Chinese electric vehicle maker Nio has staked out a contrasting position on pricing to its domestic rival, Li Auto, with a top executive suggesting that carmakers must prioritise profitability as material costs climb.
Nio senior vice-president Ji Huaqiang, in charge of manufacturing, logistics and operations, told reporters on Tuesday that perennially operating at a loss would be detrimental for any carmaker, even in the pursuit of market share.
“The recent spike in raw material prices has had a severe impact on auto assemblers,” Ji said during a media briefing. “Some players have turned out to be reasonable, as they planned to raise car prices to cope with the cost issue.”
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Ji’s remarks came one day after Li Auto slashed the presale price of its new L9 sport-utility vehicle (SUV) by about 10 per cent, only to see its Hong Kong-listed shares plunge 14.2 per cent on Monday. They slid a further 4.3 per cent on Tuesday to close at HK$62.10 (US$7.92).
Nio is set to start selling its full-size pure electric ES9 SUV at the end of this month, with a price tag of 528,000 yuan (US$77,600). That is about 3.6 per cent higher than the discounted Li Auto L9 at 509,800 yuan.
While the two models compete directly, analysts note that budget-conscious Chinese consumers are increasingly favouring lower-priced options amid concerns about the economic outlook and wages.
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