Petrol car owners who buy a new vehicle through trade-in will receive up to RMB 15,000 in option funds, RMB 6,498 worth of Nio Phone discount coupons.

(Image credit: CnEVPost)

Nio (NYSE: NIO) today announced the launch of a trade-in subsidy to entice owners of traditional gasoline vehicles to buy its models, a move that differs from its previous practice of doing little marketing for purchase incentives.

In response to China's consumer product trade-in initiative, Nio is offering up to RMB 1 billion yuan ($140 million) in gasoline vehicle trade-in subsidies for 2024 Nio models, the company announced today.

Starting April 1, gasoline car owners who purchase a new Nio vehicle through trade-in will receive an additional RMB 10,000 in option fund subsidies, it said in a statement.

When added to other perks, customers will receive a total of up to RMB 15,000 in option fund, discount coupons for Nio Phone worth RMB 6,498, it said.

They will also receive 36 vouchers worth about RMB 3,600 for free battery swap services and one year's access to assisted driving software Navigate on Pilot Plus (NOP+) valued at RMB 4,560.

Nio has previously been offering benefits including a free Nio Phone, free battery swap vouchers, and a free NOP+ experience.

However, the company has rarely publicly marketed these entitlements, resulting in many potential customers not being aware of these promotions, possibly for fear of negatively impacting its premium brand image.

Regarding the free Nio Phone, the move only gained widespread attention after it was reported in the local media in the middle of last month.

The company released the first-generation Nio Phone on September 21, 2023, and currently offers three variants starting at RMB 6,499, RMB 6,899, and RMB 7,499 respectively.

On March 17, Nio founder, chairman, and CEO William Li said in a user communication that the second-generation Nio Phone has completed development and has entered the manufacturing phase.

Nio's latest move signals that the quest for sales may begin to take a higher priority. Nio and its major local counterparts are expected to announce March delivery figures today.

On March 27, Nio revised its guidance for deliveries in the first quarter to around 30,000 vehicles, down 3.23 percent to 9.09 percent from the previous 31,000 to 33,000 units.

The lowered guidance means that the company expects March deliveries to come in at about 11,813 vehicles, considering that it delivered 10,055 vehicles in January and 8,132 vehicles in February.

One interesting thing to note is that despite the ongoing price war in China's EV industry, (NASDAQ: TSLA) instead increased the prices of all three variants of its Model Y SUV by RMB 5,000 earlier today.

($1 = RMB 7.2213)

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