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NIO-SW: Avg Cost Pressure Per Vehicle RMB10K+; Overall Prices to Remain Stable
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NIO-SW (09866.HK) CFO Stanley Qu noted that the risks arising from higher material costs in 1Q have not yet been fully reflected, as the group still has some material inventory to compensate the impact of price increases. However, looking at 2Q and the full year, the spike in bulk commodity prices since the beginning of this year has given rise to enormous cost pressure. This includes the upsurge in memory prices, as well as the increase in the prices of lithium carbonate, nickel, cobalt, and manganese, the key raw materials for batteries. On average, cost pressure per vehicle exceeds RMB10,000, Qu added. The group aims to maintain overall vehicle gross margin at 17-18%. Higher-priced and higher-margin models, ES8 and ES9, will continue to account for a relatively high proportion of total sales, contributing stronger gross profit. Founder, Chairman and CEO William Li added that raw material price hikes this year, particularly for memory chips, have exerted substantial pressure on the entire industry. The entire sector faces similar challenges, though competitive strategies may differ. NIO will maintain overall price stability and preserve comprehensive product and service competitiveness, said Li. It will not prioritize sales volume as the primary operating strategy, but instead pursue reasonable volume growth while placing greater emphasis on gross margin and overall EBIT targets, striking an appropriate balance. NIO will adhere to its own approach and business model in responding to cost increases. AASTOCKS Financial News |
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