NIOtime #8: Is NIO waiting for another breakout soon?

Technical Chart. Media News Recap. NIO App Stories. All from a group of NIO global fans exclusively for the NIO community.

We are thankful to witness another 43 new members joining us on board this week and grow together with NIO! If you’re reading this but haven’t subscribed, we cordially invite you to join us, the 588 NIOtime fans by subscribing here, be the early believer in NIO! We believe one day NIO will surpass where it is today and keep growing to be one of the tech disruptors within the next decade.

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Dear friends,

It’s NIO time, Blue Sky is Here!

Happy Friday! We hope you are doing well this week. The good thing is that we are entering the last week of the month soon, which means we will check how well NIO performs in this high demand October for its monthly vehicle delivery unit. We will share our thoughts for some media news and give our October initial estimate with a public estimate survey link opening to all to participate. Let’s see how NIO has performed this week from the technical chart first.

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Technical Chart

Last week we commented that, “Let’s see if the stock can break through this whole number magic and thus look for another high. Otherwise, the stock is looking its EMA8 for support.”

Instead of pushing up to $30.00, NIO took a break from its 52W high level due to general market weakness and pulling back to its EMA8 ($26.74) for the support. Today NIO touched this level this morning, bounced back quickly and ended the week at $27.16.

If you noted on BB band range, NIO was outside of upper band last week and this week it came back within the BB range. To us, this is normal reaction for a stock rallying 30% in a week and entering price correction due to short term buyers taking profit. As a group of long term investors, we are fine with short term price fluctuation.

Now, we believe that the stock is in consolidation mode awaiting further news around October vehicle delivery number as well as next quarter earning call likely falls on early November. Next week we may expect stock hitting its previous high. If we see NIO pulls back to EMA21 or middle level of BB range, we would take small position on that zone. Anyway, this is just our observation, not finanical advice as always. DYODD and invest safe!

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This Week’s Top 7 Highlights

1. NIO AI Chip Self-Development News Follow Up

2. NIO EC6 Mystery Box Campaign

3. NIO ES6 vs. Ferrari 458 100-Meters Race

4. NIO User Community Launch

5. NIO Power Update

6. NIO House & Space Update

7. NIOtime October Initial Estimate and Public Survey

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News

1. NIO AI Chip Self-Development News Follow Up

A local media reported earlier this week that NIO was planning to develop its own self-driving computing chip and the program, mainly driven by NIO chairman and CEO William Li Bin despite this plan was still in the early stage.

Sources close to William Li Bin said that although the board of directors has not yet discussed the chip project, William Li Bin's intentions have been clear. He is thinking about the final structure and has been making some advance communication with its executives and shareholders.

This news was circulating earlier on the media streams and got a response back from NIO PR stating that

"NIO has been continuing to invest in autonomous driving technology. We will communicate details about ADAS’s specific technology timeline as well as R&D of hardware and software when the timing is right, and now we can't further comment on the market rumors from the time being”. (News Source: cnTech post and iautodaily)

If the news of the self-developed autonomous driving chip is true, it reflects NIO's long term vision for tapping huge opportunities associated with this technology. However, this could mean a huge expense for NIO in near term pouring cash onto its R&D expenditure. NIO will likely to deploy partial proceeds raising last month to fund this ambitious project. The outcome from this R&D project is indeed a high risk with high return invesment for NIO.

From past interviews and public appearances of Li Bin, he acknowledged the future of technology is associated with AI based innovation as well as autonomous driving. This is not suprised for us if Li Bin is bold to launch this with their in-house R&D team and take full control advantage of AI chips like Tesla. We believe their R&D team can take the challenge seriously and execute the task efficiently as they proved to develop NOP, the second driving assistance technology within a short time frame.

In fact, if this is true, we shall see huge money spent on recruiting talents and assembling a top-notch smart hardware team in near future. Once this project is successful launched, the in-house AI chips could put NIO as a strong EV contender in long run.

2. NIO EC6 Mystery Box Campaign

Throughout last week in the NIO app, the news feed is occupied by this NIO EC6 Mystery Box Campaign. It’s a user-oriented event launched by NIO to welcome new EC6 owners with their executive team, including CEO Li Bin, Executive Vice President/Global Quality Executive Chair Dr. Shen Feng, Chief User Officer Wang Wenxuan, Executive Vice President (Product & Project Mgt.) Mark Zhou, and many more.

Can you imagine Elon Musk and his executive team delivering Tesla to you and interacting with you personally? This is happening with NIO CEO Li Bin and his executive team spending their time in delivery center this week for EC6 owners.

This is a delivered promise from Li Bin to build NIO as an user enterprise with unique user experience and lifestyle. It’s like buying a NIO car opening a new door of connected world with a group of dedicated NIO team and passionate NIO users. This is unprecedented for any car brand.

Do you still remember your last purchase experience? The relationship with dealer is done once the car is delivered. To NIO users, the joyful journey is the beginning.

3. NIO ES6 vs. Ferrari 458 100-Meters Race

This past weekend, GeekPark hosted a Fall "Total Motorsports Event" to bring together cars to showcase different eras' styles and allow users and industry professionals to discuss different definitions of a "good car".

GeekPark has shaped a car's all-around challenge by finding the most valuable perspective offered to users in the car's everyday functions, setting up 10+1 sessions in a range of areas including performance comparisons, obstacle reactions, daily travel, and technology features, and transportation accessibility. From traditional manufacturing techniques to today's technological features to its tool attributes, these 10+1 tests bring out a car's original strengths.

• 100-meters sprint race competition

• Ranking of braking distances after reaching 100km/h

• Blindfold touch material to compare interior workmanship and materials

• Smart piloting to test smart driving features

• Testing the car's full range

• "Anti-Ghost" Avoidance to examine how quickly assisted drivers’ react to "ghost sensors."

• Testing for challenging complex road conditions

• “Deer rounding” to test Agile reaction to avoid obstacles in the road.

• “Hold back the decibels” to test the silence of performance.

• “Beach loading” to compare the loading capacity.

• Extra Credit: Parking Space Race for Self-Parking Speed Battle

In the end, the NIO ES6 emerged as the winner after a fierce battle. Meanwhile, the Ford Raptor was surprisingly the runner-up, with the Audi e-Tron coming in third.

The winner, the NIO ES6, excels in new skills that test its intelligence, such as intelligent piloting and "anti-ghost" dodging, and performs well in tests that demonstrate the car's basic performance, such as the 100-meters acceleration and the "deer rounding” reaction.

Worth mentioning, NIO ES6 beat Ferrari 458 in the 100-meters sprint race competition and got the first prize. (News and Photos Source: GeekPark on NIO App)

It’s for fun and but still feel goosebumps to witness NIO ES6 surpassed Ferrari 458 in 100 meter sprint race. Please let us know how you feel in the comment below.

4. NIO User Community Launch

As NIO’s user base grows, so does the number of user groups in the community. The number of interest groups is currently not enough to meet the community's needs for more professional communication. The NIO User Trust Board decided to promote and support a user community certified by the Trust Board to provide industry related services. NIO looks forward to facilitating the sharing of value among users and helping users and communities grow together with the power of professionalism. (Photo and News Source: NIO App)

Among the NIO user communities:

• NIO users can build a common ground of exchange and learning, quickly find partners with a common language, and grow together.

• Those who have the resources don't have to search around but can efficiently match needs and build collaborations within the community.

• Some of those who want to contribute to the NIO user community are no longer alone and can gather more professional strength to provide professional services and support to other community users.

In summary, this NIO user community launch is envisioned by Li Bin and executed by NIO User Trust Board. As mentioned last week, the ultimate level of NIO is becoming a user oriented community surrounding NIO. In first comment picture, Li Bin stated that “Growing together is the main driver behind an united NIO user community. He hopes that NIO users can get connected with each other to create a powerful community.

To NIOtime, this is one of unique moats that NIO recognizes the power of social community and leverage this to unite all NIO users to create additional value added services for current and potential NIO users. In our humble opinions, this move is brilliant as you would think about connecting to a group of elite NIO users when buying NIO cars. This is a NIO exclusive connection. Would you more willing to buy NIO cars for this additional benefit?

5. NIO Power Update: 157th Power Swap & 66th Power Charger

NIO Power Swap #157 | NIO Chendu Laifushi

NIO Power Charger #66 | NIO Nanjing North City Heban

We notice a slowdown on the development of Power Swap and Charger in general. This week at least 1 Power Swap and Charger are in placed for operation. We hope to see more NIO Power development to catch up the demand.

6. NIO House & Space Update: 3 NIO Spaces Added

NIO Space #175 | Xi’an Golden Place Plaza

NIO Space #176 | Yinchuang Jianfa Dayue City

NIO Space #177 | Tai’an Aiqin Sea

Another three new NIO spaces are established this week. For more gallery photos, please view it on the NIOtime’s facebook photo album!

7. NIOtime October Initial Estimate & Public Survey

We are nearing the end of October, and you might know what that means for NIO and NIO investors. In last month’s delivery, NIO beat the September delivery record with a ~130 % YOY. Do you still remember we are closed by 20 units on our previous estimate? Will we see a similar trend on the October delivery number?

Our guess for this month is 5,250 with a range of 5,000 - 5,500. We will release NIOtime Estimate #2 on 1st November, 2020 to discuss our logic behind this estimate number.

If you want to participate in Let’s Guess NIO, we created a public survey recording your estimate in this google form link and you will be able to see others’ guess after responding to the survey.

Summary

Is NIO waiting for another breakout? From all the news we gather this week, none of them are negative to hurt the fundamentals, and there is an upcoming October delivery announcement soon as well as anticipating Q3 Earning Call. Neither way, we are long NIO in the long term and believe in NIO’s strong position in sharing China’s EV market share in the coming years.

We will periodically post quick updates on our NIOtime Instagram, NIOtime Twitter, and NIOtime Facebook. Please do follow us on social media too. Thank you, and have a very nice weekend!

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