- Zeekr will gain a controlling share of Lynk & Co and access to its dealer network.
- There is currently overlap between Zeekr and Lynk and parent company Geely wants to streamline the business and cut costs.
- It will act as Geely's research, development and innovation leader sharing its technology with the group's 12 brands.
Geely wants to streamline its business and maximize its competitiveness by putting Lynk & Co under the control of Zeekr. The company has now decided that Zeekr will gain a controlling 51% stake in Lynk & Co, currently valued at $2.5 billion, to improve coordination between the two brands and eliminate the overlap that currently exists between some models. Employees from both companies will answer to Zeekr CEO Andy An.
By doing this, Geely hopes it will increase the combined sales of the two brands to over 1 million units annually, up from 340,000 sales last year. Making these companies operate more efficiently is the key in an increasingly competitive market, and Geely is positioning Zeekr as the group’s innovation leader which will share its technology with the group’s 12 brands, which include Volvo, Polestar, Smart and Lotus.
According to Geely CEO Gui Shengyue, “If we don’t integrate (Zeekr and Lynk), we must face issues such as internal competition ... and redundant investments in many aspects such as R&D, sales, which is stupid.” Geely hopes that by putting the two brands under the same management, it will cut research spending by up to 20%, according to Automotive News.
Zeekr vehicles will also become available through the existing Lynk & Co dealer network to expand availability to cities where it wasn’t present before. Like many Chinese car brands these days, Zeekr is analyzing the possibility of manufacturing cars in Europe to avoid the steep new import tariffs on Chinese EVs implemented at the start of the month.
Even though Geely is an important player on the global automotive scene, in recent years it’s been overshadowed by the rapid ascent of BYD, which went from selling under 500,000 vehicles globally in 2021 to selling over 3 million in 2023. That’s almost double what Geely managed in 2023. However, the manufacturer is expected to exceed 2 million sales in 2024 thanks to 32% higher sales in the first three quarters of the year—it’s already surpassed last year’s result with two months to go.
Both Lynk & Co and Zeekr are already selling cars outside China. If you fly into most large European cities, you will likely see Lynk & Co 01 plug-in SUVs available as rentals, and there are already plenty of privately owned examples too. Zeekr is also present on the continent, delivering its first car to a Dutch customer in early December of last year. It now offers two models, the 001 fastback and the X compact SUV (basically Zeekr’s equivalent to the Volvo EX30, with which it shares its platform).
Zeekr was also listed on the NY stock exchange in May of this year, and its shares have climbed 40% since, allowing it to reach a market value of $7.3 billion. The move by Geely to reorganize its brands was likely prompted by the ongoing price war between Chinese automakers that have become increasingly competitive and aggressive in their pricing strategies.
