Nezha Shipping: It is expected that the production capacity of three overseas factories will reach nearly 100,000 vehicles next year.

On September 22nd, NIO held the first batch of NIO X delivery ceremony in Hong Kong. NIO founder and chairman, Yan Fengzhou, personally handed over the car keys to more than 40 local owners. Also attending the delivery ceremony were former Director of Innovation and Technology Bureau of Hong Kong, Honorary Taipan - Xue Yongheng, representatives from the Hong Kong Productivity Council, representatives from the Hong Kong Automotive Technology Research and Development Center (APAS), the general manager and department head of the automobile department of Da Changxing Automobile, as well as the Operation Director of F1 in Schools in Hong Kong and Macau, Mr. Andy Man, and principals of the four participating schools. During the delivery ceremony, Yan Fengzhou stated, "As the 'chain master' of the new energy automobile industry, NIO not only bears the responsibility of 'taking technology overseas' to drive the development of the entire local industry chain, but also actively fulfills social responsibility and is committed to cultivating the next generation of technology talents." In addition, NIO founder and chairman Yan Fengzhou, the general manager and department head of the automobile department of Da Changxing Automobile, Chen Qinhua, and F1 in Schools Operation Director in Hong Kong and Macau, Mr. Andy Man, participated in a media interview together. The following is a transcript of the media interview: Q1 Hong Kong Commercial Daily: It is an honor to witness the first domestic new energy automobile company holding a centralized delivery ceremony in Hong Kong. As a domestic emerging automobile brand, NIO has become the first enterprise to complete this centralized delivery in Hong Kong. What is the significance of this for the current development? Yan Fengzhou: I think there are three aspects worth noting: First, NIO is the first and currently the only domestic new energy automobile company with important departments such as international headquarters, research and development, and data center set up in Hong Kong, reflecting the importance of the Hong Kong market. At the same time, we actively respond to the government's call to introduce enterprises related to new energy vehicles. Second, as a financial and talent center, we hope to assist Hong Kong in becoming a technology center through the establishment of NIO, because new energy vehicles represent the future of technology and artificial intelligence. Through cooperation with domestic supply chain enterprises, we will bring our supply chain employees to Hong Kong to promote the development of the electronics industry. At the same time, we plan to conduct research and development on intelligent, environmentally friendly, and energy-efficient new energy vehicles in Hong Kong, allowing the advantages of technology to benefit future transportation. Lastly, NIO uses the advantages of Hong Kong to promote its global strategy. Our current overseas cooperation is also being expanded through the globalization center of Hong Kong to accelerate the development of the company. Q2 South China Morning Post: I would like to inquire more about NIO's plans in Hong Kong. First, NIO hopes to achieve a 15% market share in the electric vehicle market in Hong Kong within three years. What is the progress of this plan? In addition, the company mentioned plans to conduct an IPO in Hong Kong in June; is there now a clear timetable? Furthermore, Midea Group Co., Ltd successfully raised $4 billion in Hong Kong over the past week, how do you view the current confidence in the Hong Kong capital market? Yan Fengzhou: Firstly, we will accelerate the deployment of products in Hong Kong because Hong Kong is our international headquarters. For example, the NETAX showcased today, as well as the NETAAYA two models previously released, are important milestones in our research and development. Looking ahead, especially early next year, we will accelerate the launch of different products, including extended-range vehicle products, to allow consumers in Hong Kong to experience vehicles equipped with technologies such as intelligent driving and AI models in artificial intelligence. We are also accelerating the establishment of the R&D center in Hong Kong, attracting global talents, especially those in the field of artificial intelligence, to settle in Hong Kong. In terms of sales and market share, we hope to surpass the 15% target, and even more, because I believe NIO is building cars for the people. Our philosophy is to promote the development of high technology and allow global people, including Hong Kong, to enjoy the benefits of technology. As for the listing issue, we submitted the relevant application in June and it is progressing smoothly as planned. Hong Kong has a good market environment, such as the US dollar interest rate reduction, which is making more and more capital and investors optimistic about the manufacturing and technological advantages of Hong Kong and China. Therefore, we hope to attract more investors' attention, especially to the advantages of NIO's technology coming out to sea. We will proceed as planned, hoping to attract more investors in Hong Kong to benefit from the high-speed growth of the new energy vehicle market and the investment environment advantages brought about by going out to sea. Q3 Hong Kong Commercial Daily: Since 2021, new energy vehicles have actively explored overseas markets, and overseas revenue accounted for 12% last year. NIO ranked fifth in the export volume of new energy vehicles, exporting 16,400 vehicles. Has the overseas strategic plan been determined? How is the current progress of the strategy? In addition, how do you view this year's overseas revenue situation? Yan Fengzhou: According to our globalization layout established in 2021, Hong Kong has been established as a global center. With the rapid development of NIO automobile technology, we expect overseas revenue to grow by close to 30% this year, a progress rate that exceeds expectations. In the future, our layout will continue to focus on Hong Kong as a global center, and we have already made deep layouts in Southeast Asia, South America, Central and South America, and the Middle East and North Africa. In August, we launched three models in the Brazilian market, and the response was very good. A few days ago, we signed cooperation agreements with investment banks, related institutions, and local dealers in Mexico, indicating that our overseas development is accelerating. We started the strategy of going out to sea in 2021, and the layout from last year to the first half of this year has basically completed the first phase. For example, in Southeast Asia, we produce in two factories in Thailand and Indonesia; the Malaysian factory that we started building in the first quarter next year is expected to start production, and these three overseas factories are expected to produce nearly 100,000 vehicles to meet the sales demand of the entire Southeast Asian market. I believe that between next year and the following year, we will achieve the goal of the Southeast Asian out to sea strategy. In South America, especially in Brazil and Mexico, we are actively seeking opportunities for cooperation and development. Our current overseas development speed is accelerating.We are seeking cooperation with local enterprises, hoping to achieve significant growth of Nezha Motors in the South American market in the third quarter of next year, allowing South American consumers to experience our automotive technology and intelligent products. Additionally, in the Middle East and North Africa region, we have already made plans with customers and other countries. With this layout, we can quickly promote our car products overseas and accelerate the implementation of our internationalization strategy.Q4 Top Gear: As the largest car agent in Hong Kong, how do you view the development of the new era of electric cars? Chen Qinhua: Da Chang Xing Automobile has been rooted in Hong Kong for 75 years and is beloved by Hong Kong people. We are pleased to cooperate with Nezha Automobile because they have rich experience in technology, and we are very familiar with the Hong Kong market, which makes the cooperation smoother. In addition, the automotive industry is not just about buying and selling vehicles, it also includes customer after-sales service, charging facilities, and even battery recycling. The entire industry chain has an impact on the electric vehicle market in Hong Kong, and we hope to provide more quality services and products for our esteemed customers. Q5NIKKEI: First of all, do you think it is a critical period for Chinese car companies to survive in the current era? Many opinions have suggested that over 80% of new energy vehicles cannot survive within 5 years. Do you think Nezha Motors can still survive in the next 3 to 5 years? If you do, what makes Nezha Motors unique? Additionally, considering the tense political relations between China and the US and China and Europe, will trade restrictions affect Nezha Motors' development in overseas markets? Fang Yunzhou: The automotive industry is a niche market with a long history of over 100 years of development, and each country typically has 3 to 5 or more traditional car brands. With the rise of new energy vehicles, new technologies are constantly increasing the requirements for user experience, so customization of smart cars will become more important as market demand grows. The increasing demand for niche markets poses greater challenges for companies to monopolize the market. Only brands with unique products can gain an advantage, and the development of automotive brands often experiences ups and downs. When one or more products perform well in the market, the company can achieve rapid growth. The automotive industry requires a longer period to evolve. There are three key elements to achieving sustainable development for a company. The first is technological innovation, where companies need to guide user habits, similar to the impact smartphones have on new users, smart cars also need to make progress in this area. For example, AYA and X cater to different niche markets, so technological innovation directly impacts each segment. The second factor is providing quality customer service, managing customers effectively to meet their needs, and thereby enhancing the brand image. The third element is safety. While safety is often seen as a hidden factor, it directly affects the user experience, as cars carry people's lives. In comparison, phones or electronic products do not need additional proof of safety. Therefore, the safety of cars must be paramount, and users will gradually accumulate brand value through word of mouth after use. Regarding trade restrictions in European and American markets, the global market is vast, involving five to six billion people. The potential for growth is better in the regions of Asia, Africa, and Latin America which have larger and younger markets. Of course, Nezha Motors is also considering entering the European and American markets, as long as the products, technology, and safety quality meet the standards, just like the key elements mentioned earlier, and adapt to the needs of local users, customers will naturally choose to purchase. This depends on the timing and pace. We are also researching products for the European and American markets, as product experimentation requires two years of development in advance. We have developed relevant products in Europe with our partners, and products for the American market are also in development. We look forward to entering the market through partnerships or other means. Once the products are ready, we will develop a strategy for overseas expansion, adapting to local conditions and cooperating with local partners, such as the partnership with Da Chang Xing Automobile, aimed at benefiting various sectors and the industry chain from the rapid development of new energy and smart cars. We hope that all participants in each link can share the benefits, rather than just one party profiting. Therefore, we are actively considering development opportunities in Europe and the United States. Q6 In recent years, various new energy vehicles from different forces have entered the Hong Kong market. What makes Nezha Motors unique compared to other brands? Additionally, what is the significance of Nezha Motors' cooperation with F1 in Schools? How will this cooperation help students in their future development? Fang Yunzhou: Nezha Motors' main user group is young people, and the brand name comes from the young image and symbol of fire in Chinese mythology. China has had the idea of travel innovation for a long time, so we define our users as younger. For example, the design of the vehicles, their intelligence, and the intelligent cabin inside the car are loved by young people. Currently, about 60% to 70% of our user base are young people, and the preferences of parents are also evolving. About 2,000 users are adapting to the needs of young people through innovation, as young people have a strong acceptance of new things. The demonstrations today, including the intelligent cabin inside the car, artificial intelligence technology, AI technology, and voice interaction, are all aimed at providing a better experience for young people, meeting their expectations for new travel technology, and allowing them to enjoy the pleasure of driving. Andy: It is a pleasure to cooperate with Nezha to help the younger generation to develop better. Nezha is a company that focuses on technological research and innovation. F1 in Schools will teach students how to develop miniature race cars and related business knowledge, such as presentations and market research, hoping to integrate Nezha's innovative elements into the curriculum to help students achieve excellent results in the competition. Fang Yunzhou: The cooperation with F1 in Schools is aimed at allowing young people and students in Hong Kong to experience smart car technology and feel the future and innovation represented by technology. We hope to cultivate them from a young age and make them the backbone of Hong Kong's future. Q7 GMTEight: Regarding customer management, currently many car companies establish reputation through various activities. How does Nezha Motors manage its reputation in the market and what measures are taken to improve after-sales service? Fang Yunzhou: Activities or advertising are for the user experience, which is a means and not something that truly smart cars need. In the future, smart cars will provide users with experiences and needs that do not need to be achieved through activities or using communication. Product innovation or technology is the flow is needed for this effect.Attributes, after users try them out, naturally spread like smartphones. This is the core competitive advantage that I emphasize in products, so Nezha cars rarely engage in extensive advertising in their promotions. We hope that our products can speak for themselves, have core competitiveness, and users can share them after using them. Cars are the intelligent mobile terminal of the future Siasun Robot&Automation, and users will spread the word after using them. Their own dissemination may be better than promotions, so we actively focus on the expansions that need to be done. The core competitive advantage of this product guides the market and creates user functionality.Regarding the innovation of products and core technological competitiveness, Nezha Motors has established a research and development center in Hong Kong. May I ask what specific characteristics your company has in terms of technical advantages or differentiation? In addition, what features of the cars delivered this time have been found to be more popular among Hong Kong consumers in market research? For example, chip car systems, range and charging mileage, etc., could you please provide more details on these designs? Fang Yunzhou: Nezha Motors has always insisted on technological innovation, and we are in a leading position in the field of central supercomputing. Our intelligent central supercomputer is expected to be put into use at the end of this year or in the first quarter of next year. This may be the first truly central supercomputer in a Chinese enterprise, with only one "brain" equipped in the car, consolidating the functions of intelligent driving, cabin, and control calculations that were originally managed by several controllers into one system, thus putting us far ahead in this field. The second technology is the skateboard chassis CTC technology we use, which is also the first truly implemented globally. We represent true third-generation technology, which means that supercharging functions are integrated on one chassis, supporting various types of vehicles such as SUVs and sedans. Thirdly, we have achieved pure electric range levels of 300 km, 400 km, 500 km, 600 km, and 700 km, truly meeting users' daily needs. The longest range of extended range vehicles exceeds 1300 km, and the pure electric range of extended range vehicles exceeds 300 km. About 95% or even 98-99% of the time, users travel in pure electric mode because the average daily travel distance is generally around forty to fifty kilometers, totaling about 300 kilometers per week, so over 95% of the time is spent driving electrically. When occasionally taking long trips, our models can also meet the needs. We have proposed the concept of "charging once a week, using one tank of gas every six months," achieving true super extended range technology. Fourthly, we are applying the latest artificial intelligence and large model technology to our products through partners and shareholders. These four aspects put us in an absolute leading position in the industry. In terms of market competition, we have developed a series of high-performance, cost-effective products, truly achieving equal rights in technology, allowing high performance and high intelligence to win market reputation. Furthermore, in battery technology, we have been committed to the development of electrification for 20 years and have partnered with Contemporary Amperex Technology to inherit technological value, ensuring that we remain in a leading position in the industry. Our customized technology application efficiency is high, maximizing safety and battery performance in various scenarios. For example, the range of models similar to AYA can reach levels of 350-380 kilometers, while the X model can achieve a range of 400 to 500 kilometers, showing outstanding and leading performance in unit battery range.