China’s NIO in direct competition with Tesla

ABU DHABI: Chinese upstart automaker named NIO is all set to take on the electric vehicle manufacturing giant, Tesla. It has unveiled the ES8, an all-electric sport-utility vehicle made specifically for its home turf. The ES8 is an extremely stylish high-performance product of NIO. It is said to fit seven passengers inside its all-aluminum body and chassis. NIO has a leg up on the competition with Tesla’s Model X. But there is a big difference between the two luxury SUVs, mainly in their prices.

According to certain reports, NIO’s ES8 is about half the price of the Model X. The ES8 has a starting price of 448,000 Chinese yuan (roughly AED 239041, while the Model X runs for 836,000 yuan (AED 446067). So, there is a whopping difference between their prices, that is, NIO’s ES8 costs even less. Such a massive price difference could undercut expansion of Tesla in its biggest global market.

NIO founder and chairman, William Li has assumed that the launch of NIO ES8 may or may not affect the sales of Tesla X. Tesla and NIO are set to compete in countries outside of China as well. In 2020, NIO plans to bring its autonomous Electric Vehicles in the U.S. also, including its EP9 model, a vehicle that is sure to provide tough competition for Tesla’s newly announced Roaster, which is set to debut in 2020 as well.

While the ES8 is just the first mass-market vehicle, the company is planning to offer a full portfolio of vehicles ranging from city cars to self-driving cars, to world-beating supercars, all of which the company plans to sell globally. So, from where will the funds flow in? The company is looking to draw investments to fund its ambitious plans, and as per some reports, NIO is set to launch an IPO in the U.S. as soon as next year.

NIO saw a $1 billion investment from Chinese giant Tencent earlier this year and is also aiming to sell its stake in the U.S. business for $300 or $400 million, which would value those operations at more than $1 billion.