Chinese electric car start-up Nio will reduce its monthly vehicle production capacity by 25% in the second quarter due to a shortage in semiconductors and batteries, according to a report.
- Founder William Li in a quarterly earnings call said shortage in chips and batteries will push Nio to reduce production to 7,500 in the second quarter after rising to 10,000 in February.
- Production is expected to recover in July to bring annual production capacity to 150,000 under one work shift with the potential to double by early 2022 to 300,000 units yearly under two shifts.
- Li forecasts 20,000 to 25,000 deliveries in the first quarter including at least 7,197 in March. The company delivered 7,225 vehicles in January and 5,578 in February.
- Nio expects total revenues of 7.38 billion yuan to 7.56 billion yuan in the first quarter versus 6.64 billion yuan in the fourth quarter.
- Pre-orders for the et7 sedan revealed in January exceeded other Nio models, but specific figures were not released.
- Company remains on track to enter the European market later in 2021.
- The backlog in chip manufacturing is due to the high demand for electronics amid COVID-related lockdowns, as well as pressure from US-China trade tensions.
NIO: Nyse is down 5.18% pre-market.
