Unprofitable Chinese electric vehicle maker Nio launches smartphone for vehicle owners

Nio (NIO) has launched a smartphone companion device that can be used with its cars as the Chinese electric vehicle (EV) maker struggles to increase revenue.

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Loss-making electric vehicle maker Nio has launched a smartphone with more than 30 car-specific features.
Priced at $900 to $1,000, the mobile is available to all consumers in China only.
In the long term, with lithium prices falling, Nio expects its gross margin to jump to 20%, although it was only 1% last quarter.

The device offers more than 30 features specific to Nio Cars, such as acting as a key fob, initiating automatic parking mode, and facilitating the transition of calls from the mobile device to Nio Cars. Available only in China from September 28, it is priced between $900 and $1,000. The company would expect half of its electric vehicle users to buy it.

This release comes just days after Nio announced the sale of $1 billion in convertible bonds to strengthen its balance sheet. Nio reported a net loss of 6.06 billion Chinese yuan ($835 million) in the second quarter, more than double its loss a year earlier. This was the third consecutive quarter where Nio reported double losses.

Nio also reduced its prices , launched revamped models, delayed investments and cut customer benefits in its efforts to increase revenue and strengthen its balance sheet.

Nio is not the only EV Swedish electric vehicle maker Polestar also plans to launch a smartphone, while mobile phone companies Apple and Xioami are working on their own automobile models. Huawei also sells a number of key technologies to Chinese electric vehicle brand Aito and other companies.

Nio shares were down about 3% in early trading around 10:50 a.m. PT #39;East, Thursday after the news.