Is Chinese electric car whiz kid NIO about to open a factory in the U.S.A.?

Business & Technology

With the ambition to expand its footprint globally, the Chinese electric car upstart is considering building a factory in the United States.

Image by Derek Zheng

Shanghai-based electric car brand NIO 蔚来汽车 is recruiting manufacturing-related staff in the United States, per Chinese media outlet Yicai. The move has raised a flurry of speculation that NIO intends to open a factory in America, but the company has offered no further disclosure.

NIO laid out the desired skills and experience that candidates should possess in job descriptions that mention experience in blueprint planning, design of original equipment manufacturing facilities, auto manufacturing in industrial parks, as well as knowledge of different American state policies on electric vehicles (EVs), design standards, and approval processes.

According to Yicai, the plant reportedly will assemble cars from either completely knocked down (CKD) or semi-knocked down (SKD) kits; i.e., the components will be delivered in parts, or partially put together in parts. The kits will presumably be manufactured in China.

NIO has aggressively expanded its footprint outside of China’s robustly competitive EV market. In 2021, the company began selling vehicles in Norway. In February this year, CEO William Li (李斌 Lǐ Bīn) announced that NIO will be providing services in over 25 countries and regions by 2025. The huge screen behind him displayed a world map with several regions highlighted, including North America.

Though it is not yet a household name like Tesla, NIO already has a presence on the West Coast of the United States, with 153 employees working in product and software development, 47 employees working in general administration, and five employees working in manufacturing in North America as of 2021, as per the annual report of the firm. San Jose in Northern California is home to NIO’s global research and development center for autonomous driving.

But can NIO actually make cars?

Despite NIO’s global manufacturing ambitions, it is important to note that NIO does not manufacture vehicles independently. Since 2016, it has been partnering with Jianghuai Automobile Group (JAC), a state-owned automobile manufacturer, to jointly produce vehicles. NIO pays JAC for each vehicle produced on a per-vehicle basis monthly, and all vehicles are produced in the JAC-NIO Advanced Manufacturing Base in Anhui Province.

Manufacturing in collaboration with partners is subject to risks with respect to operations and quality standards. If a plant is eventually established in the U.S., it is unclear if it will be managed independently by NIO or co-managed by NIO and JAC. If JAC is involved, the involvement of a state-owned company in the plant would almost certainly raise the eyebrows of U.S. regulators.

NIO’s global ambitions are without doubt, but time will tell if the company will actually be able to build out a global manufacturing capacity.