Geely Consolidates Premium EV Brands Zeekr and Lynk & Co

SAUDI ARABIA : In a move to enhance efficiency and global competitiveness, Geely merges its premium electric vehicle brands, Zeekr and Lynk & Co, under the newly formed Zeekr Technology Group.

• The merger aims to cut R&D expenses by up to 20% and supply chain costs by 5-8%.
• Zeekr Technology Group plans to establish over 200 overseas stores by 2025, focusing on Europe, the Middle East, and East Asia.
• Post-merger, Zeekr will focus on luxury electric vehicles, while Lynk & Co will target the mid-to-high-end market segment.

In a significant restructuring effort, China's Geely Holding Group has announced the consolidation of its premium electric vehicle (EV) brands, Zeekr and Lynk & Co, into the newly established Zeekr Technology Group. This strategic move aims to streamline operations, reduce costs, and bolster the company's position in the rapidly evolving global EV market.

Strategic Consolidation for Enhanced Efficiency

The merger involves Zeekr acquiring a 51% controlling stake in Lynk & Co, with Geely retaining the remaining 49%. This integration is designed to create operational synergies, leading to a projected reduction in research and development expenses by 10% to 20%, and a decrease in supply chain costs by 5% to 8%. 

Additionally, organizational costs are expected to drop by 10% to 20%, while capacity utilization rates could improve by 3% to 5%.

Operational Synergies and Cost Reduction

The consolidation is poised to enhance innovation and efficiency across the brands' entire business operations and supply chains. By leveraging shared technologies and components, the merged entity aims to achieve significant economies of scale. This approach is expected to not only reduce unit costs but also boost market competitiveness in the increasingly crowded EV landscape.

Global Expansion Plans

Zeekr Technology Group has outlined ambitious plans to expand its global footprint. The company aims to establish over 200 overseas stores by 2025, focusing on key markets in Europe, the Middle East, and East Asia. 

This expansion strategy includes the creation of a unified sales company to streamline international operations and enhance brand presence. Furthermore, Zeekr is set to debut a new model equipped with Level 3 autonomous driving technology at the Shanghai Auto Show in April, with mass production expected by the end of the year.

Maintaining Distinct Brand Identities

Despite the consolidation, both brands will maintain their distinct identities and market positions. Zeekr will continue to operate as a global luxury technology brand, focusing on premium mid-to-large-sized electric and hybrid vehicles. 

In contrast, Lynk & Co will target the mid-to-high-end market segment, prioritizing hybrid models and focusing on compact and mid-sized electric vehicles, as well as customized offerings. This strategic differentiation aims to prevent internal competition and cater to diverse consumer preferences.

Geely's Ambitious Growth Targets

This merger aligns with Geely Holding Group's broader strategic objectives. The company has set an ambitious target to sell over 5 million vehicles annually by 2027, reflecting a 79% increase from its 2023 sales figures. 

To achieve this goal, Geely plans to consolidate its diverse passenger car brands into two main units: Geely Auto for the mass market and Zeekr Technology for the premium segment. This restructuring is expected to enhance the synergy of key technology research and development across architecture, smart driving, cockpits, and batteries, positioning the company for sustained growth in the competitive automotive industry.