China Specialist, Auto and Industrial Specialist

Victoria Li

20 years experience as sell side analyst focusing on China's Industrial and Auto sectors

NIO: Will It Survive the Fight with Tesla?

Equity Bottom-Up

NIO remained its No.1 position in local emerging EV brand YTD by delivering 41,956 cars. ES6 is the best seller with 46% volume contribution. It appears that Tesla's Model Y hasn't had any obvious negative impact yet as we worried before.However, we still concerned on NIO's outlook because:1) Xpeng P7 (sedan) overtook NIO ES6 (SUV) became best seller model among local emerging EV brands' product pool.2) Increasing acceptance on smart EVs and increasing sales contribution from younger generations would reduce market share upside on NIO's ES6 and EC6  if NIO has no improvement on autonomous driving and other smart EV functions. 3) Model Y launched standard range version on 8th July, which takes down the entry level price to Rmb276k, vs. ES6's 348k.  It might divert NIO's client base.

NIO remained its No.1 position in local emerging EV brand YTD by delivering 41,956 cars. ES6 is the best seller with 46% volume contribution. It appears that Tesla's Model Y hasn't had any obvious negative impact yet as we worried before.However, we still concerned on NIO's outlook because:1) Xpeng P7 (sedan) overtook NIO ES6 (SUV) became best seller model among local emerging EV brands' product pool.2) Increasing acceptance on smart EVs and increasing sales contribution from younger generations would reduce market share upside on NIO's ES6 and EC6  if NIO has no improvement on autonomous driving and other smart EV functions. 3) Model Y launched standard range version on 8th July, which takes down the entry level price to Rmb276k, vs. ES6's 348k.  It might divert NIO's client base.

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