An announcement for tender bids posted on ahtba.org.cn suggests that a new Nio model codenamed ‘Gemini’ is in the pipeline. The planned yearly production volume of 60,000 units indicates that it could be an entry-level Nio electric car with an LFP battery.
William Bin Li, Founder, Chairman, and CEO, Nio, has acknowledged the cost advantages of LFP batteries. He suggested that the company could offer it if shortcomings like reduced performance in low temperatures are overcome. In a market like Oslo, Norway, where Nio begins selling cars in September, LFP-equipped vehicles may not be suitable as temperatures in December, January, and February, usually fall below zero degrees centigrade.
During the Q1 2021 Earnings Conference Call last month, he said:
Of course, there are some inherent advantages of the LFP battery pack. A very important one is the cost. But there are also some weaknesses and shortcomings with this technology or form factor. For example, the performance of the battery pack in low temperature. This is going to significantly affect the user experience, especially during the winter. If we can solve the performance bottleneck under low temperature, I believe it should be the right timing and the right choice for us to use LFP battery pack and form factor.William Bin Li, Founder, Chairman, and CEO, Nio (Nio Q1 2021 Earnings Conference Call)
In other recent updates, a report from 36kr.com (via cnevpost.com) said that Nio plans to upgrade its 70 kWh battery pack by changing its chemistry to Lithium Iron Phosphate and increasing energy storage capacity to more than 75 kWh. The upgraded battery pack is currently in the second (B) stage of testing and validation (out of three stages A, B, and C), and it will be released in the fourth quarter of the year.
In January, a report from Yuguancheshi said that Nio had signed a deal for a lithium iron phosphate battery production line with CATL. The homegrown battery maker is the biggest name in its business by volume, and it is testing the new low-cost batteries for Nio, it was reported.
On the adoption of LFP batteries
Adopting LFP batteries might be seen as a regressive move by some. Still, its lower cost and stability compared with lithium-ion batteries have motivated automakers to bring them into their production line. Also, companies don’t want to put all their eggs in one basket. Cutting dependency on a single battery type or chemistry means more flexibility and fewer supply issues.
The report said that there’s no information about the Nio models that will get the lithium iron phosphate batteries, but the first launch should occur this year.
On May 24, 2021, Nio announced that JAC, its manufacturing partner that currently produces the ES8, ES6, and EC6, will increase the annual production capacity to 240,000 units. It confirmed that JAC plans to manufacture the ET7 and “potentially other Nio models in the pipeline’ as well. So, the same company may build the Nio Gemini entry-level model that is expected to feature an LFP battery.
Future Nio cars
Like Tesla and Xpeng, Nio plans to use lithium iron phosphate batteries to position entry-level electric cars at a more affordable price, it is reported. Besides lowering the price of existing models, a Nio ES4 compact SUV, along with a coupe cousin Nio EC4 and a compact sedan, could be future entry-level models that use LFP. Note that Nio has not confirmed names of future models, but it is logical to expect a top-down approach as Bin Li said during the Q3 earnings call in November that it does not intend to go above the ES8. He had stated that the next two launches (including the ET7) are sedans.
The lower cost LFP batteries could be aimed at making Nio cars a bit more accessible while preserving the premiumness of the brand. The European market, which welcomes the ES8 in September 2021, is expected to get the smaller Nio product offerings in the coming years.
Featured Image Source: Nio