Nio China
People gather at the booth of Chinese electric vehicle start-up Nio as it unveils its ES8 SUV at the Shanghai autoshow (Photo: Reuters / Aly Song)

China's answer to Tesla is reportedly now facing delivery problems, much like what its US counterpart was experiencing a year ago. Chinese firm NIO revealed that the delivery of its highly-marketed premium fully-electric SUVs crumbled last month, partly due to a voluntary recall it had to issue for its vehicle's built-in batteries.

According to the so-called Tesla of China, only 837 vehicles were delivered last month.

The delivered vehicles included the company's highly-touted electric models, the Nio ES6 and the larger Nio ES8. The number of deliveries for the month had dropped by a massive 38 percent when compared to the company's deliveries in June.

The company's CEO, William Li, mentioned in a statement that the drop in deliveries was mainly due to its voluntary battery recall. The recall significantly affected the company's overall production. The slump in overall car sales in China had apparently also brought down orders for the company's products.

Apart from domestic issues, the five-year-old Chinese electric startup is also now facing stiff competition from international players. Tesla has so far managed to take a foothold in the country.

The US-based electric firm has seen its sales numbers increase over the past quarters, bolstered by its huge investments and increasing interest from Chinese buyers.

For the second quarter of the year, Tesla has managed to deliver a total of 95,200 vehicles in China, a 51 percent increased when compared to its deliveries in the first quarter. Meanwhile, Nio has seen its deliveries drop by 11 percent in the second quarter.

Interest in Tesla's products had increased following the company's investment in building its own factory in Shanghai. The firm previously stated that it will be drastically reducing the prices for its China-made Model 3 sedans before the year ends as the vehicles will no longer be subjects to import tariffs.

Unlike Tesla, Nio has been experiencing the opposite for its investments and deliveries. The Chinese firm was forced to scrap plans of building its own factory in Shanghai back in March. The company also scarped plans to build an electric sedan in May after it reported worse-than-expected sales for the first quarter of the year.

Nio's stocks have also not been doing well in the markets. This week, the company saw its shared drop a further 2.6 percent to $3.05. Nio saw its stock drop during the first half of the year, with a sharp spike in July carried by news of Tesla's new vehicle deliveries in China. Nio listed in the US back in September of last year with an IPO priced at $6.25.