On March 5th, Beijing time, NIO released its financial reports for the fourth quarter and full year of 2023. This is the second new energy car company to release its annual report after Ideal.
Data shows that in the fourth quarter of 2023, NIO's revenue was 17.10 billion yuan, a year-on-year increase of 6.5%; The gross profit margin of the entire vehicle is 11.9%, reaching double digits for two consecutive quarters.
In 2023, NIO's revenue reached a record high of 55.6 billion yuan, a year-on-year increase of 12.9%; The net loss (adjusted) was 18.35 billion yuan, an increase of 51% from the previous year. It is worth mentioning that as of the end of the fourth quarter of 2023, NIO's cash reserves reached 57.3 billion yuan, a significant increase of 12.1 billion yuan compared to the previous quarter.
The annual gross profit margin of the entire vehicle is 9.5%
According to the financial report, NIO delivered a total of 160038 new cars throughout 2023, a year-on-year increase of 30.7%. The total annual revenue was 55.6179 billion yuan, an increase of 12.9% compared to the previous year. The adjusted net loss (non GAAP) for the whole year of 2023 was 18.357 billion yuan, an increase of 51.1% compared to the previous year. The company's gross profit margin for the whole year was 5.5%, compared to 10.4% in 2022; The gross profit margin of the whole vehicle during the same period was 9.5%, compared to 13.7% in 2022.
Regarding the situation where NIO's revenue and net loss are both high, Zhang Xiang, director of the Vodafone Digital Automotive International Cooperation Research Center, told Time Finance that as a newly established new force car company, NIO has a large number of models, high research and development investment, and high revenue and loss are normal circumstances.
From the market performance perspective, in June 2023, NIO made its first price adjustment, with a price reduction of 30000 yuan across the entire series, driving NIO's delivery volume to rebound in the third quarter. But as competition in the new energy vehicle market intensifies, NIO's sales in the fourth quarter have once again rebounded, with monthly deliveries ranging from 16000 to 18000 units.
In 2023, NIO reached 8 models for sale, completing the coverage of the main segmented markets for high-end brand mid size sedans and SUVs, and switching its products to the NT2.0 platform.
NIO 2023 Annual Report.
Faced with the question of "living" during the live broadcast, Li Bin, founder, chairman, and CEO of NIO, candidly said, "Let users speak. If users don't support us, we won't be interested in living. If users support us, we will live a long life."
In its financial report, NIO provided an expected sales volume of 31000-33000 vehicles for the first quarter of this year, with an expected revenue of 10.5-11.09 billion yuan for the first quarter. The sales figures for January and February of this year have been announced, which means that the sales in March need to reach 13000-15000 units to meet the target.
With the comprehensive launch of the 2024 model, it will bring new assistance to sales. The delivery of the 2024 ES8, EC7, ES6, EC6, and ET5T models will begin in March; The delivery of the 2024 ET5 will begin in April; The 2024 ES7 will begin delivery in May; The 2024 ET7 will be released and unlocked in April.
At the same time, NIO will launch a comprehensive push of NOP+, including highways, urban areas, and battery swapping, in the second quarter. The end side multimodal large model NOMI GPT is also about to be launched.
NIO stated that as the second-generation technology platform models gradually enter the market and NIO's organizational efficiency improves, NIO is expected to further expand its market size in 2024.
R&D expenses exceeding 10 billion yuan, focusing on charging and swapping facilities
However, research and development expenses account for a relatively high proportion of NIO's losses.
The financial report shows that the R&D expenses in the fourth quarter of 2023 were 3.9721 billion yuan, mainly due to the increase in design and development costs of new products and technologies, as well as the increase in R&D functional personnel costs, with a month on month increase of 30.7%, exceeding 3 billion yuan for five consecutive quarters. The annual R&D investment was 13.43 billion yuan, exceeding 10 billion yuan for two consecutive years.
The continuous investment in technology and charging and swapping infrastructure has also become a moat for NIO. As of the end of 2023, NIO's investment in research and development has exceeded 40 billion yuan, and the global number of patents has exceeded 8500.
In 2023, NIO released the first vehicle wide operating system SkyOS · Tianshu, the LiDAR main control chip "Yang Jian", and NIO Link NIO Panoramic Interconnection. It also unveiled the already mass-produced cross domain fusion supercomputer cluster ADAM CCC, and released core technologies such as the intelligent driving chip Shenji NX9031 and the full domain 900V high-voltage architecture.
With the release of its financial report, NIO also announced that the 150 degree ultra long endurance battery pack will be launched in the second quarter.
NIO stated that as the largest capacity battery pack in domestic passenger car production, the NIO model equipped with this battery pack has a maximum range of 1055 kilometers.
According to public information, the NIO 150kWh battery pack was released on NIO Day in 2021. It adopts a solid-liquid hybrid electrolyte and belongs to a semi-solid battery, with an energy density of up to 360Wh/kg, exceeding the 255Wh/kg of CATL's Kirin battery. It is currently one of the products with the highest power and energy density that can be mass-produced in China.
NIO President Qin Lihong stated in February 2023 that the cost of NIO's 150 kilowatt hour battery is very high, equivalent to the cost of an ET5. However, with the price of lithium carbonate dropping from a high of 600000 yuan per ton to around 100000 yuan per ton, the cost of a 150 kilowatt hour battery is no longer unattainable.
In addition to ultra long endurance semi-solid state batteries, the construction of charging and swapping infrastructure is also rapidly advancing. NIO stated that it will build another 1000 battery swapping stations and add 20000 charging stations throughout the year. The deployment of the fourth generation power station and 640kW fully liquid cooled ultra fast charging piles will begin to further enhance the user's power charging experience.
It is worth noting that the battery swapping mode is currently gaining recognition from multiple parties. As of now, multiple enterprises such as Changan, Geely, Jianghuai, Chery, and Nanwang Energy Storage Technology have reached cooperation with NIO for battery swapping, which is expected to become a new growth point for NIO.
Subbrand First Car Benchmarking Model Y
Faced with cost and profit issues, Li Bin is doing his best to expand space.
In December 2023, NIO announced on the Hong Kong Stock Exchange that it had signed a definitive agreement with Anhui Jianghuai Automobile Group Co., Ltd. to acquire certain production equipment and assets from the first and second advanced manufacturing bases in Jianghuai, with a total price excluding tax of approximately RMB 3.16 billion.
Li Bin once stated at a performance meeting that "from a manufacturing perspective, if we were to manufacture entirely independently, manufacturing costs would decrease by 10%.".
In addition, facing the fierce price war in the car market, Li Bin will place more hope on the sub brand Alps.
At the 2023 financial report conference call, Li Bin stated that the Alps brand will be released in the second quarter of this year, and the first product will be released in the third quarter and delivered in the fourth quarter. The brand will adopt a separate sales network and part of NIO's after-sales system, and share the battery swapping network with NIO. The deployment of the fourth generation battery swapping station will begin in April this year. This shared battery swapping network will be shared with other brands, but there are also some battery swapping stations exclusive to the NIO brand.
Li Bin stated that the Alps brand is aimed at the mass market, and the first car is undergoing various tests, so spy photos may be released. This brand focuses on the home market and will launch different products based on households of different sizes. "Our research is deeper and has a latecomer advantage, so we believe it is very competitive."
Recently, a camouflage image of the first Alpine model has been circulating online. The new car adopts a coupe SUV design, and the glass of the car is also printed with the slogan "better than Maodou Y.".
At the "User Face to User" event on March 2nd, Li Bin bluntly stated that the new car's competitor is the Tesla Model Y, and it is a "comprehensive benchmark". Li Bin also shouted from afar, "Users who want to buy Model Y can wait, our car prices will definitely be cheaper."
Li Bin summarized the advantages of the new car as follows: "The Alps are bigger than you (a competitor), can exchange batteries, have a larger screen, and charge faster than you.". Based on NIO's technological roadmap, the new car will not only be based on the NT3.0 technology platform, but also have complete configurations such as 800V overcharging and battery swapping.
For the future model planning, Li Bin also made spoilers. He stated that the second model is an SUV aimed at large families, which has entered the mold development stage and is progressing smoothly; The third product is already in the development process.
Li Bin also stated that the new product mainly undertakes the task of sales volume, while the NIO brand is responsible for ensuring the gross profit margin. NIO's main brand will not launch cars that are cheaper than the ET5, and new cars will also be more expensive. The company "does not exchange volume through price wars.".
At the event on March 2nd, Li Bin bluntly stated, "In order to avoid competition between Alps and NIO, NIO will continue to enhance its brand tone and pricing in the future, ensuring sufficient price space for Alps. NIO will truly focus on the high-end and give up a portion of the mid-range market."
Li Bin is very optimistic about the prospects of the Alps, believing that a single car model can achieve monthly sales of 40000 to 50000. As for whether we can have such competitiveness, let's wait and see.