Chinese EV Startup Nio Secures 1.4 Trillion Won Investment from 'Oil Money'

Nio CEO "Will Promote Technological Innovation"
Previously Implemented Bold Move to Cut Vehicle Prices by 30,000 Yuan Uniformly

Nio (Weilai), regarded as the most promising electric vehicle startup in China, has secured an oil money investment worth $1.1 billion (approximately 1.4168 trillion KRW).

According to Chinese economic media Yicai on the 20th, Nio signed a stock acquisition agreement worth $1.1 billion with Abu Dhabi CYVN Holdings on the same day. CYVN Holdings plans to make a strategic investment through the acquisition of both new and existing shares. CYVN Holdings is an investment corporation established with funding from the Abu Dhabi Department of Finance.

[Image source=AP Yonhap News]

Li Bin, Nio’s founder and CEO, stated, "CYVN’s strategic investment reflects Nio’s unique value in the smart electric vehicle industry," adding, "It will further strengthen Nio’s financial structure, accelerate our business growth, and promote technological innovation." He also elaborated, "We look forward to cooperating with CYVN to build long-term competitiveness and expand Nio’s international business in the future."

In the first quarter, Nio’s total revenue was 10.6765 billion yuan, a 7.7% increase compared to the previous year. However, due to intensified price competition in the industry and increased investments, Nio recorded a net loss of 4.7395 billion yuan, a sharp decline of 165.9% compared to last year. Nio’s research and development (R&D) expenditure was 3.0756 billion yuan, up 74.6% year-on-year.

In the first quarter, Nio delivered 31,000 vehicles, a 20.5% increase compared to last year. By model, this included 10,400 premium smart electric sport utility vehicles (SUVs) and 20,600 smart electric cars. For the second quarter of this year, deliveries are expected to range between 23,000 and 25,000 vehicles, a decrease of 0.2% to 8.2% year-on-year. In April and May, a total of 12,800 vehicles were delivered, and deliveries this month are expected to be around 10,000 units. Previously, CEO Li Bin stated, "If monthly sales fall below 10,000 units, I will prepare to find another job."

Nio’s biggest rival, Tesla, sold 382,000 vehicles in China from the beginning of this year through May, a 77% surge compared to the same period last year.

Earlier on the 12th, Nio attracted industry attention by announcing a 30,000 yuan price cut on all new cars. Following this price adjustment, the price of Nio brand finished vehicles entered the 300,000 yuan range for the first time. The base price of the entry-level model ET5 is 298,000 yuan, and if chosen with battery leasing, the price drops to 228,000 yuan. This is similar to the prices of Tesla Model 3 and Feifan F7. However, with the price reduction, Nio decided to discontinue the previously free battery swap service.