Pictured here is a Nio battery swapping station in Haikou, Hainan province, China, on May 9, 2023.
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BEIJING — Chinese electric car company Nio has been expanding its battery swap partnerships in a bid to gain an edge on the infrastructure side of the EV ecosystem.
Since November, Nio has partnered with at least four Chinese automakers — Changan, Geely, Chery and JAC — for developing battery swap standards and expanding the network in China.Nio also announced agreements earlier this year to work with two local battery companies on battery swap services.
All these efforts are aimed at alleviating consumers’ anxiety about driving range. While having a large network of battery charging stations helps address those concerns, battery swapping is a faster method as it takes only a few minutes.
“Swapping right now is mainly driven by Nio. Of course, Nio found out this is an ecosystem,” CLSA’s deputy head of research Ding Luo said in an interview. “If only one player is trying to build up the whole ecosystem, it’s impossible for [them]. That’s why they’re thinking whether they can invite some partners.”
Battery swapping still isn’t mainstream because the car batteries need to be standardized, he added.
While a charging station resembles a typical gas station, battery-swap technology is housed in a shed-like structure. It uses machines to automatically exchange depleted batteries for pre-charged ones in compatible cars.
Nio said in mid-March that it completed 40 million battery swaps compared with nearly 37 million charges at its public stations — Nio consumers can also access third-party charging stations, or install one at home.
“I think our outlook is very simple,” Shen Fei, senior vice president of Nio’s power division, said in Chinese translated by CNBC. “The first thing is to serve Nio’s users, and then provide a good battery charging and swapping experience, make charging more convenient than refueling, and at the same time help the company sell more cars.”
The company claims that with battery swap, drivers can get a fresh charge in three minutes, if they opt in for a paid battery service plan.
Shen said more car models will be added to Nio’s battery swap network, while adding that swapping can allow drivers to keep abreast with improvements in battery technology.He did not specify which automakers will likely be added to its network.
Power services and other products account for just about 10% of Nio’s total revenue. The company said that category of “other sales” for 2023 grew by 69% to 6.36 billion yuan ($895.9 million). Nio does not break out swap station revenue.
Battery swap’s checkered past
Battery swapping has been tried by the industry with mixed success, especially in the U.S.
Tesla and a startup called Better Space tried out swapping more than 10 years ago, but the venture soon closed.
While it’s not clear how much headway Ample has made in the U.S., the company has since expanded its partnerships overseas. Last month the company announced it would serve corporate car fleets in Kyoto, Japan, while it teamed up with Stellantis to roll out battery swaps this year in Madrid, Spain.
“For swapping to work it can’t be niche,” Tu Le, head of consultancy Sino Auto Insights, said. “Battery inventory investment is massive, so it needs to be amortized over lots of swapping.”
But he was cautious on whether Nio could sell enough of its own premium-priced cars to make the economics work. “For now I still think the combination of swapping and charging makes for a pretty attractive feature set, but swapping alone likely doesn’t help them sell that many more cars.”
“I think the nudge the Chinese government gave to encourage others to join forces with Nio on swapping could create the necessary pool of vehicles to make swapping viable,” he added.
The business of charging
Nio is the first major electric car company to roll out battery swap stations in addition to charging stations, alongside its own vehicles in mainland China and Europe.
The company has installed more than 2,300 battery swap stations, and plans to install 1,000 more this year.
Nio’s investment in battery swap stations is about two years ahead of market demand, CEO William Li said last month, adding that less than a fifth of battery swap stations that Nio operates are processing 60 orders a day, likely the minimum orders needed for a station to break even.
Nio’s battery charging stations, on the other hand, reached profitability last year, according to the company. It plans to build 20,000 more this year.
Passenger car battery swap stations can cost around $500,000 to build, while a relatively basic charging station with two ports costs around $200,000 to $300,000, according to Shay Natarajan, a North America-based partner at Mobility Impact Partners, a private equity fund that invests in transportation.
CLSA’s Luo said businesses also prefer to invest in normal charging stations than swap stations because they make a higher return. But if businesses want to install faster-charging stations, he said they might face power grid challenges.
CLSA’s analysis found that the power required for five superchargers in one location would be more than what 300 families would normally consume.
Tesla is also collaborating with automakers in battery charging, with its over 50,000 superchargers worldwide that claim to restore about two-thirds of a battery’s charge in 15 minutes.
The rapid development of electric cars, ostensibly aimed at reducing carbon emissions, also raises questions about battery waste.
Nio pointed out that recent growth of new energy vehicles, which include hybrids, means nearly 20 million batteries will be reaching the end of their eight-year warranty period between 2025 and 2032.
Last month, the company announced a partnership with battery giant Contemporary Amperex Technology to develop batteries with a longer lifespan, particularly for those used in swap stations.
Nio claimed that by using battery swap and big data, it can retain 80% of a battery’s capacity after 12 years of use. Nio also said last month that CATL will develop batteries with longer lives for the company.
— CNBC’s Lora Kolodny and Michael Wayland contributed to this report.
Check out the companies making headlines in midday trading. Lululemon – The athleisure company saw shares plunging more than 11% after President Donald Trump’s imposition of tariffs on countries where the firm imports a big portion of its products. In 2024, Lululemon sourced 40% of its products from Vietnam, which was hit by a 46% tariff by the administration. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Deckers Outdoor – Shares of the footwear company plunged more than 14% following Trump’s reciprocal tariffs rollout. The Ugg maker has 68 supply chain partners in Vietnam and 125 suppliers in China. Nike – The athletic apparel stock declined 12.1% following the Trump administration’s wide-ranging tariffs upon major trading partners. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retail stocks – Shares of Five Below and Dollar Tree shed more than 27% and 9%, respectively, on the heels of the new reciprocal tariff announcement. Both companies are big sellers of imported goods, and Dollar Tree CEO Michael Creedon has said that the company might increase prices to offset the tariff impact. Bank stocks – Shares of several banks Bank stocks pulled back as traders reckoned with the potential economic fallout of Trump’s tariff policy. Shares of Goldman Sachs and Morgan Stanley each slid nearly 8%, while JPMorgan Chase , Bank of America and Citi fell more than 5%, 9% and 10%, respectively. Ford – The automaker’s stock declined nearly 4%. On Thursday, Ford announced that it’s offering employee pricing to all customers on multiple models in a program called “From America for America.” Trump’s 25% tariffs on imported vehicles went into effect Thursday. Big Tech stocks — Shares of mega-cap technology names plummeted amid investor concerns that the businesses will face pressures from Trump’s tariffs. Tesla declined nearly 5%, while shares of Amazon and Apple fell more than 7% and 8%, respectively. Alphabet shares also moved more than 3% lower. Semiconductor stocks – Shares of chipmakers also took a hit after the tariff announcement, even after the White House said that semiconductors wouldn’t be subject to the new levies. Shares of Nvidia and Advanced Micro Devices both fell more than 6%, while Broadcom declined more than 8% and Qualcomm slumped more than 9%. Microsoft – Shares shed about 3% after Bloomberg, citing people familiar with the matter, reported that the company is scaling back its data center projects around the world. RH – The luxury home furnisher nosedived 43.5%, on track for its worst day on record after fourth-quarter earnings and forward guidance came in weaker than expected. RH earned $1.58 per share, excluding items, on $812 million in revenue, while analysts polled by LSEG penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman told analysts that the company was operating within the ” worst housing market in almost 50 years .” Wayfair – Shares tumbled 25% on the back of Trump’s newly announced tariffs, with countries such as Vietnam, Thailand, Cambodia and the Philippines all receiving higher tariffs than the baseline 10%. During a February earnings call, Wayfair CEO Niraj Shah said that these aforementioned nations “have grown as places where folks have factories and where our goods are coming from.” Lyft – The ride-sharing stock dropped more than 9% after receiving a double downgrade to underperform from buy at Bank of America, citing increasing headwinds from autonomous vehicles. Lamb Weston – Shares gained more than 9% after the food processing company posted better-than-expected third-quarter results. Lamb Weston reported adjusted earnings of $1.10 per share on $1.52 billion in revenue, while analysts polled by FactSet were expecting 86 cents per share on $1.49 billion in revenue. — CNBC’s Alex Harring, Hakyung Kim, Yun Li and Lisa Kailai Han contributed reporting.
Check out the companies making headlines before the bell. Lululemon – Shares tumbled more than 12% on the heels of President Donald Trump’s new wide-ranging tariffs . According to an SEC filing , the company sourced 40% of its products from Vietnam in 2024 – a country that was slammed with a 46% tariff. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Nike — Shares slumped about 9% after the United States lifted tariffs Wednesday. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retailers — Dollar Tree and Five Below tumbled more than 10% and 15%, respectively. Dollar Tree CEO Michael Creedon previously said the company may raise prices on items to offset the impact of new U.S. tariffs. The two companies are big sellers of imported goods. Ford — The automaker slipped 2.3%. Reuters reported that Ford will offer employee pricing to all customers on multiple models to absorb tariff costs, in a program called “From America for America.” Big Tech — Shares of mega-cap technology companies such as Nvidia fell as investors worried that the businesses will come under pressure from President Donald Trump’s new tariff regime. Nvidia dropped more than 5%, as did Tesla . Shares of Amazon.com slid more than 6%. Apple declined by more than 7%. Microsoft — The tech stock declined 2.3%. Bloomberg released another report stating that the XBox and Windows company is scaling back data center projects in the U.S. and overseas. JPMorgan , Citi , Goldman Sachs , Morgan Stanley — Bank stocks retreated sharply early Thursday as investors weighed the economic fallout of Trump’s tariff policy. Shares of JPMorgan Chase were down 3.8%, while Citi, Goldman Sachs and Morgan Stanley all slid more than 4%. RH — The luxury home furnisher plunged 28% after posting weaker fiscal fourth-quarter earnings and first-quarter guidance than Wall Street had estimated. RH earned $1.58 per share, excluding one-time items, on $812 million in revenue in the fourth quarter, while analysts polled by LSEG had penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman acknowledged to analysts that the company was operating in the “worst housing market in almost 50 years.” Deckers Outdoor — The footwear company that makes Ugg boots sold off more than 12% after the Trump administration’s reciprocal tariffs rollout. Deckers has 68 supply chain partners in Vietnam and 125 suppliers in China. Wayfair — The furniture retailer weakened about 12% on the back of higher U.S. tariffs on goods from Cambodia, Vietnam, Thailand and the Philippines. CEO Niraj Shah said during an earnings call in February that the countries “have grown as places where folks have factories and where our goods are coming from.” — CNBC’s Alex Harring, Jesse Pound, Sarah Min and Sean Conlon contributed reporting
‘The Big Money Show’ co-hosts discuss buy now, pay later spending options and the impact it will now have on your credit score.
Small, everyday purchases like a meal from DoorDash are now able to be financed through eat now, pay later options — a practice that some experts deem “predatory.”
“You’ve got to have enough sense to not follow the urge to finance a taco, okay? You have got to be an adult,” career coach Ken Coleman told “The Big Money Show,” Wednesday.
“This is predatory, and it’s going to get a lot of people in deep trouble.”
DoorDash and Klarna are now partnering up to extend buy now, pay later options to consumers. (Reuters, Getty / Getty Images)
Financial wellness experts are continuously sounding the alarm to cash-strapped consumers, warning them of the devastating impact this financial strategy could have on their credit score as some lenders will begin reporting those loans to credit agencies.
Consumers may risk getting hit with late fees and interest rates, similar to credit cards.
“So your sandwich might show up on your FICO score, especially if you pay for it late,” FOX Business’ Jackie DeAngelis explained.
Major players like Affirm, Afterpay, and Klarna have risen to prominence at a time when Americans continue to grapple with persisting inflation, high interest rates and student loan payments, which resumed in October 2023 after a pause due to the COVID-19 pandemic.
Ramsey Solutions personal finance expert and ‘The Ramsey Show’ co-host George Kamel discusses the ‘buy now, pay later’ craze and the trend that celebrates the financial benefits of being childless.
“The Big Money Show” co-host Taylor Riggs offered a different perspective, suggesting that company CEOs have a “duty” to attract as many customers as they want.
“Unfortunately for me, this always comes down to financial literacy — which I know is so much in your heart about training people to save now by later,” she told Coleman, who regularly offers financial advice to callers on “The Ramsey Show.”
Coleman continued to come to the defense of financially “desperate” consumers, arguing that companies are targeting “immature” customers.
“I’m for American businesses being able to do whatever they want to do under the law. That’s fine. But let’s still call it what it is: it’s predatory, and they know who their customers are,” Coleman concluded, “And I’m telling you, they’re talking about weak-minded, immature, desperate people.”
FOX Business’ Daniella Genovese contributed to this report.