Another day, another new electric vehicle manufacturer going after industry giant Tesla. But NIO, an electric car start-up our of China, has a leg up on the competition.
NIO just released its all-electric ES8 SUV, putting it in direct competition with Tesla’s Model X. But there’s a big difference between the two luxury SUVs. Namely, price.
According to CNBC, NIO’s ES8 is about half the price of the Model X. The ES8 has a starting price of 448,000 Chinese yuan (or roughly $67,700), while the Model X runs for 836,000 yuan (or $126,470). And that’s before China’s EV subsidies are factored in, meaning NIO’s ES8 costs even less.
Such a massive price difference could undercut Tesla’s expansion in its biggest global market.
NIO founder and chairman William Li told CNBC that it would be hard to guess how the launch of their new vehicle would impact Tesla’s own sales, “Maybe Tesla will sell less… after our product is out. Or probably, because the whole market is growing, they will still maintain growth in sales. It’s hard to say.”
Tesla and NIO are set to compete in countries outside of China as well. In 2020, NIO plans to bring its autonomous EVs the the U.S., including its EP9 model, a vehicle that’s 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.
And to fund all this? The company is looking to draw investments to fund its ambitious plans, and as Bloomberg reports, NIO could launch an IPO in the U.S. as soon as next year.
The company, which saw a $1 billion investment from Chinese giant Tencent earlier this year, is also weighing a sale of a stake of its U.S. business for $300 or $400 million, which would value those operations at more than $1 billion.
NIO isn’t the only competition for Tesla in the EV market. Chevy, and Nissan both have all-electric models in the $30,000 range, and Porsche plans to release its Mission E model in 2019. Apart from established manufacturers, both Tesla and NIO have competition in both Xiaopeng Motors and Lucid Motors.
Competition aside, what NIO’s big news this week really says is that the EV market is heating up, which means this space is one to keep an eye on in 2018.