An electric SUV Nio Inc. ES6 at a battery exchange station in a parking lot in Shanghai on March 1, 2021.
Qilai Shen | Bloomberg | Getty Images
BEIJING – China’s electric car Nio said on Tuesday that a global shortage of chips would force it to produce fewer cars in the second quarter.
High demand for electronic products amid the coronavirus pandemic and pressure due to US-China trade tensions on the highly specialized semiconductor supply chain have contributed to a delay in chip manufacturing.
As a result, major car manufacturers have had to cut production, China-based Nio has announced the latest cuts.
The company increased production capacity in February to 10,000 vehicles per month, up from 7,500 previously, founder William Li said in a quarterly revenue call. But a lack 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 lagged ahead of start-up rivals in terms of vehicle sales.
The company delivered 7,225 vehicles in January and 5,578 in February during the week-long Lunar New Year celebration. With a forecast of 20,000 to 25,000 deliveries in the first quarter, Nio anticipates that deliveries will increase to at least 7,197 cars in March.
Instead, Xpeng said on Tuesday that it delivered 2,223 electric cars last month, while Li Auto expects to deliver less than 4,000 cars a month in the first quarter.
Nio founder Li said the pre-orders for the et7 sedan unveiled in January exceeded that of the company’s other models, but declined to share specific figures. Et7 is Nio’s first non-SUV consumer car and will start delivering next year.
Li added that the company was on track with plans to enter Europe later this year.
New York-listed Nio shares fell 4 percent in extended trading after reporting a fourth-quarter revenue loss of 0.93 yuan (14 cents) per share. This is higher than the loss of 0.39 yuan per share predicted by analysts, according to FactSet.
The company attributed a quarterly increase of nearly 33% in net losses – to 1.39 billion yuan ($ 212.8 million) in the last three months of 2020 – mainly due to the depreciation of the US dollar.
Shares of Nio rose more than 1,000 percent last year after the struggling start-up received a $ 1 billion capital injection from state-backed investors and traders piled up in shares, along with an increase in Tesla shares.
Looking ahead, Nio expects total revenue of 7.38 billion yuan to 7.56 billion yuan in the first quarter, up from 6.64 billion yuan in the fourth quarter.