NIO Gains Manufacturing Qualification & Buys Factories
On October 4th, 2023, NIO received independent vehicle production qualification, and on the 5th of October, 2023, NIO announced it had bought the assets related to the JAC–NIO joint manufacturing facilities from JAC. This is a major milestone in NIO history as it becomes a fully-fledged auto manufacturer in China.
NIO (蔚来) independent manufacturing qualification
Since May 2016, NIO has had a strategic cooperation framework with JAC (Jianghuai Automobile) to manufacture NIO vehicles and to jointly develop the Jianghuai NIO advanced manufacturing base. This agreement allowed NIO to use JAC’s independent manufacturing qualification that allowed it to manufacture and sell vehicles in China. China, which is known for having many automobile brands and manufacturers, has faced pressure to consolidate, and the independent manufacturing qualification has been seen as a measure to increase consolidation. Local automakers are required to have independent manufacturing qualification, which is issued by the National Development and Reform Commission.
NIO has now entered China’s Ministry of Industry and Information Technology’s (MIIT) Vehicle Manufacturing Enterprise Credit Information Management System, which means it will be able to produce cars under its own name. Previously, NIO was absent from the system and NIO vehicles were produced under its partner’s name, JAC.
Reports about NIO looking to gain independent manufacturing qualification status came as early as February 2023. Reports circled that NIO had acquired assets of a defunct manufacture in Chuzhou, Anhui, China — the Enterprise Chuzhou Changfeng Cheetah Enterprise (Leopaard/滁州长风猎豹企业). The factory would be used to produce vehicles from NIO sub-brand Firefly. In these reports, it was discussed that NIO, the Anhui provincial government, and other parties were working on ensuring NIO got independent manufacturing qualification status.
The location of a NIO production address in the government documents is NIO’s F2 plant in NIO park. The address is 299 Baita Road in the Hefei Economic and Technological Development Zone (经济技术开发区白塔路299号). As of 2023, NIO has two factories in Hefei, in collaboration with JAC, the first being an upgraded/converted JAC factory F1 opened in 2018, the second being F2 in NIO park, which opened in 2022.
With NIO gaining independent manufacturing qualification status, it is the last of the major smart electric vehicle startups to gain the qualification. Xpeng and Li Auto being the others. NIO has not yet announced details or official information on this development, but on 23rd December, 2023, in Xi’an, Shaanxi province, China, NIO will be holding its annual NIO Day, which will likely be the venue at which it will announce details as part of a wider event where NIO will also unveil a new flagship model.
NIO buys JAC plant assets
On November 7, 2023, JAC listed three asset packages on the Anhui Assets and Equity Exchange website. On the December 5, 2023, it was announced that NIO bought these assets for RMB 3.16 billion yuan ($442 million).
NIO bought the factory assets of its vehicle manufacturing partner JAC, which with its independent manufacturing qualification status paves the way for it to manage manufacturing itself.
Of the three asset packages listed by JAC, NIO became the buyer of two assets with the combined transaction price of RMB 3.16 billion yuan ($442 million). The other asset was purchased by Hefei Hengchuang Intelligent Technology Co., Ltd for RMB 1.42 billion ($198 million). Hefei Hengchuang Intelligent Technology was a state-owned development company focused on industrial parks. This information was announced by JAC in a stock exchange announcement.
The asset packages purchased can be split into plant assets, equipment, buildings, and land use rights. NIO purchased planet assets and Hefei Hengchuang purchased buildings and land use rights, which fits the profiles of each company. NIO confirmed the deal in its third quarter earnings report.
The report stated: “On December 5, 2023, the Company entered into definitive agreements with Anhui Jianghuai Automobile Group Corp., Ltd. (‘JAC’) regarding the acquisition of certain manufacturing equipment and assets. JAC is a major state-owned automobile manufacturer in China that currently jointly manufactures with NIO all of NIO’s current vehicle models. Pursuant to the definitive agreements, the Company will acquire the manufacturing equipment and assets of the first advanced manufacturing base and the second advanced manufacturing base from JAC for a total consideration of approximately RMB 3.16 billion, excluding tax.” Note, JAC is used both for the car/van/truck company Jianghuai Automobile and the Anhui Jianghuai Automobile Group, which owns Jianghuai Automobile, and Ankai a bus manufacturer.
Reports in the local media have been highlighting NIO as the most likely buyer, with discussions around increasingly diverse partners in electric vehicles and NIO growth as drivers for this move.
NIO current layout
NIO since it now has both independent manufacturing qualification status and purchase production status of F1, F2 factories, its current/planned Chinese production layout can be seen as this:
NIO F1 (JAC-NIO Advanced Manufacturing Center): Located in the Baohe district, a southern district of Hefei, Anhui, China, it produces the NIO models: ES8, ES6, ES7, EC6, ET7.
NIO F2 (NIO Park): Located in the Shushan district, a far northern district of Hefei, Anhui, China, it produces the NIO models: ES8, ES6, ES7, EC6, ET7, ET5.
NIO F3 (NIO Park): Reportedly to be located in the Shushan district, a far northern district of Hefei, Anhui, China, it will be partly responsible for the production of the NIO sub-brand “Alpine” according to local reports.
NIO F4 (Chuzhou Economic and Technological Development Zone): Reportedly, it is to be located in the Langya District, in the Chuzhou Economic and Technological Development Zone, of Chuzhou, Anhui Province, China. This is reportedly going to be responsible for the NIO sub-brand “Firefly.”
Currently, F3 and F4 are not officially announced, so it is possible that this information is incorrect, old, or fabricated in the local news sources.
The current NIO lineup is:
- ES8 2023
- ES7 2023
- ES6 2023
- EC7 2023
- ET7 2023
- ET5 2023
- ET5T 2023
- EC6 2023
For more updates on NIO and China’s green development, stay tuned to CleanTechnica.
Note: $1 = RMB 7.16 (as of writing)
Sources:
- Ministry of Industry and Information Technology of the People’s Republic of China
- Shanghai Securities News
- NIO
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