NIO Says Raw Material Price Hikes Add Over RMB 10,000 to Per-Vehicle Costs; Vows Price Stability and Focus on Service Profitability

During NIO’s Q1 2026 earnings call, Li Bin, Founder, Chairman, and CEO of NIO, stated that rising raw material prices this year—particularly the surge in memory chip costs—have exerted significant cost pressure on the automotive industry, resulting in an average cost increase of over RMB 10,000 per vehicle for NIO. The company will continue to maintain stable product pricing, prioritizing brand positioning, emotional value for users, and overall competitiveness over sales volume as its primary operational goal. NIO CFO Qu Yu noted that the company’s other businesses—including after-sales services, maintenance, the NIO Mall, energy solutions, financial services, and NIO Life—have shown marked operational improvement since Q4 2025, achieving an overall gross margin exceeding 20% in Q1 2026. NIO aims to sustain a gross margin of approximately 20% for the full year and expects service- and community-related businesses to become a key profit growth driver alongside new vehicle sales, supported by growing user base and enhanced operational efficiency. Li Bin also highlighted that as NIO continues expanding its battery swap network, acceptance of battery electric vehicles (BEVs) is steadily increasing among consumers in lower-tier cities (Tier 3, 4, and 5). The company’s current and upcoming product lineup will further fuel NIO’s sustained momentum in China’s passenger vehicle market.