Not long ago, electric vehicle startup NIO looked like it was on the verge of establishing itself as a serious player within the EV space and a rival to Tesla. The company has fallen on hard times, however.
Reuters reports that the company has been hurt by slowing demand for its vehicles and reduced government subsidies for electric vehicles in China. NIO’s woes have been exacerbated by the coronavirus that’s disrupted the production and delivery of its cars.
Read More: Nio Introduces EC6 Crossover Coupe With Up To 382 Miles Of Range
In a statement issued by the company, it says that the cash balance of $151.7 million it had as of December 31, 2019 is not adequate to provide the capital and liquidity needed for continuous operation across the next 12 months.
NIO made several private placements of convertible notes in February and March worth $435 million to support its operations and business development.
However, this could be too little too late as vehicle sales in China plummeted by 18 per cent in January while sales of battery electric and ‘new energy vehicles’ are down by 54.4 per cent, according to the China Association of Automobile Manufacturers.
News of NIO’s financial struggles comes just a few months after the car manufacturer unveiled its all-new EC6 crossover coupe in Shenzhen, China. NIO says its latest vehicle features two electric motors to deliver a total of 536 hp, allowing the crossover to hit 62 mph (100 km/h) in just 4.7 seconds. Feeding the electric motors with power is a 100 kWh battery pack that’s reportedly good for 382 miles (615 km) of range.
