Nio has implemented layoffs across multiple departments, with the majority of reductions affecting sales and service teams, according to a report by Chinese tech media outlet Leiphone. The company is offering compensation and reassignment options to affected employees.
The sales team has been a primary focus of the restructuring, along with the UR Fellow department, which handles after-sales services, Nio House locations, and related customer service operations. The layoffs are estimated to be around 10%, though the impact varies by region, Leiphone reported, citing employees familiar with the matter.
See also: Nio Restructures to Enhance Cost Control, CEO William Li Increases Supply Chain Oversight
In Shanghai, the UR Fellow team saw a reduction of about 10%, while in Shenzhen, approximately half of the team was let go. Some of the departing employees have reportedly joined Xiaomi’s electric vehicle unit, which is building its own customer service network.
The restructuring follows a broader shift within Nio aimed at cost control. A separate report from 36kr on March 11 indicated that the company’s founder and CEO, William Li, has become more involved in supply chain management. Nio has also introduced a Cell Business Unit (CBU) management system to improve cost efficiency, with multiple departments expected to be streamlined in line with full-year goals.
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Nio’s sales team had expanded significantly in early 2024 to support the launch of Onvo’s first model, the L60. The Shenzhen sales team, for instance, doubled in size from 200 to 400 employees. However, the model has underperformed in the market, prompting adjustments. Onvo had set an ambitious sales target of 15,000 units in January and February, increasing to 30,000 units per month by the fourth quarter. However, sales have fallen short, and internal discussions regarding leadership changes within the Onvo division have emerged, according to Leiphone.
Changes are also being made to Nio’s flagship showroom, Nio House. The store manager position is being eliminated, with responsibilities merging into sales roles. Some full-time staff have been replaced with part-time employees, reducing the number of employees per store from eight or nine to three or four. In Shenzhen, Nio Houses have been opened to the public, whereas they were previously exclusive to Nio vehicle owners.
See also: Nio’s Onvo Confirms Second Model as L90, Set for Q3 Launch
Despite these adjustments, Leiphone reported that some of Nio’s business segments are showing positive trends. The company’s battery swap stations are approaching profitability, aided by a reduction in construction costs from RMB 5-6 million ($690,000-$830,000) to RMB 1-2 million ($140,000-$280,000). Additionally, Nio’s charging infrastructure now services multiple vehicle brands, broadening its revenue potential.