Nio Stalls in Germany As Its Car Registrations Fall 93.6% in July

Chinese carmakers are gaining ground in Germany, Europe’s biggest car market. But Nio, the Chinese brand known for its battery-swapping system and premium electric-vehicle image, has registered just 18 cars there so far this year.

In July, Nio registered three cars in Germany, down 93.6 per cent from a year earlier. It was the third consecutive month at that level, leaving its registrations in the first seven months nearly 90 per cent lower, according to the German Federal Motor Transport Authority (KBA) last week.

By contrast, some of Nio’s Chinese peers are seeing explosive growth in Europe’s biggest economy. BYD registered 5,240 cars in July, up 365 per cent from a year earlier. Xpeng, another mid- to premium-market brand, registered 1,253. Meanwhile, Germany’s battery-electric market grew 61.7 per cent to 78,609 cars.

The weakness extends beyond Germany. Nio registered only two cars in the Netherlands in July, according to Dutch industry body BOVAG. Registration figures record the moment a vehicle is licensed, and may not fully reflect sales under subscription models.

A spokesperson from Nio said the company remains committed to developing its business in Europe, supporting its users, and strengthening its research and development capabilities and local presence.

“Nio has no plans to retreat from Europe,” the spokesperson said.

Beatrix Keim, director of Centre Automotive Research, a German automotive think tank, said Nio entered the market “too unknown, too high priced, with a strange system that was complicated, because the swapping stations were not set up, and later not in sufficient quantity”. In China, however, Nio is well known for its battery swapping strategy. Drivers pull into a station, where a machine replaces a depleted battery with a charged one in about five minutes. But in Europe, after nearly four years, it operates only around 20 swap stations in Germany, compared with almost 4,000 in China.

Building the stations has also proved slow and costly. A station in Germany took 10 months to build and sometimes as long as a year, Nio founder William Li said in March of last year. Most of Nio’s German stations are along motorways.

Separately, Nio takes a direct-sales model rather than working through local dealers, opening four Nio Houses – flagship stores that combine a showroom and community space – in Germany, including a three-storey site on one of Berlin’s most expensive shopping streets.

The costly strategy did not translate into reach among car buyers. “You need to be visible on the street, in communication and through dealerships, and easy to reach when something goes wrong – especially when your brand is unknown,” Keim said.

The company also closed its Hamburg Nio House on July 20, a 1,300-square-metre showroom on a prime shopping street that had opened just two years earlier.

Volkswagen has about 900 dealers in Germany. BYD, which had just 25 until September, now has about 120, she said, while Nio remained reliant on its own stores to sell cars.

Nevertheless, Nio has continued to expand in Europe, albeit with a more localised strategy.