Nio's Secret Sauce? Why Chinese EV Maker Is Poaching Sales Talent From BMW, Mercedes, Audi

Nio Inc NIO CEO William Li explained the intent behind hiring salespersons from other luxury brands like BMW, Mercedes, and Audi during the company’s second-quarter earnings call on Tuesday.

What Happened: Around June, Nio realized that it was lagging behind both in terms of the number of salespersons and the capability to sell products.

The size of the sales teams of luxury brands like BMW and Mercedes are six to seven times higher than Nio’s, Li said.

“Without sufficient personnel or touchpoint, we cannot realize a very good user satisfaction, good test drives or high conversion rate from these to orders,” he noted.

Hence, the company started to expand user touchpoints, sales channels, and the sales team in China to propel sales growth.

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“This is also why starting in July and August, we’ve been taking some active measures and actions in expanding our sales network and touchpoints, especially in lower-tier cities where we don’t have full-fledged facilities or stores,” he said.

“We hope to really secure and hire experienced and seasoned salespersons who have their networks and user bases already to help us with the sales test.”

Though the process of training personnel and finding locations takes time, Nio expects that it will help the company support new orders of 30,000 units per month.

Why It Matters: Last month, Nio delivered 20,462 units.

For the upcoming third quarter, the company expects to deliver between 55,000 and 57,000 units, up 74%-80.3% from the year-ago quarter. The company also expects third-quarter revenue of $2.61 billion to $2.69 billion, representing 45-50% year-over-year growth.

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Photo courtesy: Nio