Red Star Capital Bureau reported on June 7th that NIO (09866. HK/NIO. US) released its 2024 Q1 report on the evening of June 6th. In the first quarter, the company achieved a revenue of 9.91 billion yuan, a year-on-year decrease of 7.2% and a month on month decrease of 42.1%; The net loss was 5.18 billion yuan, an increase of 9.4% year-on-year and a decrease of 3.4% month on month; Delivered 30000 new cars, a year-on-year decrease of 3.2% and a month on month decrease of 39.9%.
Affected by this news, NIO US stocks closed down 6.83% on the same day. As of the release by the Red Star Capital Bureau, NIO Hong Kong stocks fell 7.4% on the 7th.
At the financial report conference that evening, Li Bin, founder, chairman, and CEO of NIO, answered questions from investors about the company's gross profit margin, business plan, progress on the second brand of Ledo and the third brand of Firefly, as well as the prospects of NIO Energy.
First quarter vehicle gross profit margin of 9.2%
Target Q2 return to double digits
In the first quarter of this year, NIO's gross profit margin for vehicles was 9.2%, compared to 5.1% in the same period last year, and 11.9% in the fourth quarter of 2023; The overall gross profit margin is 4.9%, compared to 1.5% in the same period last year and 7.5% in the fourth quarter of 2023. The year-on-year increase in gross profit margin of the whole vehicle is mainly due to the decrease in unit material cost, and the month on month decline is mainly due to the increase in discounts during product switching, which leads to a decrease in average selling price and changes in product portfolio, partially offset by the decrease in unit material cost.
Li Bin said, "Starting from June, we will focus on adjusting our product structure, increasing the proportion of high gross profit margin products in the first tier, and narrowing the policy of short-term promotions. Overall, while ensuring steady sales growth, optimizing gross profit margin is an important task for us in the next stage. The gross profit margin of the entire vehicle is expected to return to double digits in the second quarter and continue to improve in the third and fourth quarters."
He emphasized that NIO's business goal is to sell 30000 vehicles per month, with a gross profit margin of 20%, and to achieve profitability in its core business in China. NIO will switch to the third-generation platform starting next year, hoping to increase its gross profit margin through more self-developed technologies.
In the first quarter of this year, NIO's R&D expenditure was 2.86 billion yuan, a year-on-year decrease of 6.9% and a month on month decrease of 27.9%. The reason for the reduction is the reduction in design and development costs caused by the different development stages of new products and technologies, as well as the reduction in costs for R&D functional personnel. In addition, its sales, general, and administrative expenses amounted to 3 billion yuan, a year-on-year increase of 22.5% and a month on month decrease of 24.6%.
As of March 31 this year, the company's cash reserves were 45.3 billion yuan.
In May, NIO delivered a total of 20544 new cars, a year-on-year increase of 233.8% and a month on month increase of 31.5%, setting a new historical high. Looking ahead to the second quarter, NIO is expected to deliver 54000-56000 units, a year-on-year increase of 129.6% -138.1%; The revenue guidance was 16.59 billion yuan to 17.14 billion yuan, a year-on-year increase of 89.1% -95.3%.
Ledo orders exceeded expectations
The delivery of the third brand will begin in the first half of next year
On May 15th, NIO officially released its second brand, Ledo, and the first model, L60, will begin delivery in September. Li Bin stated during the financial report conference call that Ledao had already received orders that exceeded expectations even before a store opened. In September, there will be 100 stores in the Ledao Fair, with an investment of 1-2 million yuan per store.
Ledo will release its second product next year, which is a mid to large-sized SUV. "Ledo won't have too many products, we need to ensure that each car has sufficient competitive advantage. Ledo's long-term goal is to maintain a gross profit margin of over 15%, achieve monthly sales of 20000 to 30000 units, and achieve breakeven."
Li Bin promised that by the end of the year, there will be over 1000 battery swapping stations available for Ledao. "After an investment of two to three hundred thousand yuan, the third-generation power station can be used by Ledao. The fourth generation station will be officially deployed next week, compatible with Ledao and NIO."
Regarding the rumored third brand, Li Bin revealed that Firefly Firefly is positioned as a boutique small car in China, serving the demand for a second family car, and aims to start delivering it in the first half of next year. NIO, Ledo, and Firefly all have battery swapping capabilities, with main sales ranges of over 300000, over 200000, and over 100000 yuan, respectively.
Order exceeds production capacity
NIO's Third Factory Construction Starts
Li Bin mentioned that the orders received in May have exceeded production capacity. On June 5th, Qin Lihong, co-founder and president of NIO, revealed to the public that NIO's third factory (F3) is located in the Xinqiao Intelligent Electric Vehicle Industrial Park in Hefei and has recently started construction with a single shift capacity of 100000 vehicles, which will be used for the production of NIO and Ledo brand products in the future.
Qin Lihong stated that due to the recent hot sales and long-term strategy of the NIO brand, NIO's two existing factories in Hefei have reached the designed single shift production capacity. With the launch of subsequent new products, the production capacity of existing factories is no longer able to meet market demand. NIO does not have overcapacity issues.
According to the Tianyancha APP, NIO Automotive Technology (Anhui) Co., Ltd. Third Manufacturing Base Branch was established on May 14th, with Qin Lihong as the person in charge.
NIO currently has two complete vehicle factories, namely the Hefei Advanced Manufacturing Base (F1) and the NIO Second Advanced Manufacturing Base (F2) in the Xinqiao Intelligent Electric Vehicle Industrial Park, with an annual designed production capacity of up to 300000 vehicles.
NIO Energy received a state-owned investment of 1.5 billion yuan from Wuhan
There is an independent financing plan
On May 31st, NIO Energy received a strategic investment of 1.5 billion yuan from institutions such as Wuhan Guangchuang Fund. This round of strategic investment will be used for technology research and development, manufacturing, operation and maintenance in charging, power exchange, energy storage, battery service, energy Internet and other fields, as well as the layout and development of Weilai Energy's charging and power exchange infrastructure, and support the investment in vehicle network interactive innovation business.
Li Bin stated during the financial report conference call that NIO Energy has an independent financing plan and will continue to open up investment in the future. At present, NIO provides 60 orders per day for each battery swapping station to achieve breakeven, with an average of 30-40 orders now. "We have great confidence in the long-term sustainability of NIO Energy's operations. Considering investments in energy storage, flexible upgrades, and other areas, we have no doubt about the profitability of the swapping stations."
As of now, NIO has established cooperation in the field of battery swapping with multiple automotive companies such as GAC Group (601238. SH), Changan Automobile (000625. SZ), Geely Holdings, Chery Automobile, Jiangqi Group, and Lotus. It has also established battery swapping cooperation with energy and power enterprises such as Sinopec, CNOOC, Shell, State Grid, Southern Power Grid, and Wanneng Group. NIO also achieves charging interconnection with car brands such as Changan, Geely, SAIC General Motors, Xiaopeng Motors (09868. HK/XPEV. US), Geely, Lotus, and Zhiji.
Red Star News reporter Wu Danruo
