In an unprecedented move within the automobile industry, Geely, the parent company of two prominent brands, Zeekr and Lynk & Co, has announced a merger that has stirred both excitement and speculation among industry insidersThis remarkable union, which was finalized on February 14, 2024, marks a significant turning point not only for Geely but also for the broader automotive market as they aim to establish a powerhouse capable of competing on a global scale.

The synergy between Zeekr, which focuses on high-end electric vehicles, and Lynk & Co, known for its range of fuel-powered and hybrid models, fits within Geely’s strategy to streamline its offerings in the increasingly competitive mid-to-high-end marketZeekr emerged in 2021 as a cutting-edge manufacturer specializing in smart electric cars, while Lynk & Co has a longer history, having been founded in 2016 with a product lineup that spans various fuel optionsWith this merger, Zeekr has taken a controlling 51% stake in Lynk & Co, leaving 49% to be held by GeelyNow recognized as the Zeekr Technology Group, the new entity aims to elevate Geely’s status in the automobile sector.

As evidence of this ambition, in the year prior to the merger, Lynk & Co's sales reached an impressive 280,000 vehicles, while Zeekr followed closely with 220,000 units soldThis newly formed group, boasting a sales volume of a staggering 500,000 vehicles and an average price of approximately 250,000 RMB per car, has set an ambitious target of reaching one million vehicles sold annually in just two years, with aspirations to become a key player akin to the “BBA” (a term used to denote top-tier luxury brands such as BMW, Benz, and Audi) in the burgeoning new energy vehicle market in China.

This strategic merger was not only a synergy of assets but also represented a philosophical shift in Geely’s approach to competition in the automobile industrySpeaking to the media following the merger announcement, An Conghui, CEO of both Geely Holding Group and Zeekr Technology Group, emphasized that the aim of this unification is not merely to compete through pricing wars but rather to build a strong brand identity based on technology, product quality, and reliable competitive vitality.

With the establishment of Zeekr Technology Group, Geely has laid out a clear vision as articulated in the Taizhou Declaration issued in September 2024. This declaration called for a relentless push towards the deep integration of internal resources to clarify brand positioning, streamline shareholder relationships to minimize conflicts of interest and redundant investments, and enhance resource utilization efficiency

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Thus, this merger was seen as the starting point for Geely’s ambitious restructuring.

In the months leading up to the merger's completion in February, the announcement of Geely transferring an 11.3% stake in Zeekr was reported, which, upon finalization, would increase Geely’s overall stake to approximately 62.8%. The integrated company, Zeekr Technology Group, not only retains its dual-brand strategy but aims to create a cohesive operational model that seamlessly combines manufacturing and backend systems while ensuring the front-facing functions such as brand operation and sales services remain independent.

To navigate the complexities of supporting two distinct brands, the Zeekr Technology Group has set up a cooperative framework that includes a product committee and a user committee, designed to foster communication and efficiency across both brandsLin Jie, the Vice President of Zeekr Technology Group, highlighted that Lynk & Co will leverage Zeekr’s advanced autonomous driving system, Haihan Zhiji, marking an effective integration of technology sharing that enhances both companies' competitiveness in the intelligent driving sector.

Lynk & Co has recognized Zeekr's prowess in autonomous technology as a valuable asset in their quest to compete with emerging automotive brandsThe rapid development of Zeekr’s Haihan Zhiji system places them at the forefront of intelligent driving technology, with its first-generation system already being deployed in vehicles by the end of 2023. The launch of subsequent versions demonstrates Zeekr's commitment to staying ahead of technological advancements and ensuring both brands can provide high-end driving experiences.

However, the merger also necessitated a re-evaluation of their respective market positions, as both brands historically targeted overlapping customer segmentsAs the Zeekr Technology Group embarks on future growth, it aims to delineate clear goals for Zeekr and Lynk & Co, focusing on unique niches within the automobile market

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Zeekr's trajectory involves launching large hybrid SUVs in late 2024, while Lynk & Co will concentrate on expanding its offerings in electric, hybrid, and fuel markets, particularly targeting price points between 200,000 and 300,000 RMB.

With regard to electric vehicles specifically, Lynk & Co will focus on the EM-P intelligent range for now, distinguishing itself from Zeekr’s upcoming premium electric hybrid systemsThis strategic positioning allows each brand to cater to different segments of the evolving market while capitalizing on their unique technological advancementsIn the realm of intelligent cabins, Lynk & Co’s FlymeAuto system will continue to enhance its reputation as a consumer favorite.

Moreover, the enduring nature of fuel-powered vehicles within the group's long-term strategy cannot be overlookedLin Jie affirmed the profitability of this segment, with Lynk & Co poised to maintain its lineup of fuel-powered vehicles to adapt to market demands while feeding technological innovations back into the segment.

On an international front, the ambitious Zeekr Technology Group plans to capitalize on emerging markets, with strategies for localized production and distributionAn Conghui pointed out that while electric vehicles may dominate future markets, in many regions, fuel-powered vehicles still command significant shares of the marketThus, the group’s strategy will involve a balanced approach that addresses both domestic and international sales effectively, engaging with local market conditions and preferences.

With an eye on the future, the Zeekr Technology Group is set to unveil five new models within the first year following the merger, aiming to establish over 200 stores internationallyThe sales goal for 2025 stands at a robust 710,000 units, with a vision to scale this number to one million by 2026. This ambitious outlook positions the Zeekr Technology Group as a cornerstone in the next wave of automotive innovation and competitive excellence.

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