(Source: CnEVPost)
Construction of Nio's new factory in Hefei is expected to start soon, so how will the expanded capacity be absorbed in the future? The electric car company seems to be targeting third- and fourth-tier cities in China.
Nio co-founder and president Qin Lihong said the company currently has about 25 percent of its stores in third- and fourth-tier and lower-tier cities, and that percentage is to rise to about 30 percent by the end of 2021, wallstreetcn.com reported Friday.
Nio had 260 offline stores at the end of March and expects to reach 366 by the end of 2021. This means Nio will open about 45 new stores this year outside the most economically developed first- and second-tier cities.
Judging from the layout structure of Nio's offline stores, its task of digesting the second phase of production capacity will be accomplished by opening up markets in third- and fourth-tier cities, said the above report.
Nio seems determined to seize the opportunity brought by the rapid increase in acceptance of electric vehicles.
In March, China's penetration of new energy vehicles, or the share of such models in all new car sales, exceeded 10 percent for the first time. For William Li, founder, chairman, and CEO of Nio, it is certain that this percentage will double within two years.
The current explosion of the pure electric vehicle market has been slower than expected, not only because of the Covid-19, but mainly because people's perception of the new pure electric vehicle has yet to change, according to Li.
While the shift from fuel to electric vehicles is difficult, once consumers accept the shift, they basically won't go back to fuel cars, Li said.
At the beginning of 2020, the number of Nio's offline stores stood at 77. By the end of 2020, Nio had about 200 stores consisting of Nio House and Nio Space in China, according to a plan revealed by Wei Jian, vice president of Nio's user operations, in early 2020.
Ultimately, Nio had 204 stores at the end of 2020. In the first quarter of this year, Nio added 56 offline stores. Nio will open an average of 35 additional stores per quarter in the next three quarters, according to plans previously announced.
Nio is "not opening stores fast enough" and the number of stores in Tier 1 and Tier 2 cities is "okay," according to Qin, as quoted by wallstreetcn.com.
Nio's Power North plan, unveiled at the Shanghai auto show on April 19, appears to be part of this effort.
Under the plan, Nio hopes to have 100 battery swap stations, 120 mobile charging vehicles, 500 supercharging stations, over 2,000 supercharging piles, and over 10,000 destination charging piles in eight northern provinces of China in the next three years.
