2024.05.15 15:13
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Nio formally launches Onvo sub-brand, 1st model L60 to challenge Tesla Model Y

Nio has launched its Onvo sub-brand and started pre-sales of its first model, the L60, to compete with Tesla's Model Y. The L60 is priced at RMB 219,900 ($30,440), RMB 30,000 lower than the Model Y, and will be available for delivery in September. Onvo, which focuses on the mass market, benefits from Nio's R&D investment and has developed competitive advantages in various areas. The L60 is built on a high-voltage architecture and boasts high energy efficiency and low wind resistance. It also supports battery swap and has a range of up to 1,000 kilometers.

Onvo has begun pre-sales of the L60 at RMB 219,900 ($30,440), RMB 30,000 less than the Tesla Model Y. The L60 will hit the market and begin deliveries in September.

(Image credit: Onvo)

Nio (NYSE: NIO) has officially launched its Onvo (Ledao in China) sub-brand and started pre-sales of the new brand's first model, the L60, to challenge Tesla's (NASDAQ: TSLA) hot-selling Model Y.

The Chinese electric vehicle (EV) maker launched the Onvo brand today in Shanghai, where it has its global headquarters, kicking off a multi-brand development.

Onvo is a sub-brand internally codenamed Alps, targeting the mass market, while Nio has another sub-brand internally codenamed Firefly, targeting the lower-priced market.

Onvo is derived from “On Voyage,” and its Chinese name “Ledao” translates to “Path to Happiness,” focusing on families.

The president of the new brand is Ai Tiecheng, who was previously an executive at Disney.

Onvo, which started three years ago, has developed a complete set of system capabilities and is further empowered by Nio's capabilities and resources accumulated over the past 10 years, said William Li, founder, chairman and CEO of Nio, at today's launch.

Benefiting from Nio's R&D investment of over RMB 43 billion, Onvo has developed competitive advantages in R&D, supply chain, manufacturing, quality, charging and battery swap network, sales and service network, Nio said.

Onvo gave the L60 its debut at today's launch event, a crossover that directly targets the Tesla Model Y, but at a lower price.

The Onvo L60 is built on a 900 V high-voltage architecture, with higher voltage leading to higher energy efficiency.

The model has an CLTC energy efficiency of 92.3 percent and has the lowest wind resistance of any production SUV in the world at 0.229 Cd, giving it an energy consumption of just 12.1kWh per 100km, Onvo said.

The model appears to be the first production vehicle of Nio's next-generation vehicle platform, NT 3.0, although the EV maker is downplaying the vehicle platform narrative.

Nio's ET9, unveiled at its Nio Day 2023 event on December 23, 2023, is also based on the 900 V high-voltage architecture, with deliveries set to begin in the first quarter of 2025.

Nio's current models on sale, as well as Tesla's Model Y, are built on the regular 400 V platform.

Onvo began accepting customer pre-orders for the L60 at the end of today's launch, with the model's pre-order price, including the battery, set at RMB 219,900 ($30,440).

The Nio sub-brand emphasized that the pre-sale price is exactly RMB 30,000 less than the current starting price of the Tesla Model Y in China.

Customers who pay RMB 2,000 to pre-order the L60 now can offset RMB 6,000 off the purchase price of the car.

The L60 will officially go on sale and begin deliveries in September, Onvo said at today's launch.

Like Nio's models, the Onvo L60 supports battery swap, which not only allows it to get a fully charged battery in as little as several minuts, but also makes it possible to make the purchase threshold lower.

Onvo hasn't announced a starting price for the L60 that doesn't include a battery pack, and Nio's vehicles see their starting prices drop at least 70,000 yuan under its BaaS (batter as a service) battery leasing model.

The L60 will have more than 1,000 battery swap stations available at its birth, Onvo said. That means Nio will have about half of its current stations adapted to support the model.

As of today, Nio has 2,415 battery swap stations in China, 798 of which are located along highways, according to data compiled by CnEVPost. It also has 3,841 charging stations offering 24,036 charging piles.

The Onvo L60 is a mid-size SUV with length, width and height of 4,828 mm, 1,930 mm and 1,616 mm respectively, and a wheelbase of 2,950 mm.

For comparison, the Tesla Model Y measures 4,750 mm in length, 1,921 mm in width and 1,624 mm in height, with a wheelbase of 2,890 mm.

Onvo has not released information on the L60's battery pack, but said the model has a CLTC range of 555 kilometers for the standard-range version and over 730 kilometers for the long-range version.

Like Nio models, the L60 will be available with an ultra-long-range battery pack, resulting in a range of more than 1,000 kilometers.

Nio has already started trial operation of its 150-kWh semi-solid battery packs that can give the ET7 sedan more than 1,000 kilometers of range.

Unlike Nio models' assisted driving system that uses cameras plus LiDAR solution, the Onvo L60 removes the LiDAR from the center of the roof but retains the cameras on both sides of the roof.

Notably, Onvo has added a 4D imaging radar to the L60 that current Nio models don't have, resulting in better obstacle recognition than the cameras.

The maker of that 4D imaging radar -- the SFR-2K -- is local startup SinPro, which received an investment in April 2023 from Nio Capital.

The SFR-2K will be standard on all models of Nio's NT 3.0 platform, SinPro said in a statement today, adding that apart from the Onvo L60, the Nio ET9 also carries the component.

The Onvo L60 carries an Nvidia Orin X chip to power its assisted driving system, capable of delivering 254 Tops of computing power.

Current Nio models come standard with four Orin X chips, totaling 1,016 Tops.

The Onvo L60 has a horizontal 17.2-inch center screen, unlike Nio models' vertical screen.

The model doesn't have a dashboard like Nio models, but keeps the HUD (Heads Up Display) system.

The Onvo L60 will go head-to-head with the Model Y, the Tesla SUV that is not only a hot seller in China, but also one of the best-selling in the world.

For all of 2023, the Model Y sold 456,394 units in China, contributing 75.6 percent of Tesla's entire 603,664 sales in the country.

In March, Li said at a communication event with users that those wishing to buy the Model Y could wait for a while, and that the first model from Alps (Onvo) will certainly be cheaper and better.

However, challenging the Model Y won't be easy. The Chinese EV market has seen a number of Model Y rivals over the past few years, but so far none of them have threatened the Tesla model's position.

In the January-April period, the Model Y sold 126,722 vehicles in China, which is comparable to the Nio's sales in the first 10 months of 2023 and higher than Xpeng's (NYSE: XPEV) sales in the first 11 months of last year.

What may be a wild card for the L60 is BaaS pricing. If Onvo offers a much lower starting price without batteries and very attractive battery rental fees, things could be very different.

($1 = RMB 7.2243)

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