Zacks Equity Research
Thu, May 26, 2022
Per an environmental assessment report, NIO Inc. NIO plans to invest RMB 218.5 million ($32.8 million) to build lithium-ion battery labs and a cell pilot production line in Shanghai.
The plan consists of a research & development (R&D) project in Anting town, Shanghai, comprising 31 R&D labs partaking in lithium-ion cell and battery pack research and development, a lithium-ion cell pilot line and a battery pack production line.
The projects are expected to begin between August and October this year. The company looks to lease a sprawling, local industrial building for the same.
The labs will have the potential to explore the resilience of the charge and discharge, temperature and safety performances of lithium-ion cells and packs under varied physical experimental conditions.
NIO will test the prospect of the cell material properties and battery pack in optimized conditions and is expected to have 400 R&D personnel.
The pilot project will be engaged in the trial production of lithium-ion cells and battery packs, forming the basis of future large-scale production exploration and trial samples for further research.
The firm’s strong standing with the government of China offers it an advantage in country’s massive market. China’s intense push for EV is a major booster for NIO. ES6, ES8 and EC6 models are enhancing the firm’s prospects. The strategic collaboration with Mobileye for developing driverless vehicles in China also bodes well for NIO’s prospects. This year, the firm intends to deliver three new products based on the NIO Technology Platform 2.0, including the ET7 model. In fact, deliveries of ET7 commenced recently. NIO seems to be well-positioned to cement a long-term foothold in the rapidly growing EV industry.
Shares of NIO have lost 60.4% over the past year compared with its industry’s 21.6% decline.
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