(Yicai Global) May 28 -- Chinese electric car manufacturing startup Nio will obtain CNY10 billion (USD1.4 billion) funding in a round led by Beijing E-town International Investment and Development.
E-town is the investment platform of the Beijing Economic-Technological Development Area in the city's southern Daxing district.
Shanghai-based Nio will also offer funds and build a plant for production in the zone.
Nio already inked the framework contact on the investment with E-town this month, Yicai Global learned today from an insider with the electric carmaker.
Nio will set up a new entity, Nio China, for that purpose in the development area, per the agreement, and will also inject the specific business and assets into the newly-formed entity. The investment platform will offer CNY10 billion (USD1.4 billion) in cash to Nio China through its designated investment firm or in concert with other investors to obtain rights and interests as Nio China's non-controller.
E-town will also help Nio China build its vehicle production Beijing production base independently or by introducing a third-party investor, to enable Nio to produce its second-generation car models. The plant's scheduled production scale and investment amount still remain unknown, however.
Nio listed on the New York Stock Exchange [NYSE:NIO] in September, raising funds of USD 1 billion. Hefei-based JAC Motors previously played the role of the electric carmaker's original equipment manufacturer and was mainly responsible for producing its vehicles. Nio announced its construction of a plant in Shanghai in October but canceled it in March.
The firm's revenue reached about CNY1.6 billion (USD243 million) in the first quarter, down 52.5 percent from the previous one, and swallowed a net loss of about CNY2.6 billion (USD391 million) in the period, a drop of 25 percent from the quarter before, but a 71.4 percent rise from the same time last year, its unaudited earnings report that Nio released today shows.
It delivered 3,989 ES8 electric vehicles in the first quarter in a clear drop from the 7,980 in the fourth quarter. The delivery amount is predicted to fall steadily in the second quarter to between 2,800 and 3,200. NIO's car sales were CNY1.5 billion (USD229 million) in the quarter, down 55 percent to the fourth quarter, while its gross profit margin reached -7.2 percent, while that in the fourth quarter was 3.7 percent.
Editors: Tang Shihua, Ben Armour