An electric SUV from Nio Inc. ES6 at a battery changing station in a parking lot in Shanghai on March 1, 2021.
Qilai Shen | Bloomberg | Getty images
BEIJING – Chinese electric car start-up Nio said on Tuesday that a global shortage of chips will force it to produce fewer cars in the second quarter.
High demand for electronics amid the coronavirus pandemic and the pressure of US-China tensions on the highly specialized semiconductor supply chain have contributed to a backlog in chip production.
Major carmakers have had to cut production as a result, with China-based Nio the last to announce such cuts.
The company had ramped up production capacity to 10,000 vehicles per month in February, up from 7,500 earlier, founder William Li said in a quarterly appeal on Tuesday. But a shortage of chips and batteries means Nio will have to return to the 7,500 level in the second quarter, he said.
Nio predicts strong deliveries
Despite competition from Tesla, Nio stayed ahead of its starting rivals in car sales.
The company delivered 7,225 vehicles in January and 5,578 in February during the week-long Lunar New Year holiday. With a forecast of 20,000 to 25,000 deliveries in the first quarter, Nio expects deliveries to rise to at least 7,197 cars in March.
In contrast, Xpeng said on Tuesday that it delivered 2,223 electric cars last month, while Li Auto expects to deliver less than 4,000 cars per month in the first quarter.
Nio founder Li said pre-orders for the et7 sedan unveiled in January surpassed those of the company’s other models, but declined to share specific numbers. The et7 is Nio’s first non-SUV consumer car and will be delivered next year.
Li added that the company remained on track with plans to enter Europe later this year.
Shares of New York-listed Nio fell 4% during hours of trading after a fourth-quarter profit loss of 0.93 yuan (14 cents) per share. That is greater than the analyst predicted loss of 0.39 yuan per share, according to FactSet.
The company attributed a nearly 33% quarterly increase in net losses – up to 1.39 billion yuan ($ 212.8 million) in the last three months of 2020 – mainly to the US dollar depreciation.
Nio shares were up more than 1,000% last year after the struggling start-up received a capital injection of about $ 1 billion from state-backed investors, and traders piled into the stock alongside a surge in Tesla’s stock.
Looking ahead, Nio expects total sales of 7.38 billion yuan to 7.56 billion yuan in the first quarter, compared to 6.64 billion yuan in the fourth quarter.