NIO Automobile sued by Savills, fined more than one million yuan


News reports last March 11 stated that the Shanghai Jiading District Court has ruled that Shanghai NIO Automobile Co., Ltd., should pay an intermediary service fee of RMB 1.1. million to Savills plus interest on overdue payments dating back to May 1, 2017, up to the date of actual payment.  Savills recommended Shanghai HKRI TAIKOO Hui to NIO Automobile.  However, NIO believed that Savills only introduced the project and did not participate in the lease.  The negotiation of conditions did not assist the two parties in signing the lease contract so no commission was paid.  The court subsequently rules to uphold the first instance.

This recent development adds to the woes of the car company.  NIO Automobile has been the frequent center of attraction due to the company’s lack of funds and numerous financing issues.  Li Bin, the company’s chairman, has also been the subject of disgruntled netizens’ brunt, unofficially named “the worst person in 2019.”

Multiple factors hampered the company’s new car delivery last month, causing a decline in sales.  Data released by NIO showed that 707 electric vehicles were delivered in February, a 12.8% decline in year-on-year.

The third quarter 2019 financial report of the company reported a net loss of 2.5217 billion yuan (about US$352.8 million) while its total cash, cash equivalents, restricted cash, and short-term investments amounted to 1.907 billion yuan (around US$274.3 million).

On a positive note, NIO has recently made significant progress in domestic financing efforts, a development that can alleviate its current shortage of operating funds.  The company has announced the signing of a cooperation framework agreement with Hefei City last month with the settlement of the NIO China headquarters project in the city.   Under the agreement, the Hefei municipal government will invest 10 billion yuan in the project.