(Bloomberg) -- Nio Inc. reported a quarterly loss and an outlook on revenue and electric-vehicle deliveries that missed estimates, while the company is working on further cost-cutting and sales-boosting measures.

The Chinese EV maker now projects revenue of up to 16.7 billion yuan ($2.3 billion) in the three months through December, short of the 21.4 billion yuan average estimate from analysts. It expects to sell as many as 49,000 vehicles in the quarter — well below analysts’ average forecast of 59,426. 

Once considered one of the brightest rising stars in China’s EV market, Nio has yet to post a profit and is falling behind its targets. It had a goal of shipping 250,000 EVs this year, but through November it had only shipped 142,026. 

“We have identified opportunities to optimize our organization, reduce costs and enhance efficiency,” Chief Executive Officer William Li in the statement. He added that management is “confident in Nio’s long-term competitiveness.”

The EV manufacturer will cut or postpone projects that cannot improve the company’s financial performance in three years, Li said in an earnings call on Tuesday. For example, it will continue in-house development on cells, battery materials and packs, but will outsource production. Together with recent headcount cuts, Nio is looking to reduce expenses by around 2 billion yuan in 2024.

The company cut 10% of its workforce in November and has considered spinning off non-core businesses to reduce costs, even after an Abu Dhabi government-backed investment fund injected nearly $740 million in June in return for a 7% stake. Nio also sold $1 billion of convertible bonds in September, and Bloomberg News reported it was considering raising a further $3 billion from investors. 

In addition to its long-term investment for core technologies, Nio will also continue to develop its sales and service networks, which is an area where the company is adding staff. Currently, it has around 5,700 workers in sales, with more than 3,000 of these being new hires.

Nio’s New York-listed shares rose 3.7% at 10:34 a.m. after the company executives detailed the cost reduction plans. The stock has declined more than 20% this year, trailing the performance of rival Chinese EV maker Xpeng Inc., which has rallied 63%, and Li Auto Inc., up 76%. Nio fell 69% in 2022 and 35% in 2021 after surging more than 1,000% in 2020. 

Read More: Nio Has Been at the Brink Before. Can the EV Maker Rally Again?

Nio, founded in 2014, has splashy showrooms with exclusive lounge-like spaces called Nio Houses where EV owners get complimentary beverages and can join social events. Other membership-like benefits include free battery-swapping, charging and roadside assistance.

The Shanghai-based company is striking deals with rivals to boost revenue. It recently signed agreements with Chongqing Changan Automobile Co. and Geely Automobile Holdings Ltd. to partner on battery-swapping technology. The company will not rule out the possibility to separately fund or list its power swap business, Li said. 

Third-quarter revenue rose 47% from a year earlier to 19.1 billion yuan. Vehicle margin, which measures the profitability of its most recent car sales, returned to double digits in this quarter. The company sees that measure improving to 15% in the fourth quarter and as much as 18% in 2024, according to the earnings call.

Nio also said it will pay 3.2 billion yuan to acquire manufacturing equipment and assets from Anhui Jianghuai Automobile Group Corp., which has helped produce the company’s EVs. Nio has just been approved by the government to make automobiles independently. The overall manufacturing costs will be reduced by around 10% if Nio takes production fully in-house, Li said.

--With assistance from Kelly Gilblom.

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