The European Union Intellectual Property Office (EUIPO) announced its decision on February 21st 2022 to reject two lawsuits filed by the German automotive giant Audi’s against the Chinese electric vehicle maker NIO. The claim of Audi, that the Chinese competitor’s electric SUV model es8 / es6 are visually similar to Audi’s flagship sedan model S8 / S6 and therefore lead to trademark infringement, has been dismissed by the EUIPO.
The latest EUIPO ruling is a dramatic overturn in the lengthy legal dispute and a milestone for the 9-year-old premium EV startup from China. Founded by the Chinese internet veteran William Li in 2014, NIO delivered its first electric SUV model es8 in year 2017 and achieved IPO on Nasdaq the year after. The brand started to sell in Norway in 2021 and launched its official European market entry in October last year.
Audi, the luxury vehicle brand under Volkswagen Group, began to take NIO as a serious competitor in premium EV sector. The German automotive giant filed a trademark removal request against the Chinese newcomer at EUIPO in October 2021, claiming that the es8 / es6 models of NIO would invoke a strong association to the S8 / S6 lines of Audi, implying an “electric version of S8 / S6” to potential vehicle buyers. Audi further argues that, the letter-number-combinations have a historic value and distinctiveness, which separated the underlying vehicles from competitors. If the company had not marketed using the S8 / S6 model name, it won’t have been able to sell as many vehicles over the last two decades.
Audi requested the EU patent authority to cancel the es8 / es6 trademarks registered by NIO in 2016 – twenty years after Audi registered its S8 / S6 trademarks.
NIO argues that the two model names are conceptually different and visually not similar. Due to that fact that there are numerous letter-number-combinations in the automotive market, potential car buyers would never make the purchase decision solely based on model names.
The case took EUIPO 16 months to review. In between, Audi filed another case against NIO at chamber for commercial matters at court of Munich in July 2022, seeking to ban NIO from using es6 / es8 model names in Germany plus a damage compensation. The local court preliminarily ruled on 19th January 2023 in favor of Audi, supporting its argument that German consumers would be confused by the es6 / es8 model name of NIO and wrongly assume the vehicles are electric incarnations of the Audi S6 / S8 series.
European Union Intellectual Property Office, on the other side, found no solid support to Audi’s claim. “Consumers with at least an average level of attention will notice the differences between the two model names … and will certainly be able to distinguish between the brands.” EUIPO sees no potential risk of confusion, “especially for products such as motor vehicles”, where consumers are well-informed and “pay a high level of attention before a purchase”.
To NIO, the ruling has a more symbolic meaning. As precaution to the trademark disputes, the company has already renamed its latest SUV models from es7 to “el7” in European markets in October last year. Throughout 2022, the EV newcomer from China reported 122,486 new vehicle deliveries world-wide, increasing by 34.0% year-over-year, and European market will play an important role in the company’s global strategy. Earlier this month, the European Parliament gave its final approval to a ban on new sales of carbon-emitting petrol and diesel cars in the EU by 2035. The market is already seeing an increasing number of Chinese electric carmakers and battery suppliers entering the battleground, in anticipation of the EV boom in the upcoming years.
