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Chinese electric vehicle manufacturer Nio Inc – ADR (NYSE: NIO) is ratcheting up its marketing strategy.
What Happened: Nio has launched a difficult-to-resist offer of zero down payments for prospective customers looking to buy any of its three models, CN EV Post reported.
This offer is applicable to car purchases between Jan. 20 and Feb. 28.
The minimum down payment for car purchases in China is around 15% now, the report said.
Nio presently sells three SUV models in China: the ES6, ES8 and EC6.
A customer purchasing a ES6 EV with a 100 kilowatt-hour battery pack — priced at 416,000 yuan ($64,400) before subsidies — under the battery-as-a-service plan, needs to shell out a monthly installment of 7,567 yuan and battery rental service of 1,480 yuan per month if they opt for a three-year repayment period under the zero-down option.
Why It's Important: The zero down payment option is likely to lead to increased orders for Nio. Lead times for delivery are expected to increase, the report said.
Nio offered a similar deal in September 2019 when it was struggling with stagnant sales and a cash crunch.
The latest trigger could be bigger rival Tesla Inc's (NASDAQ: TSLA) price cuts for both its mass market Model 3 vehicles and the recently launched made-in-China Model Y vehicles.
Nio's reluctance to undercut on price for fear of damaging its premium positioning could be leading the company to float innovative incentive offerings.
NIO Price Action: Nio shares were down 1.52% at $56.84 at last check Thursday.
Photo courtesy of Nio.
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