Chinese electric car company Nio launched its lower-cost brand Onvo on Wednesday, May 15, 2024 in Shanghai, China.
CNBC | Evelyn Cheng
SHANGHAI – Chinese electric car company child revealed on Wednesday that the first car from its new lower-priced brand, Onvo, will be about $4,000 cheaper than tesla Comparable Y model.
Deliveries of Onvo's first car, the L60 SUV, will begin in September, the company said. Pre-sales began after Wednesday's launch event.
Nio CEO William Li said he expects Onvo to start selling its cars overseas at some point, but did not specify when, according to an interview with CNBC's Eunice Yoon.
Since its launch about 10 years ago, Nio has focused on the premium car segment, with prices around 300,000 yuan (US$41,500) or more. The company has since expanded into Europe, but its monthly deliveries in China have remained generally modest compared to the competition.
Onvo's L60 starts at 219,900 yuan (US$30,439) versus 249,900 yuan (US$34,617) for the Model Y. Elon Musk's electric SUV has been one of the best-selling pure-battery electric cars in China.
Fierce competition in China's electric car market has invited new entrants and prompted many companies to cut prices.
smartphone company Xiaomi At the end of March it entered the electric car market with its SU7 sedan to rival the Tesla Model 3 with a price that was also about $4,000 cheaper.
Since then, the Model 3 has reduced its price by about $2,000, to 231,900 yuan (US$32,124), according to Tesla's China website. Xiaomi said on Wednesday that it had delivered 10,000 SU7 vehicles.
BYD, which sold more cars than Elon Musk's automaker last year when hybrids are included, mainly sells cars in the range of 100,000 yuan (US$13,851) or less. BYD has begun to expand into higher price segments in recent years.
Nio CEO Li confirmed to CNBC that the L60 uses lower-priced batteries from BYD.
Global competition from Chinese electric vehicle manufacturers has also led to stiff new tariffs by the Biden administration on vehicle imports to the US. Chinese electric vehicles will be subject to a 100% tariff, the administration announced on Tuesday.
When asked about the new taxes, Li called them “completely unreasonable,” according to a CNBC translation from Mandarin to English. Li also highlighted the impact on consumers and climate goals.
A 'new standard' family car to rival Tesla
Onvo aims to set a “new standard” for the family car, Alan Ai, president of the Nio sub-brand, said at Wednesday's launch event in Mandarin, translated by CNBC.
The brand name means “On Voyage”, while its Chinese name “Le Dao” is intended to evoke a family spending happy times together.
Ai made many comparisons to the Model Y and other cars during his presentation.
He said the L60's interior was more spacious than the Tesla Model Y and Toyota Rav4. He also said Onvo's new car had better shock absorption and had tighter figure-eight shapes compared to its competitors.
The autonomy announced by Onvo on a single charge is at least as great (or even more) than that of the Model Y, depending on the version.
As a sub-brand, Onvo vehicles can access many of Nio's battery-swapping and charging stations, Ai said.
Ai also showed videos of Onvo models using driver-assistance technology to navigate country roads and city streets.
Tesla's driver assistance software, Full Self-Driving, is not yet available in China, but is expected to be close to gaining approval from Beijing for launch.
