Nio shifts attention to short-range from long-range battery

BERLIN -- Chinese electric startup Nio caused a stir when it announced its ultra-long-range battery in early 2021.

Now the company is downplaying the 155-kilowatt-hour battery’s significance and says its customers are actually asking for cheaper, shorter-range batteries that fulfill their range needs at a lower price.

Nio is still working on its 155-kWh pack, which it says is “part solid-state,” referring to the energy-dense but still-unproven future battery chemistry.

However, it has delayed that battery pack’s launch in China from late this year to the first quarter of 2023, Fei Shen, head of Nio Power, said on the sidelines of the company’s German market launch event here earlier this month.

When it arrives, the company believe the 155-kWh pack will cause more of a stir among the media than its customers.

“Personally, I don’t think this battery will be widely used,” Shen said. “In China they more often ask us when we will deliver a small capacity battery.”

Smaller capacity means a smaller monthly bill for current Nio owners as well has new customers thanks to Nio’s battery-swapping technology.

Nio operates a leasing system for its batteries with the cost based on the capacity of the battery, meaning customers favor the lowest capacity to meet their daily needs.

“Most users buy or lease our standard battery, which is 75 kWh, and when they need to travel longer distances, such as when they are on holiday, they can upgrade their battery to 100 kWh,” Shen said, referring to the two sizes Nio offers.

Far from pushing its customers into bigger batteries, Nio encourages them to go with one that meets their needs.

“If a user chooses the 155-kWh battery and then mostly drives in city centers, we don’t consider this the highest efficiency,” Shen said.

The rising cost of battery materials is causing more automakers to investigate using cheaper chemistries and also to utilize capacity more efficiently, something Nio reckons it has done by embracing battery swapping.

“By offering this flexibility and upgradeability to our customers we can reduce demand for materials by 17 percent,” Nio co-founder and CEO William Li said at the event.

Nio is responding to the wishes of its customers for a lower-cost solution by developing a 60-kWh pack with the same compatibility that also cuts costs by using lithium-ion phosphate (LFP) chemistry.

LFP started out as a more prosaic choice for commercial vehicles such as buses in China but is slowly growing in popularity among car companies, including premium brands such as Tesla.

Li said the pack would also be “more affordable for mass market brands” as part of its pitch for automakers to adopt its battery-swap platform and help expand its swap network, currently up to 1,158 locations in China, with 120 planned for Europe by the end of 2023.