$NIO(NIO.US)Let me talk about the biggest problem I see with NIO — the high cost of explanation.

NIO's battery swap logic is quite different from that of charging/range-extended vehicles. Charging/range-extended vehicles often focus on making the battery larger, fast charging faster, and maximizing range. A 100kWh battery with 5C fast charging and a highway range of over 350km is all about straightforward parameter stacking, which consumers can understand at a glance and find highly satisfying.

NIO's situation is much more complicated. NIO even tends to make the battery smaller and slow down fast charging because a smaller battery can lower the price and reduce vehicle weight, while slower fast charging helps extend battery life—after all, the battery is NIO's asset. So how does it address the resulting range issue? The answer is battery swapping.

This system is not inferior to the charging system and may even have advantages. The lightweighting from a smaller battery offers significant energy efficiency benefits in urban driving conditions (frequent start-stop). A smaller battery also lowers the price, as clearly demonstrated by the L90 on the 3.0 platform.

Beyond that, the battery swap system has financial and battery lifespan advantages. It can reduce insurance and purchase tax costs, avoid battery depreciation, and eliminate concerns about battery lifespan and technological obsolescence.

Sounds cool, so what's the problem?

The problem is that consumers don't understand it.

To consumers, they only know your battery is 60kWh, fast charging takes 40 minutes, and the highway range is 300km—that's a garbage car with all parameters losing.

They only know that BaaS sounds like a loan and have a natural psychological resistance to "paying rent for the car every month." BaaS is often mathematically cost-effective (considering capital costs and depreciation), but psychologically, consumers feel like they're repaying a loan and getting the short end of the stick.

Explaining this clearly to consumers requires them to have financial knowledge, which is a high barrier.

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