Geely profits surge on record sales as reshuffle underway

For more automotive coverage and exclusive interviews, subscribe to our weekly Cars & Culture newsletter. You will receive the latest in EV's, F1, design, automotive culture and collaborations — delivered straight to your inbox. Geely Automobile Holdings, the Hong Kong-listed unit of billionaire Li Shufu’s sprawling auto empire, said first-quarter profit surged as sales climbed and it continued on a cost-cutting drive to stay on top of China’s ultra-competitive car market. Net income more than tripled to 5.67 billion RMB ($786 million) in the three months ended March 31, from 1.56 billion RMB a year earlier, the company said in a statement today. That was broadly in line with guidance the company provided last month following a change in its accounting policy. Revenue rose 25% to 72.5 billion RMB. “The group achieved record-high sales and experienced strong growth in its new energy business,” the company said in the statement. “This led to significant scale effects and a substantial increase in overall profitability.” Zeekr privatization signals business consolidation Geely Auto earlier this month announced a bid to take premium electric car brand Zeekr private. The move, which came almost exactly a year after Zeekr started trading in New York, values Zeekr at about $6.4 billion and is part of Li’s drive to streamline his business empire — which also includes stake in Volvo Car, iconic UK sportscar brand Lotus, and the maker of London’s ubiquitous black taxis. Zeekr’s losses narrow as brand integration deepens Separately, Zeekr today reported a first-quarter net loss of 718 million RMB, narrowing 63% from last year. Total revenue was largely flat, increasing just 1.1% to 22 billion RMB. Zeekr merged with the Lynk & Co connected car brand earlier this year, and the period was the first quarter with the full integration of the two marques, Zeekr Group Chief Executive Officer Andy An said. “The two brands’ initial technological consolidation has already boosted profitability through optimized R&D and shared platforms,” An said. Geely recorded net current liabilities of 11.3 billion RMB, but said that after a comprehensive assessment, this has no significant impact on its ability to continue, because the business continues to generate stable cash flows, has good relationships with financial institutions and is carrying out plans to improve liquidity, it said. Domestic growth surges, exports slow amid trade tensions Geely continues to enjoy strong growth in China, with deliveries rising 48% in the first three months of this year. Popular models such as the electric Xingyuan hatchback and Xingyue L sport utility vehicle are among the best-selling vehicles in the world’s largest auto market. But like other Chinese automakers, Geely is facing stiff trade headwinds. The European Union’s tariffs on Chinese EVs and the increase in taxes on car imports and weak consumer sentiment in Russia — where Geely is a top seller, are impacting exports. Overseas deliveries grew just small 2% in the first quarter, compared with a 66% surge in a year earlier, according to a separate company filing in April. By Linda Lew

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Geely profits surge on record sales as reshuffle underway