Electric vehicle maker Nio reported 25% sequential growth in December deliveries, bringing fourth quarter totals to 8,224 units and in line with the company’s forecast.

Why it matters: Nio has formed a community of devoted users to promote its cars to potential buyers, a marketing approach which has started to pay off.

Details: Nio said on Monday that total deliveries increased 25.4% month over month to 3,170 vehicles in December.

  • Deliveries of its five-seat ES6 SUV resumed growth, rising 22.7% sequentially to 2,537 units after declining 7% in November.
  • Sales of its first mass-production model, the ES8, also recovered with 633 units delivered during the month.
  • The Tencent-backed EV maker attributed support from its buyer community as the driving force behind its growth. More than 45% of new orders in 2019 came from existing owner referrals, according to CEO William Li.
  • The December delivery figure was 4% lower than the same period in 2018, when Nio delivered a record 3,318 ES8s in a month, bucking a broader slowdown in overall car sales.
  • The company has delivered a total of 31,913 vehicles as of December, for 18 total months of deliveries.
  • Nio shares decreased 3.92% to $3.68 by market close on Monday.

“These results are attributable, not only to our products and services that continue to stand out from competition in quality, performance and pricing, but also to our passionate, loyal and supportive user base. Through favorable word of mouth and referrals, our existing users remain a steady and relevant driver of new orders.”

—William Li, Nio founder and chairman

Context: The December delivery figures surpass the company’s outlook for the fourth quarter of 8,000 units.

  • The car company issued a first set of online community rules on its app in September 2018, including a reward of 100 Nio Values for referring a friend.
  • Nio Values are tied to user participation and contributions to the community, and those with a greater contribution have higher voting rights as well as more priority when registering for popular events, according to the rules.
  • Voting rights within the community can be put toward voicing opinions on corporate activity. The company cited the example of a trust fund created by Li using 50 million shares, the proceeds of which were decided by the community.

Nio shares surge despite lingering investment concerns

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

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