to consumers buying Nio’s driver assistance software and switching to a more expensive battery subscription, management said.
The 100-kilowatt-hour battery power plan costs 1,480 yuan ($ 228) per month, up from 980 yuan for the 70-kilowatt-hour plan.
Almost 60% of all Nio users have opted for the Battery-as-a-Service plan since it was launched in August, company president Lihong Qin told CNBC last week on the sidelines of the Shanghai Auto Show.
Nio has also selected a location in Oslo, Norway for its first overseas project, management announced on Friday. The start-up plans to publish further details on May 6th.