NIO Expects Vehicle Costs to Rise Another 2,000-3,000 Yuan in H2 Amid Raw-Material Pressures

NIO Inc. expects its per-vehicle production costs to rise an additional 2,000 to 3,000 yuan (approx. $280 to $420) in the second half of the year as memory chips, bulk commodities and battery materials continue to climb, the company's chief financial officer Qu Yu said during a semi-annual earnings call.

For the second quarter, NIO reported revenue of 32.14 billion yuan (approx. $4.46 billion), up 69.1 percent year over year. Combined gross margin came in at 18.4 percent, widening by 8.4 percentage points. Vehicle gross margin held at 18.5 percent even as raw-material costs surged, supported by strong sales of higher-margin models and further optimization of the cost structure, according to founder and CEO Li Bin.

"The pressure on the cost side this year has been significant," Qu Yu said. Since March, memory, bulk materials and battery costs have all risen, pushing the average per-vehicle cost up about 14,000 yuan (approx. $1,950) by the end of the second quarter compared with late last year. NIO's goal is to maintain second-quarter per-vehicle gross margin in the third and fourth quarters despite further material-cost increases.

Pricing Power Remains Intact

Li Bin pointed to NIO's pricing resilience as evidence that the brand is absorbing cost pressures without sacrificing margin. The NIO brand's average transaction price in China reached 406,000 yuan (approx. $56,400) in the second quarter, ranking first among mainstream premium brands, he said. The average transaction price climbed further to over 430,000 yuan (approx. $59,700) in July.

Other sales gross margin stood at 17.0 percent in the quarter, with service and community-related businesses continuing to contribute profit. For the third quarter, NIO guided deliveries of 108,000 to 111,000 vehicles, representing growth of 24.0 percent to 27.5 percent year over year. Revenue is projected at 33.29 billion to 34.05 billion yuan (approx. $4.62 billion to $4.73 billion), up 52.7 percent to 56.2 percent.

Swap Network Expansion

NIO also highlighted progress on its energy-infrastructure rollout. The company's fifth-generation battery-swap station can now handle all models across the NIO, Onvo and Firefly brands, covering vehicles from compact cars to full-size SUVs, Li Bin said. The automaker is leveraging its standardized, scaled energy-operating system to explore value-added businesses such as electricity trading, aiming to unlock further commercial value from its swap-model ecosystem.