Nio signs credit lines with local banks for €1.3Bn
Nio is moving on from crisis as the EV start-up secures fresh capital from banks in China. The company had signed credit lines with six domestic banks for a total of 10.4 billion yuan (around 1.3 billion euros) just days ago.
Chinese media localises the news firmly in Anhui province as all of Nio’s new financiers are branches of state-owned commercial banks from there, including the Bank of China, the Industrial and Commercial Bank of China and the China Construction Bank. The connection to Anhui is crucial in this context: In February, Nio signed a framework agreement with the government of Hefei, the capital city of Anhui province.
In this framework agreement, the company, which was under great pressure at the time, committed to building factories and research centres in the city. Originally, Nio’s plans envisaged a factory in Shanghai, later in Beijing. However, the cooperation with the city of Hefei also brought the company a financial commitment of ten billion yuan – which has now been implemented in the form of a credit line with local banks.
Even after the signing of the important framework agreement, Nio had expressed doubts about continuing operations in March when announcing its 2019 financial results, saying in a statement: “The Company’s continuous operation depends on the Company’s capability to obtain sufficient external equity or debt financing.” This should be secured for the time being.
In addition, Nio is celebrating the production of his 50,000th electric vehicle. The white ES8 came off the assembly line in Hefei, and Nio is currently building its vehicles in a joint venture with JAC. There were 783 days between the first and the 50,000th car, as Nio states via his WeChat account. The vehicles delivered so far have covered more than 800 million kilometres.
Overall, the company’s deliveries are currently increasing steadily. According to the Nio, June marked a new monthly record with 3,740 vehicles delivered, and they supplied 10,331 vehicles in the second quarter. Compared to the second quarter of 2019, this is an increase of 190.8 per cent.
With reporting by Sebastian Schaal.
caixinglobal.com, cgtn.com, nio.com (sales report)
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