JAC

Nio said it will acquire the manufacturing equipment and assets of the F1 and F2 plants from JAC for a total consideration of about RMB 3.16 billion.

China has imposed restrictions on car production over the past decade amid concerns about overcapacity. Nio had previously been producing cars under JAC's qualification.

As JAC's deal to sell its factory assets comes to a deadline, rumors that Nio will buy them and announce its own car-making qualifications are circulating widely on Chinese social media.

The two will build luxury smart connected EVs based on Huawei's smart car solutions, with product development under the overall responsibility of JAC.

After Changan, Geely, JAC may also join Nio's battery swap system, local media said.

Nio acquired Leopard in a government-coordinated buyout to qualify for vehicle production, and potential further acquisitions of two of JAC's plants will allow it to end its history of contract manufacturing, local media said.

Nio pays JAC for each vehicle produced on a per-vehicle basis monthly. It paid JAC an average of about $1,260 per vehicle in 2022.

JAC plans to sell the assets of two factories that make vehicles for Nio, which the latter may acquire and seek independent EV production qualification, local media said.

JAC's major customer Nio's shipments in the second half of 2023 are expected to grow by about 100 percent from the first half, which will be a key growth driver for JAC in the second half of the year, Kuo said.

Huawei and JAC will jointly build models targeting the ultra-high-end luxury pure electric vehicle market with a price range of around RMB 800,000-1 million, according to local media.