Nio co-founder Jack Cheng has left his position as executive vice president and will transition to the role of adviser after four years of helping build the company. The development is the latest in a series of blows for the Chinese electric vehicle maker after rapid downsizing, massive recalls, and huge losses.
Why it matters: The management shake-up casts fresh doubts on the EV maker’s future with investors concerned about sustainability amid a 13-month drop in sales in the Chinese auto market.
- Nio suffered a 40% decline in sales in July with only 837 vehicles delivered. Sales of its first commercial model ES8 fell from a December record of 3,318 units to only 164 last month.
- Its stock price has lost more than 70% of its value since March, when the company reported a 50% sequential fall in revenue for the first quarter of this year.
Details: Cheng left the company on Wednesday, but will hold onto his title of chairman at XPT, a tier-one supplier of electric power solutions and auto parts affiliated to Nio, according to an internal memo obtained by Chinese media.
- The former Fiat and Ford executive will also advise founder and CEO William Li on supply chain and industrial partnerships.
- He will remain a part of the company’s music group and continue to bring “great shows to employees,” the memo stated.
- Zhong Wanli, vice president of Nio supply chain unit will now report to Li, while Zeng Shuxiang, former head of supply chain for the US market, will take over as CEO of XPT.
- The company has gone through several rounds of large-scale layoffs since the turn of the year, reportedly reducing the workforce by 14% to 8,400 as of July.
- Nio also lost two senior executives in June, including the software unit head Zhuang Li, who took over the development of the company’s digital cockpit from former Nio US CEO Padmasree Warrior in December.
This article has been corrected to reflect that Zhaung Li took over part of Padmasree Warrior’s responsibilities, and did not take on her role of CEO as previously stated.