Nio pauses production due to supply chain issues

The Chinese manufacturer Nio has stopped the production of its electric cars. Nio says that this is because the company’s suppliers in several places such as Jilin, Shanghai and Jiangsu have stopped production due to the effects of the pandemic.

Nio informed its customers of this via the company’s own app, saying that supply chains have been under pressure since the covid outbreak in March. “Due to these factors, NIO’s vehicle production has been suspended,” the company said, quoted by the Chinese news website CN EV Post. “There will be a delay in the delivery of vehicles for many customers in the near future, and we ask for your understanding.” Nio has not yet said how many customers will be affected and how long the delay will be. This is difficult to estimage since it is currently not even clear how long the production stop will last.

In February, the last full month before the Covid outbreak in China, Nio was able to build 6,131 vehicles, which is equivalent to about 220 vehicles a day. However, the lower numbers were also because the Chinese New Year fell in February. In January, the number of cars produced stood just over 300 per day.

Nio said it was working with suppliers to resume production as soon as possible. While deliveries are also expected to resume quickly, Covid requirements of local authorities are to be met at all times. Although Nio has its headquarters in Shanghai, a metropolis particularly affected by the lockdown, production is located in Hefei in Anhui province. There has been no lockdown in Hefei so far; the problem is a lack of components from suppliers in affected regions.

Probably the best-known example of a production stoppage due to the Covid 19 requirements is Tesla with its Giga Shanghai: after a brief interruption in mid-March, production was up and running again but the factory had to be closed again from 28 March. It is not clear when assembly lines at Gigafactory Shanghai will start up again. Tesla cannot produce around 2,000 Model 3 and Model y per day.


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