NIO’s second brand was exposed. On March 14, Gasgoo learned that the name of NIO’s second brand is Letao Automobile. Judging from the recently exposed pictures, the English name of Ledo Auto is ONVO, the N shape is the brand LOGO, and the rear logo shows that the model is named “Ledo L60″.
It is reported that Li Bin, chairman of NIO, explained the brand connotation of “乐道” to the user group: family happiness, housekeeping, and talking about it.
Public information shows that NIO has previously registered multiple new trademarks including Ledao, Momentum, and Xiangxiang. Among them, Letao’s application date is July 13, 2022, and the applicant is NIO Automotive Technology (Anhui) Co., Ltd. Sales are on the rise?
As the time approaches, specific details of the new brand are gradually emerging.
In a recent earnings call, Li Bin said that NIO’s new brand for the mass consumer market will be released in the second quarter of this year. The first model will be released in the third quarter and large-scale delivery will begin in the fourth quarter.
Li Bin also revealed that the second car under the new brand is an SUV built for large families. It has entered the mold opening stage and will be launched on the market in 2025, while the third car is also under development.
Judging from the existing models, the price of NIO’s second brand models should be between 200,000 and 300,000 yuan.
Li Bin said that this model will directly compete with Tesla Model Y, and the cost will be about 10% lower than Tesla Model Y.
Based on the guide price of the current Tesla Model Y of 258,900-363,900 yuan, the cost of the new model has been reduced by 10%, which means that its starting price is expected to drop to around 230,000 yuan. The starting price of NIO’s lowest-priced model, the ET5, is 298,000 yuan, which means that the new model’s high-end models should be less than 300,000 yuan.
In order to differentiate from the high-end positioning of the NIO brand, the new brand will establish independent marketing channels. Li Bin said that the new brand will use a separate sales network, but the after-sales service will use some of the existing after-sales systems of the NIO brand. ”The company’s goal in 2024 is to build an offline network of no less than 200 stores for new brands.”
In terms of battery swapping, the new brand’s models will also support battery swapping technology, which is one of NIO’s core competitiveness. NIO stated that the company will have two sets of power swap networks, namely NIO’s dedicated network and shared power swap network. Among them, new brand models will use a shared power swap network.
According to the industry, new brands with relatively affordable prices will be the key to whether Weilai can reverse its decline this year.
On March 5, NIO announced its full-year financial report for 2023. Annual revenue and sales increased year-on-year, and losses further expanded.
The financial report shows that for the whole of 2023, NIO achieved total revenue of 55.62 billion yuan, a year-on-year increase of 12.9%; the full-year net loss further expanded by 43.5% to 20.72 billion yuan.
Currently, in terms of cash reserves, thanks to two rounds of strategic investments totaling US$3.3 billion by foreign investment institutions in the second half of last year, NIO’s cash reserves rose to 57.3 billion yuan by the end of 2023. Judging from the current losses, Weilai still has a three-year safety period.
“At the capital market level, NIO is favored by internationally renowned capital, which has greatly increased NIO’s cash reserves and has sufficient funds to prepare for the 2025 ‘finals’.” NIO said.
R&D investment is the bulk of NIO’s losses, and it has a trend of increasing year by year. In 2020 and 2021, NIO’s R&D investment was 2.5 billion yuan and 4.6 billion yuan respectively, but the subsequent growth increased rapidly, with 10.8 billion invested in 2022 yuan, a year-on-year increase of over 134%, and R&D investment in 2023 will increase by 23.9% to 13.43 billion yuan.
However, in order to improve competitiveness, NIO will still not reduce its investment. Li Bin said, “In the future, the company will continue to maintain an R&D investment of about 3 billion yuan per quarter.”
For new energy vehicle companies, high R&D is not a bad thing, but NIO’s low input-output ratio is the key reason why the industry doubts it.
Data shows that NIO will deliver 160,000 vehicles in 2023, an increase of 30.7% from 2022. In January this year, NIO delivered 10,100 vehicles and 8,132 vehicles in February. Sales volume is still NIO’s bottleneck. Although various promotional methods were adopted last year to boost delivery volume in the short term, from a full-year perspective, NIO still failed to meet its annual sales target.
For comparison, Ideal’s R&D investment in 2023 will be 1.059 million yuan, net profit will be 11.8 billion yuan, and annual sales will be 376,000 vehicles.
However, during the conference call, Li Bin was very optimistic about NIO’s sales this year and was confident that it would return to the monthly sales level of 20,000 vehicles.
And if we want to return to the level of 20,000 vehicles, the second brand is crucial.
Li Bin said that the NIO brand will still pay more attention to gross profit margin and will not use price wars in exchange for sales volume; while the second brand will pursue sales volume rather than gross profit margin, especially in the new era. At the beginning, the priority of quantity will definitely be higher. I believe that this combination is also a better strategy for the company’s long-term operation.
In addition, Li Bin also revealed that next year NIO will launch a new brand with a price of only hundreds of thousands of yuan, and NIO’s products will have wider market coverage.
In 2024, as the wave of price cuts strikes again, competition in the automobile market will become increasingly fierce. The industry predicts that the auto market will face a major reshuffle this year and next. Unprofitable new auto companies such as Nio and Xpeng must not make any mistakes if they want to get out of trouble. Judging from cash reserves and brand planning, Weilai is also fully prepared and is just waiting for a battle.
Post time: Mar-19-2024