Burning Another 14 Billion? NIO Wants to Become Tesla, But Needs Some Understanding

Recently, despite not yet shaking off the impact of the pandemic, NIO couldn't wait to establish itself in Hefei. According to reports, the framework agreement signed between NIO and Hefei includes a series of favorable policies provided by the Hefei municipal government, such as funding, land acquisition for factory construction, and manufacturing support. The total investment is expected to exceed 10 billion yuan.

This move not only helps NIO overcome its current difficulties but also presents a great opportunity for Hefei. With NIO's establishment, the local automotive industry chain will be enriched, significantly impacting the local economy and attracting other car companies, making it a win-win situation.

Burning Another 14 Billion? NIO Wants to Become Tesla, But Needs Some Understanding

However, some media estimates suggest that even with this series of support, NIO would still need to "burn" 14 billion yuan to achieve breakeven by 2023. which is not seen as a worthwhile deal. Hydrogen Chain has its own views on this matter. Many consumers and media simultaneously praise Tesla and belittle NIO, but it's important to note that Tesla spent over $20 billion on research and development of core new energy technologies over the past decade. Without overseas support, Tesla wouldn't be thriving today. So why is NIO only met with criticism when facing a crisis?

Some media also believe that NIO invests too much in marketing expenses rather than technology research and development. This view is somewhat biased. NIO has applied for numerous patents in recent years and has introduced the battery swapping model. Whether or not it can turn a profit is another matter, but it certainly addresses the problem of long charging times effectively. Don’t these facilities also require funding?

Consider other luxury brands, such as the German Big Three, which spend astronomical amounts on marketing annually. When your brand lacks recognition, building a brand is extremely difficult, especially since NIO targets the high-end market. If comparing NIO to the German Big Three seems unrealistic, look at China's luxury brand Hongqi. Enormous amounts of money and effort were spent to develop the Hongqi L5.

Hydrogen Chain believes that as a domestic brand daring to challenge the high-end market, NIO may have many shortcomings and may have taken many detours, but it deserves understanding, at least not denigration. After all, it is our own Chinese brand.

Disclaimer: This site is not responsible for the content of articles, provided for reader reference only, and the copyright belongs to the original author. If it affects your legitimate rights and interests (content, images, etc.), please contact this site for deletion.