China EV maker Nio to spin off its battery production unit

Nio, the Chinese electric vehicle manufacturer (9866.HK), is reportedly considering the spin-off of its battery manufacturing division, as disclosed by sources familiar with the matter. This initiative is part of the company's broader strategy to achieve profitability, cut expenses, and enhance operational efficiency. The emerging battery unit, headed by experienced manufacturing engineers previously associated with Apple (AAPL.O) and Panasonic (6752.T), intends to attract external investors following the spin-off. This move is anticipated to take place as early as the conclusion of this year, with the valuation to be determined at a later stage, according to the sources. They requested anonymity due to the confidential nature of the information. Nio has chosen not to provide additional comments, aside from the remarks made by founder and CEO William Li during Tuesday's earnings call. Li mentioned that the automaker would persist in conducting in-house research and development on batteries but has now decided to outsource all manufacturing. With a current market value of $12.4 billion, Nio currently sources all its batteries from CATL (300750.SZ) and CALB Group (3931.HK).