Originality key to building premium car marques

Nio CEO William Li has warned that one cannot succeed in building a premium car brand by copying from others, even as Chinese EV makers are seizing a growing share of the market once exclusive to established German giants.

"What's critical is originality — in technology, in products, and in how you run your business," said Li at a recent forum organized by industry news portal Auto Report.

Li pointed to Nio's recently unveiled ET9 sedan showcased at the Shanghai auto show in April as a symbol of the company's independent development. "It features the highest level of in-house originality among all the models on display," he said.

Nio has long positioned itself as China's answer to BMW in the era of smart electric vehicles.

Although its sales volumes remain modest, the company has attracted a loyal customer base that includes former owners of established premium brands thanks to its emphasis on user experience and brand identity — from battery-swapping infrastructure to exclusive customer clubs.

"I have great respect for Mercedes-Benz, BMW, Audi and Porsche, but what we do is original — we don't imitate," said Li.

Li's words come as Chinese carmakers are taking on those global premium brands and even trying to define the new standards of luxury.

A McKinsey survey of 2,498 Chinese car owners earlier this year shows that owners of premium Chinese EVs are more satisfied in all seven aspects including comfort, price and comprehensive experience, compared with those of gasoline cars from overseas premium brands.

Many Chinese models boast sleek designs and advanced features, but growing homogeneity in styling and tech is raising concerns about long-term differentiation.

At the same time, imitation has become a go-to tactic for some newer entrants. One of the most controversial ones is the Xiaomi's SU7, which bears a striking resemblance to Porsche's Taycan. Xiaomi executives have described it as a homage to the German sport car brand.

That tactic, though controversial, has proven effective. Deliveries began in April 2024, and it quickly became the best-selling model from any new energy vehicle startup, with 135,000 units sold by year's end.

Smart technology is another aspect that has been driving the sales of local Chinese brands.

The M9 by Aito, a brand codeveloped by Huawei and Seres, has been the best-selling SUV priced at over 500,000 yuan ($69,444) in China since its launch in late 2023, primarily because of its smart driving system from Huawei.

But analysts say tech alone will not sustain a premium brand identity. Huawei is now licensing its smart driving solutions to other automakers including Audi, which could erode early-mover advantages.

Qin Peiji, head of Lotus Cars' China operations, said smart technology, which many Chinese brands pride themselves on, is not enough to build a long-term premium reputation.

"I would say it is one element … premium brands always offer something emotional besides its products … building a brand is a long-term job," said Qin, who was a senior Volvo executive, at the same forum.

Li echoed Qin's words, saying that the reason such brands as Mercedes are respected is "they have stood the test of time".

Yet he insists that a premium brand should offer an "evolving, end-to-end experience" from its technology and products to service and customer communities.

"If you don't keep up with the times, you risk becoming a relic of the past. Some people may be nostalgic about you, but you are no longer a vibrant premium brand," said Li.

This is getting clearer in the Chinese market. McKinsey analysts noted that the perception of legacy brands as premium remains strong, but that "is not translating into car buyers' willingness to pay more for it".