NIO Capital invests in the luxury off-road EV industry. Zhixing, a separate brand planned by Nio Capital, concentrates on developing luxury off-road electric vehicles. The launch of its first model in 2025 has a price of roughly RMB 1 million ($150,000), as reported by Technode, a media source on China’s technology and startup scene.
Why Make the Investment? Because of the strong demand from wealthy individuals.
Despite broader economic difficulties, experts predict that wealthy consumers will continue to have a strong demand for luxury EVs in the upcoming years, with more Chinese automakers entering the profitable industry, Technode reported.
According to a report of Technode, a July 8 analysis from McKinsey & Company, the global markets for luxury cars above $80,000 would rise at a compound annual growth rate of 8% to 14% through 2031, while those below $80,000 may see relatively flat global markets.
The Purpose of Nio’s Investment
Technode reported that this movement from Nio can:
- Enable Nio to expand its market reach by managing a growing portfolio of focused brands
- Penetrate a more expensive sector
- Even strengthen the existing strong reputation the EV maker has among China’s upper middle class
About Zhixing
Technode report cited unnamed sources, and stated that:
- Zhixing is an EV startup created in early 2022
- Zhixing would acquire dozens of millions of dollars from Nio Capital, a venture capital company founded by William Li.
Things to Know About Zhixing
Some significant facts on the EV startup.
- Zhixing is a separate brand by Nio Capital
- Zhixing plans to introduce its first model both domestically and for the international market in 2025.
- The EV startup aims to appeal to wealthy and intrepid Chinese consumers.
- The sports utility vehicle will cost about RMB 1 million and be constructed on Nio’s third-generation NT platform.
- Nio and Zhixing will work together on the supply chain and charging infrastructure. The collaboration could result in significant development in cost savings for the company.
- In order to access Nio’s charging network, the vehicles will have a swappable battery pack and an 800-volt battery system for ultra-fast charging.
- Founded by Zhao Lei, a former senior director of user experience operation at Li Auto, Zhixing. The organization is establishing teams across China, the USA, and Europe. It has hired Roger Malkusson, a former VP in vehicle engineering at NIO, as head of Europe.
- Zhao Lei, a former senior director of Li Auto’s user experience division, founded Zhixing.
- The company is building teams in China, Europe, and America. Roger Malkusson, a former vice president of vehicle engineering at Nio, is appointed as the head of the Europe branch.
According to the Chinese corporate information website Tianyancha, Zhao formally established Zhixing (Beijing) Information Technology Co., Ltd. on September 27 with a registered capital of RMB 100 million.
Automakers Who Have Made Similar Investments
- BYD – On January 5, the company debuted its first two luxury vehicle models under the new Yangwang brand. The first quarter of 2019 will see the opening of distinct showrooms for the brand in several Chinese cities.
- GAC – The company’s first sports car under the Hyper brand would start at RMB 1.29 million.
- Geely – In 2017, the completion of Geely’s majority acquisition of the British sports car manufacturer Lotus happened. In October of last year, the automaker debuted the Electre, an electric SUV with a starting price of RMB 828,000. Nio Capital also owns a small portion of Lotus.
- Nio- Joining the affordable EV segment, the company has plans to create two sub-brands to attract more price-sensitive clients with a budget under RMB 300,000, while Nio’s namesake brand falls in the center with a price range between RMB 300,000 and RMB 500,000.
