Chinese electric vehicle manufacturer Nio Inc. NIO is set to lay off 10% of its workforce in response to “fierce competition.”
What Happened: The layoffs are expected to be completed by November, CNBC reported on Thursday. CEO William Li communicated the decision in a letter to the employees, stating the next two years would see intense competition amid the ongoing transformation of the automotive industry.
“This is a tough but necessary decision against the fierce competition,” Li wrote, adding that the company has spent the last two months analyzing its two-year operating plan.
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Nio is concentrating on tech investments, ceasing projects that fail to contribute to financial performance within three years, and ensuring timely release of its core products, as per Li.
Like many Chinese electric vehicle startups, Nio has been impacted by weak consumer sentiment, stiff competition, and a price war initiated by Elon Musk’s Tesla Inc. TSLA.
While still not profitable, Nio has successfully escalated its vehicle deliveries, reporting 16,074 cars delivered in October, a slight increase from the previous month and 60% higher than the same period last year.
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