NEW YORK -- Chinese electric vehicle maker NIO will accept an investment of up to 10 billion yuan ($1.45 billion) from a state-owned fund, as the company braces for further blows from the gradual phaseout of EV subsidies in China.

The Shanghai-based, New York-listed company announced on Tuesday it has entered into a framework agreement with Beijing E-Town Capital to establish a new entity, NIO China, in the city's economic-technological development area. E-Town Capital, which invests on behalf of the Beijing municipal government's economic development agency, will acquire a minority stake in NIO China.

The new entity will operate the automaker's main China business and open up yuan-based fundraising channels for the company.

The investment reflects China's continued ambition in the EV industry, even as the government is slashing subsidies. E-Town Capital lists "new energy smart car" as one of four industries it sets out to promote. It has also invested in projects including a joint facility with EV manufacturing capabilities between Germany's Daimler and BAIC Motor in the development zone, as well as BAIC BJEV, the electric vehicle unit of BAIC Group.

In late March, China's Ministry of Finance announced a new EV subsidy scheme with the intention of eventually eliminating such financial support to encourage the survival of the fittest in the industry. Effects of the cuts were immediately felt. NIO, which reported quarterly results Tuesday, experienced a worse-than-expected slowdown in deliveries of its ES8 car in April.

Subsidies for ES8, NIO's first -- and until Tuesday, only -- mass-produced vehicle, were cut by 40% to 40,500 yuan per vehicle from 67,500 yuan in 2018. That means consumers now have to pay 27,000 yuan more, or nearly $4,000 more than they did a year ago. Subsidies will be further reduced to 11,500 yuan beginning this June.

Macroeconomic concerns in China, exacerbated by the Sino-American trade war, as well as cannibalism from orders for the ES6, which started mass production Tuesday, were also to blame, NIO said.

"Looking ahead to the second quarter, we expect an even more challenging sales environment and anticipate overall sequential demand and deliveries to decrease, as competition continues to accelerate and the general automobile market in China remains muted," Louis T. Hsieh, NIO's chief financial officer, said in a statement.

NIO sold 3,989 cars in the first quarter of 2019, less than half it did in the fourth quarter of last year.

Revenue beat Wall Street expectations, but NIO suffered a net loss of $390.9 million, a 71.4% increase on the year. As of March 31, NIO had $2.58 billion in total liabilities, up more than 60% from a year ago. To contain operating costs, NIO has laid off 4.5% of its workforce, cut research and development spending, and closed an office in San Francisco.

The 10 billion yuan investment from Beijing E-Town Capital will be used primarily to support R&D and user network improvement, NIO Vice President of Finance Nick Wang said in the company's earnings call. E-Town Capital is also expected help support NIO's efforts to build or find third-party partners to construct a new manufacturing facility for its next-generation platform 2.0 vehicles in the development zone.

Currently, NIO builds its cars under an arrangement with JAC Motors, a state-owned vehicle manufacturer, at a joint plant in Anhui Province. In 2017, NIO signed framework agreements with the Shanghai government to build its own manufacturing plant in the city's Jiading district. But the EV maker announced in March that it has dropped this plan.