“In short, it’s a hit.”
Nio’s CEO, William Li (also known as Li Bin), wasn’t at the launch of Onvo’s first vehicle, but during a media briefing the next day, he summed up the order status of the Onvo L60 in just a few words.
On September 19, Onvo introduced its debut model, the Onvo L60—a midsize SUV tailored for families, poised to compete directly with Tesla’s Model Y. The standard-range version, featuring a 60-kilowatt-hour battery, is priced at RMB 206,900 (USD 28,966), while the long-range variant with an 85 kWh battery is listed at RMB 235,900 (USD 33,026). The lineup is straightforward, avoiding unnecessary complexity.
But Nio isn’t solely banking on bigger batteries. Instead, it’s betting on its battery-as-a-service (BaaS) model, where customers lease the battery, slicing thousands off the vehicle’s sticker price. With the battery rented monthly, the L60’s price drops to RMB 149,900 (USD 20,986), alongside a monthly fee of RMB 599 (USD 83.9) for the 60 kWh battery pack.
Buyers opting for the “founder’s edition” enjoy additional perks. The monthly rental fee for the standard model falls to RMB 479.2 (USD 67.1), and for the long-range version, it’s reduced to RMB 582.4 (USD 81.5).
Onvo’s mission is clear: not only to rival the Model Y but to shake up the traditional gasoline-powered SUV market with its battery-leasing strategy.
Executives have set their sights high. They’re aiming for the L60’s monthly sales to stabilize at 20,000 units—a lofty target for a fresh sub-brand. To support that ambition, Onvo organized a supplier meeting the day after the launch, rallying its partners to ensure a steady supply of resources. By year’s end, the brand plans to establish more than 1,000 battery-swapping stations and open 200 stores.
Looking further ahead, Onvo has more in the pipeline, including a six- to seven-seat SUV and another model slated for release within the next few years. The L60’s performance will set the tone for the brand’s future.
Onvo draws heavily from Nio’s established playbook, leveraging its parent company’s expertise across the board. The L60 is equipped with the “Coconut” system, built on Nio’s SkyOS operating system.
On the tech front, the SUV packs 30 sensors and Nvidia’s Orin X chip, delivering high-speed navigate-on-autopilot (NOA) capabilities right out of the gate. It’s not limited to highways either—full-scene NOA covers 726 cities and 2,700 county-level districts.
Efficiency is another key feature. The L60’s 900V platform, combined with a silicon carbide motor, delivers energy consumption of 12.1 kWh per 100 kilometers, matching Tesla’s efficiency levels.
Beyond battery-swapping stations, Onvo drivers gain access to over 23,000 Nio-operated fast chargers and more than a million third-party charging points.
The Onvo L60 is designed with family buyers in mind, offering features like low energy consumption, spacious interiors, and clever storage solutions, including a 52-liter fridge. But its real aim is to hit that ambitious goal of 20,000 units per month—a target currently achieved by only two other EVs in China: Tesla’s Model Y and Li Auto’s L6.
Without the battery, the L60 is priced RMB 43,000 (USD 6,020) lower than the Model Y, with Onvo hoping this price gap helps build its brand. Under the BaaS model, the L60’s starting price of RMB 149,900 lowers the barrier for buyers shopping in the RMB 200,000 (USD 28,000) range.
Onvo president Alan Ai (also known as Ai Tiecheng) emphasized this strategy, pointing out that the monthly battery rental under BaaS, combined with the founder’s edition perks, is roughly equivalent to a 60-liter tank of 92-octane gasoline. In other words, Onvo isn’t just competing with Tesla—it’s also taking aim at traditional gasoline SUVs.
No other automaker is currently using a BaaS model to reduce the upfront cost of an EV, which presents both opportunities and challenges for Onvo.
One hurdle is that the BaaS model can be difficult for buyers to fully grasp. They need to crunch the numbers and consider factors like promotions—”buy four months, get one free” and “60 free battery swaps”—to understand the long-term costs. Ai acknowledged this challenge, noting that customers may need time to get comfortable with the concept. Onvo plans to simplify its messaging around BaaS over time as the model gains traction.
Another question is whether buyers will accept the idea of paying RMB 600 (USD 84) a month for battery rental. Though the L60’s base price under BaaS is RMB 149,900, for buyers in the RMB 150,000 (USD 21,000) range, the monthly fee could stretch their budgets.
At the end of the day, Onvo is targeting consumers willing to spend RMB 200,000 on an SUV. But those buyers have plenty of established brands to choose from. Whether the L60’s strategy will succeed remains an open question.
Production and delivery pose additional challenges. Nio’s ET5 sedan faced significant bottlenecks after racking up over 100,000 orders but failing to ramp up production quickly enough.
To prevent history from repeating itself, Li emphasized that the company is doing everything possible to scale production to 20,000 units, with its factories running double shifts. According to the current plan, Onvo aims to produce 5,000 units in October, 10,000 in December, 16,000 in January, and 20,000 units by March next year. Nio’s two factories in Hefei are said to be prepared—one is capable of producing 10,000 Nio vehicles, while the other can handle 20,000 Onvo units.
“The automotive supply chain is particularly long,” Li said. “We have to ensure quality alongside volume. Supply is important, but quality is everything.”
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The following excerpts are from an exchange between various members of the media with Li and Ai. These excerpts were prepared by 36Kr and have been edited and consolidated for brevity and clarity.
Q: What’s the order status of the Onvo L60 after its launch?
William Li (WL): In short, it’s a hit. We had to expand the server capacity by five times. That day, I specifically instructed the team to scale up by fivefold, but even then, we had some lag. Overall, it’s been smooth—things really played out like that.
We don’t release monthly sales reports, but deliveries each month form the foundation of everything. All other data is secondary.
Q: It has been said that the production capacity for this year is capped at 20,000 units. Is there any plan to ramp up production?
WL: The numbers in our financial reports are typically conservative. Internally, we’re going all out to exceed 20,000 units. The vehicle manufacturing plant has already started double shifts, and production will ramp up gradually. The biggest challenge is improving quality across the supply chain, which takes time. No automaker in the world can produce 10,000 units in the first month—it’s just not how the industry works.
We’re confident about producing 5,000 units in October, 10,000 in December, at least 16,000 in January, and 20,000 units by March. Our two factories in Hefei are fully capable—one can produce 10,000 Nio vehicles, and the other 20,000 Onvo vehicles.
The automotive supply chain is complex. We have to ensure quality alongside volume. Supply is important, but quality is everything.
Q: What’s the current penetration rate of the BaaS model for Onvo?
WL: Nio’s BaaS penetration rate has always been above 80%, reaching as high as 90% at times. Some bank promotions slightly affected it. Currently, 97% of customers opt for the standard battery, with 3% choosing the long range variant. Given our network of battery-swapping stations and flexible upgrade services, users don’t need to carry a large battery all the time. This not only saves money but also conserves resources, extends battery life, and reduces future costs. Customers appreciate it.
The Onvo L60 is getting a lot of attention. Our competitors have tried different narratives—some say you’re just buying an empty shell. But in reality, RMB 206,900 covers the battery cost, with a lifetime warranty. If you prefer to rent the battery, the price drops to RMB 149,900. You can’t compare that to a RMB 250,000 (USD 35,000) Tesla Model Y—it’s nonsensical.
Q: Onvo is expanding rapidly into third- to fifth-tier cities, but its brand recognition is still growing. What is Onvo’s sales and channel strategy?
Alan Ai (AA): We’ve done a deep dive into preorder customers. Most of those considering the L60 have also looked at the Model Y, but not so much at joint venture models like the RAV4 or Tiguan L.
By using BaaS, we’ve entered the price range of fuel cars, opening up new opportunities. If users do the math, the monthly fuel cost for driving 1,500–1,600 kilometers in a 92-octane gasoline car is around RMB 810–850 (USD 113.4–119). Our battery rental fee, combined with founder’s edition perks, is equivalent to the cost of a 60-liter fuel tank of 92-octane gasoline.
The average driver uses about one and a half to two tanks per month. In our case, that’s covered by the monthly battery rental fee plus a couple hundred RMB for electricity. Our total monthly cost is lower than that of a fuel car. We’re better suited for third- and fourth-tier cities.
Q: Won’t some Nio customers switch to Onvo? How are you managing that internally?
WL: If that’s a concern, we suggest sticking with Nio. Nio’s vehicles have distinct characteristics—some balance business and family needs, while others are more business-focused. The ES6, for example, overlaps with the Onvo L60 in terms of family use, but in some aspects, the L60 is even better since it’s newer and designed for family scenarios.
That said, the two models are priced tens of thousands of RMB apart, and they cater to different markets. Nio’s main competitors are premium brands like BMW, Mercedes-Benz, and Audi, so the positioning is very clear.
AA: I’ve been tracking the preorder numbers, and as we approached the launch, only about 2–3% of Onvo buyers were owners of Nio cars. The vast majority are making additional purchases, not switching brands.
Q: Onvo and Nio will share battery-swapping stations. Won’t that strain resources and affect Nio’s user experience?
WL: Let me give you an example. Think about how smartphones work today. Have data speeds and communication gotten better, even though more people are using smartphones? It’s the network effect. Nio’s battery-swapping stations are based on a distributed system, and each station costs about as much as some Nvidia training chips. The bigger the network, the better the user experience.
Without Onvo’s volume, our “county-to-county” battery-swapping project would have been delayed by two years. Relying on Nio alone wouldn’t be enough to sustain it. In urban areas with high user density, when the numbers hit a certain level, we can easily add new battery-swapping stations based on data-driven decisions. There’s no need to worry about resource strain.
Q: The BaaS plan is clear, but there hasn’t been much discussion about buying out the battery after five years. What’s the plan there?
AA: We’ve prepared a buyout option, though we haven’t introduced it yet. Onvo is a new brand, which allows us to cast a wider net. But many customers need education on how BaaS works. If we overload them with information, it complicates things for our frontline teams. That’s why we haven’t rolled out the buyout plan yet, but it’s coming.
For now, if customers want to buy the battery, they can purchase the entire vehicle. If they prefer BaaS, they can rent the battery—it’s that simple.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Li Anqi for 36Kr.