Chinese EV start-ups Nio and Xpeng turn to the mass market for growth
BEIJING — Chinese electric car start-ups Nio and Xpeng are turning to a lower-priced segment of the market with plans to release newly branded cars this year.
Nio's first such mass market car will be an SUV cheaper than Tesla's Model Y, CEO William Li told CNBC's Eunice Yoon on Thursday. The Tesla SUV starts at 249,900 yuan ($35,197) in China.
Like many early entrants to China's electric car market, U.S.-listed Nio targeted the premium market when it launched about a decade ago. Its vehicles can cost around $50,000 or more, offering buyers additional services such as Nio clubhouses and a network of battery charging and swapping stations.
Nio and Xpeng's plans to launch mass market brands put the companies in more direct competition with local rival BYD and German carmakerVolkswagen.
The new cars come amid an intense price war in China's new energy car market, which includes battery-only and hybrid-powered vehicles. Such cars now account for well over 40% of new passenger cars sold in the country.
Li said he doesn't expect the main brand to significantly adjust prices, although he expects price volatility in the market to persist for a while.
Nio is planning a mid-May launch for its new brand, called Onvo or «Le Dao» in Chinese, a name the company says is meant to reflect families — the target consumer segment — having a happy time together.
Xpeng, which sells its cars in a slightly lower price range than Nio, plans to launch its new sub-brand Mona in the next two or three months, Vice Chairman and Co-President Brian Gu told CNBC on Thursday.
Gu said the new cars would sell for less than 150,000 yuan ($20,700), which is lower than the price range Nio is targeting. Last summer, Xpeng said it would develop a new mass
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