"According to regulations, the warranty period for new energy vehicle batteries is basically 8 years. From 2025 to 2022, nearly 20 million new energy vehicle batteries will expire, and users will face difficulties such as power battery out of warranty, 'different battery life', and high battery replacement costs. Based on this, NIO Chairman Li Bin called on the industry to pay attention to battery life, believing that solving the problem of battery life is urgent.".
On March 14th, NIO and CATL signed a framework agreement to promote research and innovation in long-life batteries based on NIO's battery swapping scenario needs. The long-term battery technology and operation goal proposed by NIO is to achieve a health level of no less than 85% after 15 years of use of power batteries.
In Li Bin's view, the issue of battery life is not only a problem that NIO needs to solve, but also a common problem faced by the entire industry. "The current price, technology, and configuration of new energy vehicles hope to also 'roll' the battery life," said Li Bin.
Some new energy vehicles may face battery out of warranty issues
Normally, the range that a vehicle can travel can reach 1 million kilometers, but currently the battery cycle life in the industry can only reach 240000 kilometers, which is significantly lower than the range that a vehicle can travel. "The average service life of vehicles can reach 15 years, but the current industry average warranty period is only 8 years," Li Bin explained.
In April 2015, the Ministry of Industry and Information Technology, the Ministry of Finance, and the Ministry of Science and Technology issued a notice on financial support policies for the promotion and application of new energy vehicles from 2016 to 2020, which clearly stated that new energy vehicle production enterprises should provide consumers with quality assurance for energy storage devices such as power batteries, drive motors, and motor controllers. Among them, passenger car manufacturers should provide a warranty period of no less than 8 years or 120000 kilometers.
Official website of the Ministry of Industry and Information Technology
According to data released by NIO, the cumulative insurance coverage of new energy vehicles in China has reached nearly 20 million since 2016. According to the 8-year battery warranty, new energy vehicles in 2016 will begin to face the problem of battery out of warranty this year. "After the battery is out of warranty, the available range will be significantly reduced, which may break through the safety bottom line, but the problem must be solved." Li Bin said that not only that, but the cost of replacing the battery in the later stage after the battery warranty expires is a considerable expense. At present, some new energy vehicle users in the market have a maximum battery replacement cost of over 230000 yuan.
Zeng Shizhe, Vice President of NIO Battery Systems, introduced that the scientific path to achieving long-life batteries is the combination of intrinsic research and operation innovation of batteries, including battery chemical materials, battery cell structure, cloud operation, large model prediction, health operation and maintenance, etc. In terms of operation to solve the problem of battery life, NIO has built an intelligent cloud operation system for batteries, including cloud BMS, cloud recycling, digital twins, cloud health, cloud configuration, cloud services and other multiple sectors. "Long life batteries are not simply about extending their lifespan, but about innovating their systems," Li Bin emphasized.
NIO stated that through technological research and unique battery swapping operations, the full lifecycle battery health operation system established by NIO can achieve full coverage of the three major factors affecting battery life: temperature, intensity, and frequency. Based on the operation and scheduling of big data on power batteries, further improve the service life of power batteries in the battery swapping system, so that the battery can have 80% health after 12 years of use.
Lowering BaaS rental fees and offering free mobile phones for car purchases
On March 14th, NIO also released a new BaaS battery rental service pricing plan, which not only adjusted the rental service fees for standard and long-term battery packs from 980 yuan and 1680 yuan per month to 728 yuan and 1128 yuan per month, respectively, but also introduced multiple stacked preferential policies.
In the current increasingly fierce price war for new energy vehicles, some believe that NIO's move is a disguised price reduction. "Although our original intention was not to lower prices, in today's market environment, this is even more aggressive than usual. This Bass adjustment is very cost-effective for new car users," said Qin Lihong, co-founder of NIO.
Regarding the reason for the recent reduction in BaaS battery rental service fees, Shen Fei, Senior Vice President of NIO, stated in an interview with the Daily Economic News that the lower bank interest rates have provided room for a reduction in BaaS battery rental service fees. At the same time, the company's operational capabilities have further improved, and the battery life has been longer than expected, which are also factors contributing to this adjustment. "In the fiercely competitive market environment, lowering the BaaS battery rental service fee will help enhance NIO's product competitiveness and overall sales." Shen Fei said.
The reporter learned that in order to increase sales, NIO also launched a promotion in March called "Buy a car and get your phone free". "Users who place orders for the 2024 NIO new car on the NIO app will receive a complimentary NIO phone upon pickup," a NIO salesperson told reporters on March 15th.
According to the plan, NIO's monthly sales will return to the level of 20000 vehicles in 2024. However, according to official data, the delivery volume of NIO's new cars from January to February this year was 10055 and 8132, respectively, which is still a considerable gap from the expected 20000 vehicles. In the first quarter of 2024, NIO expects to deliver 31000 to 33000 new vehicles.
It is reported that in May this year, NIO will launch its second brand, "Le Dao". Unlike the NIO brand, Le Dao will mainly focus on the mainstream family car market and pursue more sales. The first model under the Ledo brand has been named the Ledo L60, benchmarking against the Tesla Model Y, but the cost will be reduced by about 10% compared to the Tesla Model Y. The new car will be released in the third quarter of 2024 and will begin large-scale delivery in the fourth quarter.
