Nio (NYSE: NIO ), the Chinese electric vehicle manufacturer, has announced its intentions to introduce its first self-designed mobile phone in late September. The company aims to enhance the allure of its vehicles by offering improved software and connectivity through this new venture.
"Our phone business is not to compete with those phone makers," founder and CEO William Li told investors.
Li played a pivotal role in spearheading the phone initiative, primarily aimed at the company's car owners.
“We would like to use the phone as a carrier to provide the best experience for our vehicle users," Li added.
This endeavor positions Nio as the latest addition to China's automotive manufacturers embracing the trend of introducing car systems that empower drivers to utilize their smartphones for tasks such as remotely unlocking doors, activating air-conditioning, and starting their vehicles, among other functions.
Last year, the creator of Zhejiang Geely Holding successfully acquired the smartphone manufacturer Meizu, with both companies expressing their intention to merge consumer electronics and travel services. Meanwhile, Huawei Technologies entered into collaborations with various automakers, including Seres Group, to incorporate its Harmony operating system into electric vehicles for enhanced functionality.
However, Nio's mobile phone project has sparked unease among certain investors, given the company's ongoing struggle with increasing losses and a decline in sales, which has been exacerbated by a pricing competition instigated by Tesla (NASDAQ: TSLA ) since January.
In the second quarter, Nio reported a net loss of 6.12 billion yuan ($839.51 million), a significant increase from the loss of 2.75 billion yuan recorded in the same period the previous year. As of June, the company possessed cash and cash equivalents totaling $4.3 billion and received a substantial investment of $1.1 billion in July from CYVN Holdings.
William Li, the CEO, revealed that Nio plans to introduce the inaugural model of its fresh electric vehicle brand, targeting the broader consumer market, during the latter half of 2024.
Shares of NIO are down 2.58% in pre-market trading Wednesday.
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