Nio (NYSE:NIO) stock is trading down 4% today despite an interesting announcement from Chairman William Li. Li stated that Nio has plans to produce an 800-volt battery pack in-house during the second half of 2024. Battery costs have risen for Nio during the second quarter after its agreement with battery supplier CATL was renewed.
During May, Nio announced that it had delivered 7,024 vehicles. Year-to-date, the Chinese electric vehicle (EV) company has delivered 37,866 vehicles, up 11.8% year-over-year. Nio is slowly recovering from mass lockdowns in China due to the coronavirus. It has plans to “further ramp up the production capacity” by working with supply chain partners. This month, the company plans on accelerating “delivery recovery,” so delivery numbers for June will be highly anticipated.
With that in mind, let’s get into the details of the new battery packs.
NIO Stock: Nio Plans on Producing Battery Pack In 2024
Today, most electric vehicles carry 400-volt batteries. With Nio’s plans to produce 800-volt batteries, charging will be improved for its customers. This is because higher-voltage batteries allows a lower current to be used during the charging process. In addition, a higher-voltage battery “reduces overheating and allows better power retention in the system.”
Li also mentioned that Nio will plan to use a combination of in-house batteries and externally source batteries in the long run. This is similar to what Tesla (NASDAQ:TSLA) does with its batteries.
The new in-house batteries will be used for Nio’s new mass-market models, which are expected to be ready for sale during the second half of 2024. Li mentioned that these models are expected to be priced between $30,000 and $45,000.
Nio already operates battery-as-a-service (BaaS) swap stations in China. At these stations, customers can drive up and swap their batteries for a fully charged battery. Now, the company has plans to license out its BaaS technology to other automakers. The company seeks to take advantage of Tesla’s shortcomings, as Tesla released its own battery swapping technology in 2014 but ended the program. By 2025, Nio has a goal of operating over 1,000 battery swapping stations outside of China. By the end of 2030, it plans on operating 5,000 battery swapping stations globally.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.