China Backs Battery Swap in Nio Partnership

It appears Chinese regulators are trying to ensure the survival of battery-swap pioneer automaker Nio after the announcement of its partnership with Changan Automobile.

The loss-making automaker persevering with disruptor battery-electric vehicle technology has won a partnership with the state-owned Changan to help cut costs of the hugely capital-intensive swap-out service to consumers. Only a month ago, Nio announced its 2,000th service station opened in the Baoji West Service Area on the G30 Lianyungang-Khorgos Expressway, known as the extension of the old Silk Road in China. This route supports Nio users traveling from Lianyungang, located on the east coast of China, to Tianshui in the western province Gansu.

Reuters reports that the two companies will collaborate on building and sharing battery-swapping stations and standardizing batteries. The partnership will see employee numbers trimmed back and long-term investment plans paused in a bid to cut costs in a market facing increased competition from both domestic and foreign automakers.

While swapping out battery packs have great speed advantages over using fast chargers on extended journeys for BEVs, it does require massive standardization of batteries as well as adequate stores of fully charged units to replace in vehicles. Most BEV makers believe that fast-charging infrastructure improvements will make advantages of battery swapping irrelevant going forward. However, proponents counter that base vehicles will have a longer lifecycle than other BEVs which have to be scrapped when their battery packs are beyond their service life.

Changan and Nio ranked seventh and eighth in terms of BEV sales in the first nine months in China with 123,322 units and 109,993 units, respectively, according to data from China Passenger Car Association.