NIO Announced That It Must Make the Company Profitable by 2026

 

On November 25, at NIO's tenth-anniversary celebration, William Li, founder of NIO (NYSE: NIO; HKEX: 9866; SGX: NIO), released an internal letter asking NIO employees to constantly strengthen the bottom-up system capacity and operational efficiency. William Li expressed that the development in the next two years determines NIO's success. Within these two years, NIO must continue to launch competitive new products to ensure user satisfaction and optimize the core business to improve operational efficiency. In this way, NIO will reach the goal of doubling its sales by 2025 and achieving profitability by 2026.

 

On November 20, NIO announced its unaudited financial results for the third quarter ended September 30, 2024, showing that operating income in the third quarter of 2024 was $2,661.0 million, increasing 7.0% year-over-year. The gross profit margin increased to 10.7%. Vehicle deliveries were 61,855, setting a new single-quarter high.

 

On its Q3 earnings call on the same day, NIO admitted NIO faced short-term pressure of building sales and service systems from the company's perspective. Therefore, its business strategy is to gradually refine the cost structure and reduce costs as production volume increases.

 

In terms of the macro market, NIO remains committed to overseas markets for the long term but will prioritize products of Onvo and Firefly for entry into global markets. Although EU tariffs have led to higher prices for vehicles sold to Europe, NIO believes that the tariffs will have little impact on its products or prices.

 

 

In terms of products, also on November 20, NIO officially announced its third brand, Firefly, which will debut on December 21. Its first model is expected to be delivered in the first half of 2025. Firefly is for the boutique compact car market and is designed to diversify NIO's product portfolio and drive sales growth. Firefly develops extended-range hybrids that will be only sold overseas to facilitate the mass adoption of electric vehicles in the Middle East.

 

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