Raising funds through private placement avoids the typical public filings and is a simpler way to get money. The bonds are provided at a fixed rate and those who buy them can remain private.
This is the third time Nio raised funds via private placement in the last month. The company sold convertible notes and raised $70 million at the beginning of February and another $100 million in the middle of the same month.
Nio also revealed it has sold convertible notes through private placement in January to investment funds for similar terms. So far this year the company has raised $435 million through convertible note sales.
Nio has been struggling due to a slowing auto sales market and the Chinese government lowering the number of subsidies offering for electric cars.
Previously the Chinese government offered incentives to develop electric cars to push overall market adoption to help reduce pollution. Now that electric car sales are slowing and subsidies are lowered, companies like Nio must find additional cash.
Nio also recently announced a new partnership with the municipal government of Hefei, Anhui province in China. This partnership will have the local government provide funding for Nio to grow within the region where Nio already has its main manufacturing located. The investment is estimated to be around $1.4 billion.
"Under the framework agreement, Hefei government expects to provide resources and funding support for the long-term growth of NIO in Hefei, and NIO plans to establish NIO China headquarters, further expand its operations and deepen its relationship with local ecosystem partners in Hefei," NIO wrote in its press release.
Nio will place its headquarters in Hefei and grow its current operations and expand partnerships with companies in the region.
Tesla, the major electric car manufacturer based in the US, is also giving Nio plenty of competition. Tesla started making its Model 3 within China recently and after completing its factory in Shanghai became the first foreign company to entirely own its own factory in the country. Even as deliveries of these Chinese-made Tesla cars started in January, the coronavirus has slowed Tesla sales just as it has Nio's.
While Tesla continues to see demand for its vehicles, Nio has a deeper gap to cross. Nio ended 2019 with strong consecutive financial quarters, but the beginning of 2020 has seen an 11.5% drop in vehicle deliveries.