Chinese EV maker NIO is denying rumors of a second round of layoffs circulating on social media. The speculation comes as several EV makers recently announced plans to scale back.
NIO announced in November it was trimming its staff by 10% amid “fierce competition,” according to a memo reviewed by Bloomberg.
The letter from CEO William Li said the company was eliminating duplicate and inefficient roles. Furthermore, projects not expected to generate earnings within the next three years were delayed or omitted from the plans.
“This is a tough but necessary decision against fierce competition,” Li said, adding, “Our journey is a marathon on a muddy track.”
NIO’s job cuts came after market leaders like Tesla and BYD aggressively slashed prices all year. NIO cut prices by up to $4,200 in June as it looked to keep pace.
After opening orders for the new ET7 this week, all NIO models are now underpinned by its updated NT 2.0 platform.
NIO clarifies no new layoffs are planned
After reports of a new round of layoffs began circulating, NIO set the record straight. The rumors were started by foreign bloggers, making their way to Chinese social media.
The rumors claimed NIO was implementing another round of layoffs. Reports cited falling sales and increased competition. Li said he was unaware of the situation.
Rising competition and higher interest rates are making it harder for EV makers to compete. Several automakers have announced plans to reduce their workforce or scale back.
Rivian announced plans to cut another 1% of jobs after revealing it was laying off 10% of its salaried employees in February.
The news comes after Tesla revealed it was reducing its global workforce by over 10% this week.
Meanwhile, NIO’s sales rebounded in March as new models launched. NIO delivered 11,866 vehicles in March (its highest monthly total in 2024) for 30,053 in the first quarter.
NIO topped estimates after trimming delivery forecasts just days before the release. Refreshed models like the 2024 ES8, ES6, EC6, and ET5T fueled the growth.
The EV maker expects the momentum to continue in the second quarter with the 2024 ES7, ET7, and ET5 rolling out.
NIO’s (NYSE: NIO) stock is down over 50% this year as the EV sector has slipped into a downward trend. NIO shares are down over 90% from the all-time high of over $62 set in February 2021.
Source: CnEVPost, NIO
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