Two weeks ago, an NIO test vehicle, fell from a height at the Shanghai Auto Innovation Port, killing two test drivers. Subsequently, NIO issued a statement, presumably meaning that based on the analysis of the scene, it was initially confirmed that this was an accident not related to the vehicle itself. Such a statement that belittles the tragedy of human life and rushes to clear the air instantly triggered a PR crisis for NIO, with netizens violently accusing it of being "too cold-blooded".
NIO did not continue to respond, seemingly intending to take a cold approach to this PR crisis and wait for the heat of the incident to subside. However, the house leaked, and recently an NIO car lost control at the entrance of a hospital in Henan Luohe, knocking down a number of pedestrians and knocking down a number of pedestrians on the roadside, injuring six people, one of whom died after the rescue, the other five with non-life-threatening injuries and serious damage to the vehicle.
This is the second accident in a row in half a month. The death of the test driver has not yet subsided, and the loss of control has once again put NIO in the limelight.
Although according to the police report issued by the Luohe Public Security Bureau Traffic Management Detachment, the accident was caused by driver error, meaning that officials have proved for it this time that it had nothing to do with the vehicle itself.
But ironically, there was no statement from NIO about the accident. The silent response might have gone some way to avoiding damage to the brand image due to the "unprofessional" PR. However, the lack of response has annoyed many people who want to nail NIO to the "cold-blooded" pillar of shame.
What's more, in light of these two incidents and the current situation of NIO, it seems that this self-proclaimed head of the new powerhouse is having a dark moment.
In fact, the most recent headache for NIO is not only the PR story but also the shorting report issued by Grizzly Bear. The latter report accused NIO of "accounting games" and exaggerated revenue and profitability, which is tantamount to revealing NIO's hidden secrets to the public.
The report aims to reveal that NIO's actual revenue and net income were inflated by about 10% and 95% respectively through its related party, Wuhan Weineng, which contributed at least 60% of the earnings growth. In addition, Wall Street had expected NIO to lose 5.947 billion in fiscal 2021, but NIO reported a net loss of 50% higher than expected at 3.007 billion RMB, which Grizzly believes is also attributable to UE.
Although NIO's mouth does not acknowledge what the Grizzly report refers to, and says it will take legal action to defend the interests of its shareholders. But as of now, it hasn't come up with any strong "evidence", and its market value has evaporated by HK$36 billion because of the short-selling report, which is very heartbreaking.
After all, NIO is really short of money right now.
The data shows that NIO reported a net loss of 4.02 billion RMB for the full year of 2021, and the 1Q of this year's earnings report continues to perpetuate the loss the more it sells, reaching a staggering 1.783 billion RMB, expanding to 295.56% year-over-year. Even more worrisome is NIO's chronically weak revenue growth, which has been in the 5-10% range for 5 consecutive quarters, according to its earnings data.
Further, NIO's sales are also starting to fall off.
According to public data, in the first half of 2022, deliveries of XPENG and LEADING IDEAL in "Wei Xiaoli" were 68,983 and 60,403 units respectively, up 124% and 100% year-on-year. NIO's deliveries in the first half of the year were only 50,827 units, and its year-on-year growth was only 21.10 percent. Even NETA and LEAPMOTOR made up ground, with 63,131 and 5,1994 deliveries respectively, up 199% and 265% year-on-year.
NIO has been falling behind in sales performance for some time. Since July last year, it has lost the top spot in monthly deliveries of new cars, and in February this year, it was pushed out of the top three by NETA Motors and slipped to fourth, a clear indication of the decline in NIO's sales.
There was a time when NIO was at the top of the new power camp, sitting in the number one spot with just one ES8. Now in addition to the ES8, NIO has released a new model ES7 this year, and there are plans for upgraded versions of the ES8, ES6, and EC6, plus two sedans, the ET5 and ET7, for a full six products, still the most abundant model matrix among the new forces as of now.
It is reasonable to say that with the horse-trading effect, it should leave its peers far behind. However, the reality is not the same, as NIO's new vehicles have not caused much of a ripple or concern, especially with the LEADING IDEAL L9 and the XPENG G9 in the background. The reason for this is that the ES7 continues the style of fighting within the NIO model sequence, with the models' best competitors all being their own models. Needless to say, this is a red flag for NIO's product planning.
In addition, the ES7's launch also announces the NIO brand's belief in going all the way to the black on high-end models. But on the other hand, it also means that NIO's net profit is even more out of reach.
Meanwhile, there is little left of the electrified high-end platform play that NIO was once proud of, with Tesla's downward spiral and the rise of local domestic electric car brands; in terms of intelligent driving, it has claimed since 2017 that it will first be equipped with Mobileye Q4 to support driverless driving, yet today, five years later, it does not reflect its LIDAR endorsement in hardware, except in The solid-state lithium-ion 2022 mass production plan announced two years ago at NIO DAY along with ET7 is no longer mentioned by NIO.
All in all, I'm afraid the only thing that can hold up to the brand's "high-end" story is its biggest brand tag - "service". The only thing left to support the brand's "high-end" story is its biggest brand label - "service".
However, when one after another, public relations events reveal the cold-blooded nature of NIO as a company and capital; when overseas well-known shorting agencies report NIO's internal financial structure is in disarray; when the aura of avant-garde technology once based on high-end is fading. I'm afraid that consumers, or rather fans of NIO's faith, will inevitably become a little bit disenchanted.
In its eight years of existence, NIO has been in crisis a little too often, it seems. Remember that three years ago, NIO's helmsman Li Bin was seen by the media as the worst of the worst in 2019, a year in which Li Bin was in the midst of a scorcher and NIO was on the verge of ICU. It was a good thing that the Hefei State-owned Assets Supervision and Administration Commission gave 7 billion yuan of life-saving money at that time to help it pull through, which led to the reversal of the drama that later saw the market value soar by 100 billion yuan. Now, in the darkest hour, can Li Bin save the day again and lead NIO through it? We'll see.
