Recently, Li Bin of NIO stated at an internal meeting for middle and senior management that achieving profitability in the fourth quarter this year is a must. “Achieving quarterly profitability is the report card that our entire team must deliver to prove our operational efficiency and management capabilities. It is also something we must achieve. This is not for show, but rather the cornerstone for our company’s long-term sustainable development.”
Li Bin believes, “Profitability should come from selling more cars, not just by cutting costs. We cannot fish the pond dry.” The prerequisites for profitability in the fourth quarter are: first, effective marketing of key models; second, ensuring the supply chain and reducing costs; third, delivering high-quality software versions on time. Additionally, Li Bin stated, “Focusing only on the long term without considering the short term will lead to the company’s demise; focusing only on the short term without considering the long term will prevent development prospects.”
This year, the company is set to start formulating a three-year business plan. In the fourth quarter, while deepening the full-staff operation mechanism (CBU), each business line must establish its own three-year operational plan, including further deepening the CBU assessment and incentive mechanisms. At the same time, the company will continue to enhance its system capabilities and train teams to combine long-term goals with short-term execution. Li Bin also mentioned that the company has made some progress in system capability improvement this year, but further enhancement is still needed. “Last year, our system capabilities were clearly defined, but in reality, many actions this year were not decisive enough.”
In March this year, Li Bin made a “military order” and stated that the company would strive to achieve quarterly profitability in the fourth quarter of 2025. If this goal is not achieved on time, the company’s long-term development and business model will face a severe test. In April, during the “10,000th NIO user” delivery event in Shanghai, Li Bin pointed out that if NIO does not become profitable or cannot operate sustainably, he as CEO would be unqualified. Regarding the realization of profitability, the company had previously stated that the first few quarters of this year would still be in the investment phase. In terms of funding, through the “Add Power Partners” plan and cooperation with CATL, the company aims to reduce financial pressure; meanwhile, it plans to use capital market financing channels and strengthen cash reserves to achieve this goal.
Currently, NIO Group has launched three major brands: NIO, Li Auto, and Firefly. In the past third quarter, NIO delivered 87,071 new vehicles, a 40.8% year-on-year increase. In September, 34,749 vehicles were delivered, setting a new historical high. Since its establishment, NIO has been operating at a loss, with a loss of 11.745 billion RMB in the first half of the year. The third-quarter financial report has not yet been disclosed, but it is expected that the company is still in a loss state. Whether the company can achieve profitability in the fourth quarter remains to be seen.
