(Yicai Global) March 2 -- Nio's stock price plunged after the Chinese electric vehicle startup saw its net loss widen 259 percent and gross margin almost halve last year.

Nio [HKG: 9866] sank 13.2 percent to close at HKD69.20 (USD8.82) a share in Hong Kong today. In pre-market trading in New York, its stock [NYSE: NIO] was down 0.8 percent at USD8.76 as of 6.44 a.m. local time, after dropping 6 percent yesterday.

The net loss tallied CNY14.4 billion (USD2.1 billion) in the 12 months ended Dec. 31, mainly because of a 170 percent increase in the fourth quarter to CNY6.8 billion from a year earlier, the Shanghai-based firm's earning report showed yesterday. Annual revenue rose 36 percent to CNY49.3 billion (USD7.1 billion), with a 62.2 percent jump to CNY16.1 billion during the last quarter.

Nio's gross margin narrowed 8.5 percentage points to 10.4 percent in 2022, compared with Tesla's gross margin of 25.6 percent. The Chinese firm hit a record-low gross margin of 3.9 percent in the fourth quarter, versus 17.2 percent a year earlier, dragged down by a vehicle margin of 6.8 percent.

Vehicle margin is the margin of new vehicle sales, which is calculated based on revenue and cost of sales derived from new vehicle sales only, according to Nio.

Annual vehicle margin fell to 13.7 percent from 20.1 percent a year earlier, mainly because of increased inventory provisions, faster depreciation of production facilities, high battery costs, and loss on purchase commitments for its existing generation of ES8, ES6, and EC6 vehicles in the third and fourth quarters, Nio said.

The carmaker aims to bring its vehicle margin to between 18 percent and 20 percent by introducing more new products with a higher gross margin and lower production cost, helped by lower raw material prices, including for lithium batteries and chips, among others, William Li, founder, chairman and chief executive, said on an earnings conference call.

This year, Nio plans to deliver five new products based on Nio Technology Platform 2.0, deploy 1,000 more battery-swap stations, and toughen its competitive advantages in key areas of smart electric vehicles, according to Li, who noted that Nio's main business can break even.

Revenue is likely to jump 10 percent to 16.5 percent to between CNY10.9 billion and CNY11.5 billion this quarter, Nio predicted. It expects deliveries to increase 20 percent to 28 percent from a year ago to between 31000 and 33000 units.

Nio set a target of doubling sales to 250,000 this year from 2022, with eight models available by July. 

Editor: Martin Kadiev