🧠 Food for thought

Implications, context, and why it matters.

Nio’s chip bet cuts reliance on Nvidia amid US sanction risk

• Nio’s first in-house chip, the Shenji NX9031, uses a 5-nanometer automotive-grade process 1.
• Its performance matches four Nvidia Drive Orin X chips, which power many Nio vehicles, said William Li, CEO of Nio 1.
• The effort also gives Nio cover if more U.S. export limits hit foreign chip supplies and slow self-driving work for Chinese carmakers 2.
• Nio reached its first profitable quarter in Q4 2025 after years of losses, so tighter cost control now matters more 3.

Nio’s plan also turns the automaker into a possible chip seller

• Nio spun off Shenji into an independent company and raised 2.3 billion yuan (US$330 million) from outside investors, creating a structure other automakers may study 4.
• That move shifts chip work from a large in-house cost into a business that could bring in revenue, since Nio may sell chips to outside buyers 4.
• The approach pressures Nvidia’s automotive business. William Li said Nvidia’s “very high gross margin” pushed Nio to build its own silicon 4.
• Nio plans to put the chips in its mass-market Onvo brand, giving it a route to spread savings beyond flagship models 5.