NIO will host NIO Day 2021 this Saturday in Suzhou, a neighboring city to Shanghai.
(Image credit: NIO)
NIO will host NIO Day 2021 this Saturday in Shanghai's neighboring city of Suzhou, where it will unveil new models and other important corporate developments.
Deutsche Bank's Edison Yu's team provided their preview in a note sent to investors on Tuesday.
We usually add our own information when quoting such notes, but Yu's preview is so well written that we don't have any more background to add.
Here are the main contents from their note:
NIO is hosting its fifth annual "NIO Day" event in Suzhou (in-person) this coming Saturday, December 18th where it will officially unveil at least one new model, set to enter production in the second half of next year.
This model will be the ET5 midsize sedan and in our view will be NIO's highest volume vehicle thus far with starting price in the low 300,000 RMB ($46,000) range.
Previously, we also expected another major product unveil (i.e., 6th vehicle in line-up) but based on recent social media posts and comments from the company, it would appear this next vehicle may be properly introduced at a different event later on. To be clear though, the company still very much plans to deliver this vehicle in 2H22.
Beyond this, we expect further details on the ET7 ahead of 1Q22 customer deliveries, hybrid solid state battery (4Q22), next-gen autonomous driving capabilities, and Europe market expansion.
ET5 mid-size sedan will be main focus
NIO will unveil its second sedan at NIO Day (fifth overall model) and we expect it to target the mid-size premium segment, similar to the Tesla Model 3, BMW 3 series and Audi A4. The vehicle will be the first one built at NIO's second plant (NEO Park).
We expect pricing to be lowest among all vehicles released thus far starting in the low 300,000 RMB range (vs. ET7's 440,000) and tap into a TAM of ~800k units domestically.
In terms of timing, we expect this model to enter production by end of 3Q22 and forecast just 9k unit deliveries next year, then increasing to 65k in 2023E.
ET7 ready to launch
Set to begin customer deliveries in a few months, NIO also plans to give update on the flagship ET7 sedan.
We suspect the company will provide a range performance boost compared to previously stated 311 miles (using 75 kWh battery pack) and incremental details about the higher level ADAS capabilities of its next-gen NAD system.
In our view, this vehicle should sell very well and the order book could be as high as 50-60k already. We forecast 30k deliveries next year, limited by supply, then doubling to 60k in 2023E. For context, BMW 5-series, Audi A6L, and MB E-class all sell well above 100k units per year in China.
What is next vehicle?
We had initially anticipated NIO unveiling another vehicle at the event but based on recent social media posts and comments from the company, it would appear this next vehicle may be introduced at a different event later on (i.e., could still be teased at NIO Day but public won't get full details).
To be clear though, the company very much expects to deliver this vehicle in 2H22 and appears to be trying to avoid overloading media/customers with too much product news in one setting.
For the sixth model, we continue to believe this will be a luxury van (similar to Toyota Alphard MPV) called the EF9.
Pricing would likely be fairly high, potentially in the 400-500k RMB range, similar to ultra high end trim of Buick GL8 but volume would be relatively low; we estimate just 1k/5k in volume for 2022-23E.
In relation, there has also been speculation NIO could unveil a new SUV called the ES7, either as a separate vehicle or ES6 refresh. Our view is this is less likely because NIO already has 3 SUVs and is planning a small hardware upgrade for them in 1H22 (e.g., infotainment system).
Separately, we think NIO may also be working on a sports coupe that could either be a special trim of the ET5 or a separate vehicle.