NIO says its two joint ventures need to make their own way and it is just an investor
For GAC NIO and Changan NIO, NIO is just an investor, NIO co-founder Qin Lihong said recently in reference to the two joint ventures.
He was quoted by Eeo.com.cn as saying that NIO is involved in some of the work of GAC NIO's board of directors, while it is less involved in Changan NIO's operations. "We will try to help them (GAC NIO and Changan NIO), but it's definitely not as simple as money."
GAC NIO and Changan NIO are joint ventures that NIO formed two years ago with Guangzhou Automobile Group and Changan Automobile respectively, which were considered at the time to have set a precedent for joint ventures between emerging and traditional car companies in China.
But with NIO in deep financial trouble, the progress of these two joint ventures has been relatively slow. In the first half of this year, NIO's sales and share price rose sharply after it received a capital injection from the Anhui government, and the funding problem was resolved.
Qin said NIO now has 40 billion yuan in cash on hand. Asked whether NIO has any new capital injection plan for the two joint ventures, Qin Lihong did not reply directly.
He said, "We had some financial challenges last year, but the money in this area (investment in joint ventures) is normal, and their (GAC NIO and Changan NIO) development may not be as simple as a money issue."
"We will always bless and help them (Changan NIO and GAC NIO), but their path needs to be found on their own," he said, adding that NIO, as one of the parent companies, is not involved in the day-to-day operations of the two joint ventures.
In the past two years, the two joint ventures have not progressed well.
Changan NIO has been in a preparatory phase for two years and has not launched any products so far.
In addition to the slow progress of the products, a more critical signal is that NIO's equity stake in Changan NIO has been sharply reduced from 50% to 4.62%, while Changan's stake has increased to 95.38%. This is interpreted as NIO's plan to exit Changan NIO.
With Changan NIO's future uncertain, Changan has recently announced that it will work with Huawei and CATL to build a high-end new energy brand, and Tencent is also reportedly likely to take a stake.
Since December, Changan NIO has released a number of job postings, and some of the hires have been asked to have experience with luxury brands.
GAC NIO has lowered its sales target to 5,000 units this year, GAC NIO has lowered its sales target to 5,000 units this year, but even so, by the end of September this year, the cumulative sales of the HYCAN 007 were only 562 units.
Two years after its establishment, GAC NIO's financing progress is still stuck in the angel round, and funding has become a major problem in GAC NIO's development.
Previous media reports said that GAC NIO executives, including GAC NIO founder and CEO Liao Bing, had repeatedly contacted local governments to seek financing, including Zhejiang and Henan.
The latest news shows that GAC NIO may get investment from the Beijing government, and if the negotiation process goes well, GAC NIO headquarters may be relocated to Beijing.