The tale of Nio has not happened in isolation: It is an allegory for China’s electric vehicle market as a whole, in which young EV companies are struggling to survive in an ever-slowing market.

Struggle wasn't always the norm. In 2015, China’s new energy vehicle market became the world's largest with annual sales of 370,000 cars. The State Council, China’s cabinet, had earmarked the sector for development as part of a five-year plan, with an aim to drive growth by a system of government-mandated production quotas, central government incentives, and regional purchase subsidies.

As a result, the sector boomed, with as many as 500 EV startups established with backing from government investments, real-estate barons, and tech giants. Everyone wanted to ride the wave of investment in electric cars.

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Jill Shen

Jill Shen is Shanghai-based technology reporter. She covers Chinese mobility, autonomous vehicles, and electric cars. Connect with her via e-mail: jill.shen@technode.com or Twitter: @yushan_shen

Chris Udemans

Christopher Udemans is a Shanghai-based data and graphics reporter. He covers Chinese artificial intelligence, mobility, and cybersecurity. You can contact him at chrisudemans [at] technode [dot] com.