Chinese EV start-up Nio launches smartphones unit week after CEO says carmaker to make mobiles for vehicle owners

  • Nio Mobile Technology was incorporated on Thursday, according to data provider Qichacha
  • The phones are expected to be part of Nio’s ecosystem, but it will struggle to compete with established brands, angel investor says

Chinese smart electric vehicle (EV) start-up Nio has set up a smartphone subsidiary with a registered capital of US$100 million.

Nio Mobile Technology was incorporated in Anting, Shanghai, where the carmaker is headquartered, on Thursday, according to data provider Qichacha. Nio declined to comment on its mobile phone business.

The establishment of the unit came after William Li, Nio’s co-founder and CEO, said last week that the carmaker aimed to develop a smartphone for its vehicle owners each year.

“The phones are expected to be part of Nio’s ecosystem and to be compatible with its EVs’ operating system,” said Yin Ran, an angel investor in Shanghai. “[But] it will be difficult for Nio, a carmaker, to design and make smartphones that can compete against established brands such as Apple and Xiaomi.”

The Shanghai EV maker, along with Guangzhou-based XPeng and Beijing-headquartered Li Auto, is regarded as China’s best response yet to US carmaker Tesla, which is the runaway leader in China’s premium EV segment. Their EVs feature high-performance batteries, some form of autonomous driving capabilities and sophisticated in-car entertainment systems.

All three start-ups are ramping up the development of technologies or digital products that can connect with their cars, as they try to gain ascendancy in the world’s largest EV market.

Qin Lihong, Nio’s co-founder and president, will be Nio Mobile Technology’s legal representative, according to Qichacha. In February, technology news site 36kr reported that the carmaker had moved into the smartphone business and recruited Yin Shuijun, a former president of Chinese beauty app Meitu, to head the division.

Li told Nio users on July 28 at an event in Fuzhou, in China’s eastern Fujian province, that the company would launch a new phone every year. He also admitted that this would be an uphill task for Nio. The event was broadcast live via the internet.

Nio has a history of incorporating hi-tech gadgetry in its cars – in December last year, it launched its ET5 sedan with a digital cockpit that boasts of augmented reality (AR) and virtual reality (VR) technologies.

It is indeed not the first carmaker to meld AR and VR technologies into an EV, but its move to create an immersive indoor experience with its “PanoCinema” feature is expected to be a game changer at a time when huge screens are seen as hallmarks of premium battery-powered vehicles, analysts said.

The Shanghai carmaker is also developing mass-market cars priced between 100,000 yuan (US$14,808) and 200,000 yuan to challenge the likes of Volkswagen and Toyota amid growing demand for battery-powered automobiles in China. Nio currently only builds luxury EVs.

Author: Daniel Ren, SCMP

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