INTERNATIONAL - NIO Inc., the U.S.-listed Chinese upstart seeking to take on the likes of Tesla Inc., said China will continue to be a big luxury car market despite falling car sales.
“Unlike developed markets such as America where the number of new cars and end-of-life vehicles is almost balanced, China’s auto market growth is still incremental though it is reaching a watershed,” William Li, founder of NIO, told reporters in Shanghai on Sunday.
“Plus, electric vehicles sales grow fast in China and sales of luxury cars are unlikely to drop.”
Facing fierce competition in China’s auto market, Li said NI0 is conducting preliminary research about breaking into overseas markets, including legal compliance and adopting a business model that will adapt to local costumers, though it was still too early to present a detailed plan.
NIO raised $1 billion in a New York initial public offering in September that valued that company at $6.4 billion. The carmaker started to deliver its seven-seater ES8 sport utility vehicles to consumers in June and added a new model ES6 to its lineup earlier this month.
NIO has been ramping up production of the ES8 SUV, its first commercial product, at a partner’s plant in the eastern city of Hefei. Li has pledged to deliver 10,000 vehicles to customers by year’s end. NIO needs to sell about 100,000 vehicles a year to break even, according to estimates by Sanford C. Bernstein & Co.
Car sales in the world’s second-biggest economy declined for a sixth consecutive month in November, bringing the China market closer to its first annual drop in at least two decades.
New York traded NIO has risen 23 percent since its debut and closed at $7.70 on Friday.