Chinese electric car brand Nio (NYSE:NIO) said Monday it is cutting prices for its cars by the equivalent of $4,200 effective immediately, and ending free battery swaps for new buyers.
The move is contrary to CEO William Li’s claim in April that Nio would not join a “price war.” Tesla and other electric car companies in China had cut prices earlier this year in a bid to attract buyers.
The price cuts also follow Li’s comments Friday that the company was delaying its capital expenditure and some research and development projects, according to a FactSet transcript of Nio’s first-quarter earnings call.
Li said the delay is part of an effort to address the impact on cash flow from fewer car deliveries.
The company reported cash and cash equivalents of 14.76 billion yuan ($2.07 billion) as of March, below what it disclosed for the end of 2021 and 2022.
The latest monthly figures show Nio’s deliveries fell to 6,155 cars in May, down from the first-quarter average of just over 10,000 vehicles a month. The monthly average in the fourth quarter was about 13,350 cars.
Looking ahead, Nio said that it aimed to deliver at least 20,000 cars a month in the second half of the year.
NIO progressed 80 cents, or 8.5% to $8.53 to begin Monday morning.
