Benzinga | Oct 15, 2021 03:51AM EDT

Nio Said To Increase Production Capacity By 20% At Hefei Plant, Aims For Another 100% Rise By Mid-2022

Chinese electric vehicle maker Nio Inc (NYSE:NIO) said on Friday it would be able to double annual production capacity at its Hefei facility in 2022, cnEVpost reported.

What Happened: The automaker, seen as a rival to Tesla Inc (NASDAQ:TSLA), said production at the site would double to 240,000 vehicles a year after a complete overhaul, which is expected to be completed in the first half of next year.

The automaker said it has been able to increase production capacity by 20% to 120,000 at the Hefei facility after completing a phased upgrade of its production line, which is being built in cooperation with state-owned automobile manufacturer JAC.

The Hefei facility can make sedan and sport-utility vehicle models. Following all the expansion work and with extra operating shifts, the plant would be able to make up to 300,000 cars a year, as per the report.

See Also: Nio Starts Construction Of Smart EV Industrial Park: What Investors Need To Know

Why It Matters: The expansion comes close to the heels of Nio's overseas expansion. The electric vehicle maker has started delivering cars in Norway and plans to make further inroads in Europe soon.

Demand for electric vehicles is expected to get a further boost in China where Nio is competing with homegrown rivals such as Li Auto (NASDAQ:LI), and Xpeng Inc (NYSE:XPEV) and global players such as Volkswagen AG (OTC:VWAGGY).

Price Action: Nio shares closed 0.11% higher at $36.28 on Thursday.

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Photo: Courtesy of Nio