Chinese electric vehicle maker Nio (NYSE: NIO) has spent the past several years trying to answer the same question: Can it grow fast enough to eventually become profitable?

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Recent delivery numbers suggest the company may finally be making progress.

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In May 2026, Nio delivered 37,705 vehicles, representing a 62.3% year-over-year increase and a 28.4% increase from April. The result marked one of the company's strongest monthly performances on record and pushed cumulative deliveries to more than 785,000 vehicles since inception.

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The growth wasn't driven by a single model, either.

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Nio's expanding portfolio now includes vehicles sold under the premium NIO brand as well as its newer ONVO and Firefly brands. Together, these brands are helping the company target a broader range of consumers across China's highly competitive EV market.

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A broader strategy

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For years, one of the biggest criticisms of Nio was that it remained too dependent on a relatively small number of premium-priced vehicles.

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Management appears to be addressing that issue.

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The launch of ONVO gives Nio exposure to the mass-market segment, where companies like Tesla (NASDAQ: TSLA) and BYD (OTCBB: BYDDY) have generated enormous sales volumes. Meanwhile, Firefly targets smaller and more affordable vehicles, potentially opening another avenue for growth.

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This matters because scale remains one of the most important factors in the EV business.

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Vehicle manufacturing requires substantial upfront investments in factories, research and development, software, batteries, and supply chains. As production volumes increase, those fixed costs can be spread across more vehicles, helping improve profitability.

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Nio has already begun showing signs of progress on that front.

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During the first quarter of 2026, the company reported vehicle deliveries of more than 42,000 units and continued improving operational efficiency. Vehicle margins have also recovered significantly from the levels seen during the industry's pricing war in 2023.

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The battery-swapping advantage

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Another factor that differentiates Nio from many competitors is its battery-swapping network.

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Rather than requiring drivers to recharge, Nio allows customers to exchange depleted batteries for fully charged ones at automated swap stations. The process typically takes just a few minutes.

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The company now operates thousands of battery swap stations across China and continues expanding the network.

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More importantly, battery swapping allows Nio to offer its Battery-as-a-Service (BaaS) model, which reduces the upfront cost of purchasing a vehicle while generating recurring revenue opportunities.

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Previous company disclosures indicated that more than 90% of ONVO buyers selected the BaaS option, suggesting strong consumer acceptance of the model.

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