Zeekr acquires majority stake in Lynk & Co

The state-run newspaper Economic Daily from China reported that Geely wanted to consolidate its brands for new energy vehicles. According to unnamed informants, Geely-internal Zeekr is to acquire a majority stake in Lynk & Co. A formal announcement will be made shortly, it is said.

This is exactly what has now happened, albeit indirectly: Geely subsidiary Volvo Cars, which founded Lynk & Co as a joint venture with the Geely Group in 2017, announced on Thursday morning that it would sell its 30 per cent stake internally to Zeekr. The purchase price is 5.4 billion yuan (710 million euros) – 70 per cent of the sum will be paid immediately and the remaining 30 per cent plus interest will be paid one year after the transaction is completed, Volvo said.

“The sale is in connection with a new development phase of Lynk & Co, which envisages a new ownership structure for the company. Volvo Cars will continue to focus on operational cooperations with Lynk & Co in selected markets where there is a strategic benefit for both companies,” the Swedish company said in a statement.

Geely itself also confirmed the report a few minutes after Volvo: “The proposed move aims to accelerate technology synergies between the two brands, streamline product portfolios, and boost talent development, ultimately leading to greater global sales volume,” Geely said. Zeekr will not only take over the 30 per cent share of the Swedish company but also shares from Geely. In the end, Zeekr will hold 51 per cent of Lynk & Co and Geely the remaining 49 per cent.

Geely in turn increases its Zeekr shares

At the same time, Geely Auto plans to increase its stake in Zeekr to around 62.8 per cent in order to further promote close cooperation between the Geely Auto, Lynk & Co and Zeekr brands, “improving industrial synergies, hardware and software commonality, supply chain efficiency, after sales service, and accelerating the creation of a stronger global group.”

“This integration is a key measure for Geely Holding to implement its long-term strategic plans. The coordination and integration of our brands supports their sustainable operations and generates greater synergies that benefit sales, services, revenue, and product competitiveness allowing our companies to provide greater value and opportunities to both global consumers and shareholders,” said Geely CEO Li Shufu.

Lynk & Co is the older brand and initially focussed on hybrids and plug-in hybrids – also in Europe. However, the brand was only moderately successful in Europe with the Lynk & Co 01 SUV, which may have been partly due to the sales model. Things have gone better in China so far, but the momentum is weakening.

Lynk & Co is currently working on a new start under a new brand manager and is also bringing a battery-electric SUV to Europe with the 02 (sold as the Z20 in China). Zeekr, on the other hand, has focussed on BEVs since it was founded in 2021 and has been successful with this in China – expansion into other markets, including Europe, is currently underway. The Lynk & Co 02 is technically closely related to the Zeekr X – so there is internal competition.

However, with the expansion of the Lynk & Co model portfolio to include BEVs, the two brands are becoming increasingly close – after all, they also rely on the same Geely vehicle platforms and the production network in the background. In addition, both brands have a comparable design language.

Zeekr reduces losses

In the first three quarters, Zeekr and Lynk & Co together accounted for around 30 per cent of total Geely sales. In October, Lynk & Co’s sales of 31,074 units were still higher than Zeekr’s 25,049 vehicles, but this is likely to change soon. Over the year as a whole, Zeekr was able to increase its sales by 92 per cent, compared to ‘only’ 26 per cent for Lynk & Co.

Zeekr also recently presented its business figures for the third quarter. The brand achieved a turnover of 18.36 billion yuan (2.4 billion euros), of which 14.4 billion yuan came from the vehicle business and 3.25 billion yuan from the sale of batteries and components. Zeekr is also approaching the black: The net loss in Q3 was still 1.14 billion yuan or around 150 million euros – almost 22 per cent less than in Q3 2023 and 37 per cent less than in Q2 2024.

Source: Info via email (Volvo), zgh.com (Geely) cnevpost.com, carnewschina.com, cnevpost.com (quarterly numbers)