Nio, the Chinese electric vehicle manufacturer, has entered into a partnership with battery industry leader CATL to enhance the longevity of electric vehicle (EV) batteries, aiming to reduce overall EV costs.
According to William Li, Nio’s founder and CEO, the collaboration will integrate technologies from both entities to address the critical issue of reducing the “full life cycle” costs of batteries. This is crucial for the operational efficiency of Nio’s extensive network of battery-swapping and charging stations.
Li emphasized the significance of extending battery life, stating, “One of the most important problems that has fundamentally not been solved nor attracted widespread attention is battery life.” He stressed that solving this issue is not just imperative for Nio but for the entire EV industry.
Currently, EV battery warranties typically cover eight years. Nio highlighted that by 2025 to 2032, approximately 20 million EV battery warranties in China will expire, underscoring the challenge of battery longevity compared to the lifespan of cars and the high costs associated with battery replacement.
Nio has been actively engaged in research efforts to prolong the lifespan of swappable batteries, achieving an impressive retention of 80% capacity after 12 years. The company announced a significant reduction of up to 33% in monthly rental fees for batteries in its rental scheme, aiming to lower EV purchase costs by as much as $18,000.
Despite receiving substantial funding from Abu Dhabi investor CYVN Holdings last year, Nio remains committed to accelerating profitability by optimizing its workforce and deferring long-term investments, while continuing to invest in core technologies such as battery development.
Nio has made significant strides in battery technology, introducing 150 kWh semi-solid-state batteries for its EVs, manufactured by Beijing Welion New Energy, boasting a remarkable range of up to 1,000 km (620 miles).
The company has also invested heavily in battery charging and swapping infrastructure, currently operating over 2,300 swapping stations and more than 21,000 public charging stations. Although charging services have become profitable for Nio, the company still incurs losses in battery-swapping operations.
While some industry observers have questioned the cost-effectiveness of swapping stations, Nio sees them as a dual-purpose solution for quick EV charging and energy storage to enhance grid stability.
Looking ahead, Nio plans to introduce its second brand, Ledao, in May, as part of its strategy to diversify and target a broader consumer base. Nio continues to explore partnerships for battery supplies, alongside its existing collaboration with CATL, including potential engagements with new partners such as CALB.
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