Recent developments, such as Volkswagen's investment in XPeng and Stellantis acquiring Leapmotor, signal the beginning of a broader restructuring.
High-profile failures like HiPhi’s bankruptcy and Neta’s financial troubles foreshadow the shakeouts to come, with 2025 expected to be a critical year for the survival of new energy vehicle (NEV) players.
Geely’s Bold First Move
Geely, owning the largest portfolio of automotive brands in China, has taken the lead by merging Lynk & Co into the newly listed Zeekr.
The goal? To create Zeekr Technology Group, an NEV powerhouse capable of achieving annual sales of over one million units within two years.
Lynk & Co, initially a premium brand born from a joint venture between Geely and Volvo, was the cradle for Zeekr’s early NEV projects.
Today, Zeekr’s rapid rise seems a natural progression within China's evolving automotive market. Yet, beneath this surface lies Li Shufu’s brilliance in execution.
Dual-Engine Synergy: ZEEKR and LYNK & CO
The initial integration of Zeekr and Lynk & Co resembles an automotive alliance model.
Zeekr acquired a 51% stake in Lynk & Co, forming Zeekr Technology Group while preserving both brands’ independent operations in marketing, sales, and after-sales services.
However, the backend functions—R&D, manufacturing, and procurement—will be fully integrated. This arrangement mirrors the relationship between Toyota and Lexus, with a high likelihood of deeper unification in the future.
Standalone operations for both Zeekr and Lynk & Co are unlikely to yield competitive advantages in scale or profitability.
With Lynk & Co transitioning to plug-in hybrid electric vehicles (PHEVs) and exploring the pure EV market, and Zeekr planning to launch range-extended hybrid models, the two brands risk internal competition.Products like the Lynk & Co Z10 and Zeekr 001 already show signs of overlap.
Through the merger, internal conflicts can be mitigated, and shared resources—already overlapping in many areas—can be better leveraged.This creates a stronger, unified NEV brand capable of achieving 1+1 > 2 effects.
Just as BYD leverages its dual-technologies (PHEV and BEV) and dual-brand strategy (Dynasty and Ocean series) to dominate the Chinese market, Zeekr and Lynk & Co must achieve similar cost and efficiency advantages to survive the highly competitive landscape.
A Long-Term Vision Rooted in Strategic Acumen
Li Shufu’s track record of foresight can be traced back to Geely’s landmark acquisition of Volvo, a move that baffled many at the time.
Today, Volvo not only operates profitably but also serves as a key pillar for Geely’s global ambitions, giving rise to Lynk & Co as one of China’s most successful premium brands.
As China accelerates its transition to electrification and smart mobility, Lynk & Co’s NEV projects evolved into Zeekr, which debuted with its flagship Zeekr 001.
Initially experimental, Zeekr has since surpassed all expectations, outperforming Lynk & Co in both pace and scale.
By November 2024, Zeekr delivered 27,011 vehicles, a 106% year-on-year increase, with cumulative sales nearing 400,000 units. This is a stunning leap for a brand that, just a year ago, relied heavily on a single model—the Zeekr 001.
Meanwhile, Lynk & Co achieved monthly sales of 32,679 vehicles, up 9% year-on-year, with NEVs accounting for 61% of sales and a total cumulative volume exceeding 1.31 million units.
The rapid success of Zeekr has emboldened Li Shufu to launch the Galaxy NEV series, directly challenging BYD in a highly competitive battle.
The Urgency of Integration
Historically, brands like Geely, BYD, Chery, and Great Wall began as underdogs competing against joint ventures.
Over time, Geely transformed into a leader among domestic automakers, acquiring Volvo, Proton, and the Smart brand, and collaborating with Renault on hybrid technologies.
Yet, its sprawling portfolio of brands has created inefficiencies and internal rivalries, making consolidation an urgent necessity.
China's automotive competition now resembles navigating treacherous waters amid turbulent waves.
BYD has overtaken Geely and even FAW-Volkswagen, achieving an annual output of 4 million vehicles to claim the top spot.
Meanwhile, Chery continues to dominate exports while growing its domestic market share across fuel, PHEV, and BEV segments.
Geely must rise to the challenge by building a unified "Big Geely." Li Shufu’s move to consolidate Lynk & Co and Zeekr under Zeekr Technology Group reflects his strategic genius.
Lynk & Co and Zeekr share the same technological DNA but were previously separated by corporate structures and Volvo’s involvement. This fragmentation wasted time and resources.
By consolidating them into Zeekr Technology Group, Li Shufu seeks to replicate the dual-brand success of Volkswagen (FAW-VW and SAIC-VW) and Toyota (FAW-Toyota and GAC-Toyota).
Much like BYD’s Dynasty and Ocean networks, Geely now has two "armies"—a traditional ICE and Galaxy NEV division under Geely Auto Group and an NEV-centric division under Zeekr Technology Group, encompassing plug-in hybrids (Lynk & Co) and pure electrics (Zeekr).
In the face of fierce competition and inevitable challenges, this strategic restructuring positions Geely to navigate the next storm, move faster, and emerge victorious.
Li Shufu’s vision demonstrates not only boldness but also the foresight necessary to ensure Geely’s long-term success in a rapidly changing market.（Translated by ChatGPT）
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