Chinese electric vehicle startup Nio Inc. NIO announced late Friday that it has struck a partnership with one of its strategic investors to foray into the Middle East and North Africa.
What Happened: Nio has tied up with Abu Dhabi-based CYVN Holdings to launch the Nio MENA in a bid to launch Nio-branded vehicles and vehicles from its subsidiary in the region, the Shanghai-based company said in a statement. This, according to the company, will expand its footprint and integrate further into the “global smart EV ecosystem.”
CYVN Holdings will support Nio with strategic investments for the expansion, which will start with UAE.
The company also plans to establish a state-of-the-art R&D center in Abu Dhabi, the capital city of UAE. This center will focus on “autonomous driving and artificial intelligence advancements, reinforcing NIO's global R&D capabilities and fostering technological innovation in the MENA region.”
Nio and CYVN Holdings plan to collaborate on a new EV project that will involve research, manufacturing, and future product launches. The EV startup would also work with its partners in Egypt to expand EV manufacturing in the country.
In December Nio closed a $2.2 billion equity investment from CYVN Investments RSC Ltd.
Jassem Mohamed Obaid Bu Ataba Alzaabi, Chairman of CYVN Holdings, said, “This partnership is a testament to our mutual commitment to fostering the strength of our strategic collaborations and achieving transformative goals in the smart mobility sector.”
Nio’s founder, Chairman and CEO William Li said, “Our collaboration with CYVN Holdings is a cornerstone in our strategy to enhance global accessibility to smart electric vehicles and to push the boundaries of technological innovation.”
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Why It’s Important: Nio is a manufacturer of premium EVs and it has recently entered the low-end of the market with its Onvo brand. Deliveries of the first vehicle launched by the sub-brand, codenamed L60, began in late September, and early uptake has been fairly strong.
This week, Nio reported strong September and record third-quarter deliveries despite the tough domestic EV market conditions marked by lackluster demand and cutthroat competition.
In late-September, the company said a trio of domestic strategic investors agreed to invest an aggregate of 3.3 billion yuan ($470.64 million) in cash in its subsidiary Nio China. Nio on its part said it would invest 10 billion yuan (about $1.43 billion) in cash to subscribe to the newly issued shares of Nio China. The latest investments would infuse the much-needed financing to pursue it expansion both in China and overseas.
Nio’s prospects in China also appear bright, given China has decided to copiously stimulate the domestic economy, potentially arming consumers with the much-needed cash to splurge.
The company currently sells EVs in European countries such as Norway, Sweden, Germany, and the Netherlands. The MENA partnership comes as the European Commission has voted in favor of up to 45% tariffs on imported Chinese EVs.
Price Action: Nio ended Friday’s session up 1.04% at $6.77, according to Benzinga Pro data.
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Photo courtesy: Nio
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