Chinese electric carmaker Nio has denied it’s in talks with Mercedes-Benz to exchange technology for financial backing, as it reportedly battles financial struggles.
According to reports from Reuters, Nio founder and chief executive William Li met with Mercedes-Benz CEO Ola Kallenius to discuss a “tie-up” between the companies earlier this year.
The news outlet contacted Nio to confirm the rumours at the time, to which the electric car maker simply replied “untrue” without any further explanation.
The Reuters report followed a statement from Nio clarifying “the Company currently has no reportable capital raising activity, other than the recent convertible notes offering that was completed on September 25, 2023”.
Mercedes-Benz issued a response to Reuters confirming “Ola Kaellenius is in an ongoing regular dialogue with various industry leaders and peers, including William Li”.
Nio reportedly approached Mercedes-Benz with a “tie-up proposal”, but talks never outlined details on the technology to be transferred or the definitive financial investment.
Reuters reports Mercedes-Benz discussed the matter internally but claims it’s “highly likely it would not proceed” with the investment.
Mercedes-Benz research and development and strategy teams were “largely against the proposals” according to the report, based on concerns it “could undermine Mercedes’ brand image”.
Concerns were raised the Nio partnership could ruffle feathers and “upset shareholder harmony” with other Chinese stakeholders in Mercedes-Benz.
This latest round of reports from Reuters follows coverage from Car News China in August claiming Nio and Mercedes reached a cooperation agreement earlier in 2023, where Nio would share its battery swapping tech with Mercedes-Benz to start a new profit model.
Nio reported losses of US$837 million (A$1.302 billion) in the second quarter of 2023, which reportedly left it looking for investors to keep it afloat.
Most western carmakers have partners in the Chinese market, thanks in no small part to recently relaxed rules from the Chinese government surrounding manufacturing.
Mercedes-Benz has a joint venture with Geely for its Smart brand, which has been reborn to sell electric cars only and move manufacturing to China.
In 2010, Mercedes-Benz’s parent group entered into an equal partnership with BYD to co-own Denza but largely walked away from the partnership in late 2021 to focus on Smart.
Yesterday, Nio announced its third quarter delivery results which showed a 43.8 per cent increase for September year-on-year and a promising on-going result for the quarter with Q3 sales increasing by 75.4 per cent YoY.
According to Reuters, Nio is ranked ninth among electric and hybrid manufacturers in China. It has been increasing its investment in self-developed technologies for key electric vehicle components such as chips and battery technology.
Nio has begun expanding into Europe, but it yet to announce anything officially regarding when it will come to Australia. There is speculation it could enter the local market by 2025.
MORE: Brand Overview: Nio