Nio Inc. NIO recently launched an Android smartphone. The automaker expects at least half of its existing users to buy the smartphone. The smartphone is in the price range of $900-$1,000, which is comparatively cheaper than a Huawei smartphone.
Per CNBC, more than half of Nio users use iPhones and the other half use Android smartphones from Huawei and other brands. The automaker believes that the other half of its users are more likely to use Nio’s smartphone while changing their phones.
Nio is the first Chinese electric vehicle (EV) manufacturer to launch a smartphone. The EV companies in China have made in-car entertainment and mobile phone connectivity a selling point.
The company is scheduled to start deliveries of its smartphone from Sep 28.
Nio’s Swedish counterpart, Polestar, has plans to launch its smartphone in December. Smartphone giants Apple and Xiaomi have been working on cars as well.
Nearly two years ago, Huawei released its electric car brand, Aito, in China. The cars are integrated with the company’s smartphone operating system.
Per William Li, CEO of Nio, the smartphone will allow users to seamlessly connect with the car.
Anyone in China can buy the smartphone, even if they don’t own a Nio car. The Nio app has 600,000 active users per day, almost 1.5 times its car users.
Per Li, the company has no plans to launch the smartphone in Europe, at least not until the market expands.
Li called the competition in the domestic EV market “fierce,” but he believes that the company’s business investments will discourage new players from entering the market.
Nio previously shared its plan to release a vehicle in the second half of next year under the brand “Alps.”
The EV maker has faced financing challenges several times and has delayed investments due to dull deliveries, but the company subsequently received $740 million from an Abu Dhabi-backed fund. It recently announced a refinancing plan for a portion of its debt.
Zacks Rank & Key Picks
NIO currently carries a Zacks Rank #4 (Sell).
Some top-ranked players in the auto space include Li Auto LI, Gentex Corporation GNTX and Allison Transmission Holdings, Inc. ALSN, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LI’s 2023 sales and earnings implies year-over-year growth of 154.7% and 9,200%, respectively. The EPS estimate for 2023 and 2024 have moved north by 33 cents and 68 cents, respectively, in the past 60 days.
The Zacks Consensus Estimate for GNTX’s 2023 sales and earnings indicates year-over-year rises of 17.3% and 29.4%, respectively. The EPS estimates for 2023 and 2024 have moved up by 7 cents and 9 cents, respectively, in the past 60 days.
The Zacks Consensus Estimate for ALSN’s 2023 sales and earnings suggests year-over-year increases of 9.3% and 24.2%, respectively.
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