Co-Founder and former Ford China executive, Jack Cheng, is leaving Nio, an electric car company out of China, according to a recent company announcement. Cheng was with Ford China for nearly thirty years and has chosen to retire “due to his age.”
Cheng’s departure is coming in the middle of a tumultuous year for NIO, one where the startup has struggled to maintain the level of sales it saw in its first few months of deliveries in 2018. The Tencent-backed company’s other two Founders, William Li and Lihong Qin, still serve as NIO’s CEO and President, respectively.
NIO’s first vehicle, the ES8 SUV, started shipping last summer, a few months ahead of the company’s public listing on the New York Stock Exchange. Billed as a competitor to the Model X, NIO touted the SUV as a cheaper option that still offered similar range and high-tech features, including a headline-grabbing robotic smart assistant embedded in the dashboard.
The company raised around $1 billion when it went public, and the startup shipped 10,000 ES8s by the end of 2018. But the expiration of Chinese government subsidies, plus a slowdown in both China’s economy and automotive sector, have reversed a lot of that momentum. ES8 deliveries have declined month over month since March of this year, and NIO delivered just 164 of them in July, the worst full month of sales for the SUV since it started shipping in 2018. The company’s stock price has plummeted by about 75 percent.
As a result, NIO has spent most of 2019 slashing the costs of its business (or as a spokesperson put it to The Verge earlier this year, “optimizing management efficiency”). The five-year-old startup announced in March it was abandoning its plan to build a factory outside of Shanghai in favor of continuing to have its cars made by a state-owned contract manufacturer. In May, NIO laid off 70 employees and closed an office in Silicon Valley, and also began laying off at least 3 percent of its workforce in China. A few weeks later, NIO indefinitely delayed a forthcoming electric sedan. And in June, the company recalled nearly 5,000 of its SUVs because of a fire risk.
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