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Chinese electric vehicles (EVs) maker Nio (NYSE:NIO) introduced a high-end smartphone designed to be used with its EVs, Reuters reported.
The Nio phone will sync with Nio cars to act as a key fob, view information such as battery charge, and control functions such as self-parking and the in-cabin infotainment system.
A Nio driver can also use the phone to notify their car to drive itself to their location (permitted in China in certain areas) and to unlock the car even when the phone is switched off, the report added.
Three models of the phone are priced between 6,499 yuan and 7,499 yuan ($890-$1,030). The phone will only be sold in China for now and deliveries will start from Sept. 28.
For comparison, Huawei Technologies latest flagship, Mate 60 Pro is almost similarly priced.
Founder and CEO William Li has gone ahead with the smartphone project despite concern among some investors that the company, which has seen its losses widen amid an intense price war in China, is taking on too much, the report noted.
The company’s main interest in making the phone is probably in collecting user data rather than aiming to make the phone a key contributor to revenue, the report added citing IDC analyst Will Wong. “Smartphones will be a good platform to collect more data which is crucial in the current tech world and could potentially lead to better user experience,” said Wong.
“We want our phone to connect seamlessly with the car, and bring a better user experience to our car owners,” said Li at the company’s ‘Innovation Tech Day’ in Shanghai, as per a Bloomberg News report.
Founded in 2014, Nio has yet to turn a profit from its main auto business. In August, the company reported that Loss from operations in Q2 was RMB6,074.1M ($837.7M), an increase of 113.5% from the Q2 2022.
In June, Nio raised about $738M from a share sale to Abu Dhabi’s CYVN Holdings, the Bloomberg report added, and earlier this week announced a $1B of convertible senior notes NIO slides after convertible note offering rattles investors — sending the stock down ~17% on Tuesday.
Despite a recent rebound in sales, Nio shipped 94,352 vehicles in the first eight months of the year, less than half its annual target of 250,000, the report added.
To strengthen sales, Nio has cut prices, wound back customer benefits, and brought revamped models and delayed some investments, the Bloomberg report added.
At a separate briefing on Thursday evening, Li noted that Nio’s gross margin should return to double digits in Q3 and then improve more after dropping as low as 1% in the previous three-month period. Longer term, the company intends to achieve 20%, Li said, noting that declining lithium prices are helping, according to the Bloomberg report.