This article ** is from Dolphin Finance.
On December 5, NIO announced its 2023Q3 financial report, and its stock price rose and fell for two consecutive days. Although the financial performance was better than the previous quarterly report, it did not exceed market expectations. In addition, NIO has recently come up with "one winter cotton coat after another": laying off at least 10% of employees, opening up the battery swap business, reducing the price of models, trying the dealer model, canceling the right to free battery swaps, and even letting go of the wind "does not rule out independent financing of the battery swap business". All actions point to only one: to survive with a broken tail, reduce costs and increase efficiency. It is not difficult to see from this that NIO really can't afford to lose. And all kinds of signs also show that NIO seems to be far from seeing the future.
Deliveries were lower than planned, and losses widened
According to the financial report, in 2023Q3, NIO will achieve revenue of about 1906.7 billion yuan, a year-on-year increase of 466%, an increase of 117 month-on-month4%。The cumulative revenue in the first three quarters of 2023 is 3851.5 billion yuan, with a cumulative revenue of 332 in the same period last year0.5 billion yuan, a year-on-year increase of 1599%。
Although Q3 revenue increased, the net loss was still as high as 455.7 billion yuan, a year-on-year increase of 108%；In the first three quarters of 2023, it has accumulated a net loss of 1535.2 billion yuan, with a cumulative net loss of 86 in the same period last year5.1 billion yuan, an increase of 77 percent year-on-year46%。
NIO's 2023Q3 key financial information
According to the financial report data, from 2018 to the third quarter of 2023, NIO has accumulated a loss of nearly 81 billion yuan. Among them, from 2018 to 2022, NIO's net loss was 2332.8 billion yuan, 1141.3 billion yuan, 561.1 billion yuan, 1057.2 billion and 1455.9 billion yuan.
In addition to continuous losses, NIO's sales target is also hopeless. Li Bin, founder of NIO, once said that the annual sales target for 2023 should be doubled year-on-year. Press last year 12Annual sales of 250,000 unitsNIO's annual sales target for 2023 should be 2450,000 units, while NIO delivered a total of 14 new cars from January to November20,000 vehicles, with one month left, what will Li Bin do to fill the hole of more than 100,000 vehicles?
On the other hand, Li Auto in "Wei Xiaoli" has delivered a total of 325,677 units by the end of November, reaching the sales target of 300,000 units in 2023 ahead of schedule. Xpeng Motors, on the other hand, had delivered a total of 121,486 units by the end of November, surpassing NIO in November, although it still lagged behind NIO in overall sales. It's no wonder that the market joked that "the former Wei Xiaoli should now be called Li Xiaowei".
The free battery swap mode has come to an end
In the face of losses, Li Bin used to firmly believe in long-termism, believing that his strategy of "high-end service" for car owners would one day prove itself. However, under the pressure of continuous losses, Li Bin's attitude is changing.
In an internal speech in late November, Li Bin said: Do not oppose the long-term and short-term, the basis of long-termism is that short-term implementation must be in place. In the current environment, the risks of long-termism have increased and the rewards have decreased. While adhering to the company's mission and values, it is necessary to actively respond to market changes with short-term actions.
Li Bin's subtext is very clear: NIO must reduce costs and increase efficiency, and the first thing to do is to plug the bleeding point.
NIO's free battery swap model, which has been repeatedly questioned by the outside world, is undoubtedly the first target to be cut. Compared with the charging mode, the convenience of the battery swap mode is self-evident: its average battery swap time is only 3-5 minutes, which is far better than the time required for charging at this stage. But for businesses,The huge construction investment and operating costs of the battery swap mode are unbearable.
NIO battery swap station (data**).
According to the data, as of December 5, NIO has deployed a total of 2,226 battery swap stations around the world, including 694 domestic highway battery swap stations. According to the China Post ** research report, the second-generation station equipment investment of NIO is about 1.5 million yuan, the battery investment is 1 million yuan (13 75kWh or 100kWh batteries), the electricity cost (assuming 30 times a day service), the total rental cost and labor cost reach 1 million yuan, and the total cost is about 3.5 million yuan (the cost of the first-generation station is about 3.46 million yuan).
In terms of construction input costs, NIO has invested about 5.5 billion yuan in 2,226 battery swap stations, and will still need to invest about 2.2 billion yuan in operating costs such as electricity and personnel in the future. Considering the current limited sales volume and ownership of NIO, the investment in charging stations is likely to be a bottomless pit. According to NIO's official data, as of November 30, 2023, its cumulative deliveries were 431,582 units. In the future, with the increase in NIO's vehicle deliveries, this investment will rise. If NIO is unable to increase its investment in battery swap stations at the same time, the user experience will decline, which in turn will impact the sales side.
In fact, in order to hedge the huge cost burden of the battery swap model, NIO has adjusted the rights and interests of relevant users many times. In August 2019, NIO launched an unlimited number of free battery swaps. With the continuous expansion of the user scale, NIO has begun to continuously reduce the free battery swap service. First, the number of free battery swaps per month was adjusted to 6 times, and then to 4 times. In June this year, NIO further gave consumers a choice of two options: either the car price was reduced by 30,000 yuan, or the battery was replaced 4 times a month for free.
This shows that Weilai's model of attracting users through the free battery swap model has come to an end, and the financial burden makes it impossible for Weilai to continue to hold high the banner of "high-end service", and it is an inevitable trend that the rights and interests of users continue to shrink.
In addition to canceling free battery swaps, NIO has also further reduced costs and increased efficiency through layoffs.
In early November this year, NIO announced a 10% layoff. Interestingly, just one day before the official announcement of the layoffs, NIO also opened rumors of a 20% layoff. In early December, it was reported that NIO may intensify further layoffs, with some departments being asked to prepare a "follow-up layoff list" and possibly expanding the original layoff ratio to 20%-30%. In response, NIO said: "There is no plan to reduce employees and increase the weight, only dynamic optimization and adjustment." ”
NIO laid off 10% of its workforce.
Debt pressure is difficult to alleviate
NIO's third quarterly report saidThe company's cash reserves at the end of the third quarter were 45.2 billion, and the cash flow appeared to be abundant, but at the same time, its total liabilities also reached 827700 million, compared to 686 total liabilities at the end of last year200 million, and the debt continues to grow. As of the end of the third quarter of 2023, NIO's short-term borrowings were 48300 million, payables and bills of 281200 million, long-term borrowing spot of 52300 million, long-term borrowings 121600 million. The sum of these items alone has reached 503400 million, far more than 45.2 billion in cash in hand, debt repayment pressure is extremely high. In addition to long-term borrowings, NIO's short-term liabilities are also as high as 38 billion yuan. In the current loss situation, the money in the hands of NIO obviously cannot last long.
The example that is still fresh in the market is that in 2021, WM Motor had a first-class business supply crisis due to insolvency. If NIO's financial situation continues to deteriorate, will it also stage a ** business forced debt crisis?In the end, all this still depends on whether NIO can increase sales as soon as possible and achieve real profitability at the business level, only in this way can the market, investors, and merchants have enough confidence.
NIO's financial report for the third quarter of 2023.
In addition, NIO obtained 11US$500 million, of which $500 million was repaid at 0% and 0.0 percent respectively5% of two old debts. It is worth noting that the interest rates of NIO's new bonds are 3875% and 4625%, the financial cost has increased significantly.
In the secondary market, NIO's share price has continued to fall, from a high of $66 to about $7 today, a drop of nearly 90%. The market value has also fallen from nearly $100 billion to more than $13 billion at present. For NIO, which mainly relies on financing to survive, the difficulty and cost of financing will become higher and higher in the future.
Dolphin Finance noticed that NIO's profitability is also worrying. According to the third-quarter financial report, NIO's gross profit was RMB 1523.3 billion yuan, down 122%。Among them, the main automobile sales, the profit margin in 2023Q3 is 110%, compared to 16 in the year-ago quarter4%。The above data shows that NIO's overall profitability is still in a state of deterioration.
Cost has been a huge issue plaguing NIO's bottom line. Over the past few years, NIO's operating costs have remained high. In the third quarter of 2023, NIO's cost of sales was 1754.3 billion yuan, a year-on-year increase of 557%, an increase of 1020%；The administrative cost is 360.9 billion yuan, a year-on-year increase of 331%, a month-on-month increase of 263%。This has further increased the pressure on NIO to improve its earnings.
In addition to the cost of sales, manufacturing costs, R&D costs, etc., have become important factors dragging down NIO's profitability. In terms of manufacturing costs, NIO has previously entrusted JAC Motors to OEM, and on December 5, NIO announced the acquisition of the production equipment and assets of JAC's first advanced manufacturing base and the second advanced manufacturing base, and obtained independent car manufacturing qualifications. Li Bin said: "From a manufacturing point of view, if NIO were to manufacture completely independently, the manufacturing cost would drop by 10%. "But it will obviously take time for the real manufacturing cost to fall, and before that, NIO will need to pay about 31 in a lump sum$600 million in acquisition costs. In the short term, this move further drained NIO's cash flow.
In terms of R&D, NIO has always been known for daring to spend money. According to the financial report, NIO's R&D investment in 2023Q3 will be 30400 million yuan, a year-on-year increase of 32%, down 91%。Among them, the month-on-month decline came from the support of local **. In the same period, among the three brothers of Li Xiaowei, the ideal was 28200 million yuan, Xiaopeng is only 1.5 billion yuan. In terms of R&D expense ratio, Xpeng was 176%, and NIO is 159% and 8 ideal1%。In the past two quarters, NIO's R&D expense ratio was as high as 38%. By 2023Q3, NIO has invested more than 3 billion yuan in R&D for four consecutive quarters. In terms of R&D money, NIO does surpass the other two brothers by several positions.
On the one hand, the market competition is intensifying, and on the other hand, there is a continuous debt investment that has to be borrowed. Today's NIO is facing high losses, financial pressure, debt default and other dangers, in the first half of this year, the market has **: if this year and next year NIO is still losing about 14 billion yuan per year (the first three quarters of this year have lost 153.).5.2 billion yuan), and cannot get a large amount of financing, and its cash will only be enough to support about 1 year, when the crisis will appear.
At the end of 2023, NIO seems to be in the predicament before the end of 2019 was on the verge of bankruptcy. Recently, Li Bin mentioned in public that NIO, whose life was hanging by a thread in 2019, was rescued from the intensive care unit in Hefei. At the beginning, Hefei became the big winner of the new energy automobile industry in one fell swoop because of its decisive attack, and it was also known as the most discerning place. But now, things have changed, and the competition pattern of the new energy market has undergone earth-shaking changes
In the face of external doubts, Qin Lihong, president of Weilai Automobile, personally retorted, "Weilai Automobile will not go bankrupt, and there is no possibility of bankruptcy." Li Bin also publicly said that the next competition will be more fierce than imagined, and the qualifying round has entered the final stage. He added: "It's very important to look at the return on our investment in terms of how long it takes. ”
However, it is still unknown whether NIO will be able to support the moment when investors can see a good return on investment.