Nio hopes to enter the mass market with two sub-brands, while BYD will enter the premium market with two new brands.

BYD's strategy is similar to Nio's, although the two are on opposite paths.

Nio is now gaining a foothold in the Chinese premium market, with vehicles priced on average RMB 100,000 higher than Tesla vehicles in China.

For the mass market, Nio was previously rumored to be launching two new brands, which was confirmed by William Li, the company's founder, chairman and CEO, during an analyst call following the release of its third-quarter report earlier this month.

Nio has two new brands in development, as well as business investments including cell phones. The company will invest RMB 3 billion to RMB 4 billion in new businesses next year, or about RMB 1 billion per quarter, he said.

For the mass-market sub-brands, Nio hopes to sell 50,000 units a month, Li said at the time.