Nio is set to lay off 10% of its staff this month, TechCrunch reported.
Reorganization at Nio comes as the company eyes the US market.
There's an opening for cheap EVs in the US.
Big changes are in store for Chinese electric car company Nio, one of Tesla's biggest rivals in the world's largest vehicle market.
TechCrunch reported Friday that Nio is set to lay off 10% of its workforce as it rushes to cut costs and reorganize its business as competition in the electric market intensifies. The cuts are part of a larger reorganization at the company, TechCrunch reported, which is supposed to be completed in November.
News of layoffs and reorganization at Nio come as the Shanghai-based company eyes US EV sales by 2025. Chinese car companies have often eyed the US market, but none have yet made a big splash in the highly competitive market.
But there may be a new opening for companies like Nio.
The electric vehicle transition in the US is undergoing some turbulence at the moment as the average price for EVs isn't matching up with the buying power of the current EV shopper. Years of growth in the US EV market is showing signs of slowing, and US manufacturers are pulling back on big electric vehicle production promises.
Nio can bring cheap EVs to the US
Electric vehicle prices in the US have taken a nosedive this year, driven largely by Elon Musk's aggressive price cuts at Tesla. But the average price paid for an EV in September, $50,680, is still well out of reach for many would-be EV owners.
That's where Nio comes in.
The company plans to enter the US market with an affordable model, priced around $27,844. This is a price point that Tesla and others in the US EV market have been trying to break into for years, but haven't reached due to high manufacturing and materials costs.
Earlier this year, industry experts came away from the Shanghai Auto Show with the impression that companies like Nio are well-positioned to make a splash in the US with its more inexpensive EVs. Nio in particular has made improvements in style and quality necessary for beating back competition from American car companies.
"It's going to be an interesting couple of years ahead to see whether Ford and GM and the like can stave off that Chinese competition coming in," Martin French, a managing director at the consultancy Berylls, told Insider earlier this year. "From what we saw at the Shanghai auto show this year, that competition is very, very real."
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