Every April, the world’s leading auto executives and engineers fly to China’s biggest auto show to take stock of BYD, the electric car powerhouse that surpassed Tesla’s global sales last year.
But at the Auto China event now taking place in Beijing, another name is getting attention: Zhejiang Geely Holding Group. In an unexpected development, Geely beat BYD in sales in the first two months of the year and is rapidly expanding its range. Geely is now pushing overseas, more than doubling exports to Europe, the Middle East and elsewhere in the past year and taking on global rivals on their home turf.
Geely stands up at a crucial time. The war in Iran has sent gasoline prices soaring, reviving consumer demand for electric vehicles — a segment dominated by Chinese automakers. After years of laying the groundwork to expand exports and escape a cutthroat domestic market, Chinese brands appear poised to take advantage and shift the balance of power in the global auto industry.
Geely has built a business model designed to handle volatility. It is one of the few automakers that can compete across all four major powertrains: gasoline, gasoline-electric hybrids, plug-in hybrids, and fully electric. That width makes it possible to switch quickly as conditions change.
When the Chinese government let government tax subsidies for electric cars expire this year and demand fell, Geely responded by leaning on its gasoline models. Then, as the war in Iran sent gas prices soaring last month, Geely resumed pushing plug-in hybrids and electric cars.
With China’s economy also slowing, sales of battery electric and plug-in hybrid vehicles in China fell 14 percent in the first 19 days of April compared to the same period last year. But sales of petrol-powered cars plunged almost 40 percent.
Geely’s versatility “has become a clear competitive advantage,” said David Zhang, dean of vehicle technology research at the Jiangxi New Energy Technology Institute.
With prices at the pump rising everywhere, Geely said this month it was converting all its remaining gasoline cars to gas-electric hybrids.
“Every single one of their vehicles will be really fuel efficient — that will be another advantage,” said Yale Zhang, managing director of Automotive Foresight, a Shanghai consultancy.
Zhejiang Geely, privately owned by its founder and chairman Li Shufu, 62, controls a wide network of carmakers. It discloses little financial information, but has set a goal of generating 30 percent of its sales outside of China by 2030.
Shares in Zhejiang Geely’s largest unit, Geely Automobile Holdings, are traded in Hong Kong. It sold three million cars last year, up 39 percent from a year earlier. Revenue rose 25 percent as a price war in China pushed car prices down.
Geely began manufacturing cars in 1998 when it began supplying taxis to Chinese fleets. In less than three decades, Zhejiang Geely has grown into a global automaker whose sales are now approaching those of the 123-year-old Ford Motor Company.
Mr. Li’s path was equally unlikely. As a teenager, he used money set aside for college to buy a camera and start a small business photographing tourists. He then began making components for refrigerators, motorcycles and cars before building entire vehicles in Taizhou, his hometown in the coastal Zhejiang province.
In 2006, Geely sold inexpensive subcompacts to first-time buyers with simple, inexpensive designs that looked strongly utilitarian by Western standards.
That did not deter Mr. Li’s global ambitions. In a 2006 interview, he urged Ford to sell Jaguar or Volvo – two of the American carmaker’s many brands at the time – to Geely. The idea seemed far-fetched, but after Ford ran into difficulties during the global financial crisis, Mr Li borrowed heavily to buy Volvo, a Swedish brand, in 2010. Zhejiang Geely has since revived Volvo.
From early on, Mr. Rely on mastering automotive technology. He expressed admiration in 2006 for German automakers DaimlerChrysler and BMW, then leaders in hybrid car technology, but was determined not to rely on others. Geely would have to build its own technology “from scratch.”
In a full-circle moment, he paid $9 billion in 2018 to acquire a 9.69 percent stake in Daimler, which has repeatedly changed its name and is now known as the Mercedes-Benz Group.
Geely has built up a broad portfolio of national and international brands. It bought the London Taxi Company, which makes London’s iconic cabs, in 2013. It bought a 51 percent stake in British sports car maker Lotus in 2017, along with a 49.9 percent stake in Proton, a Malaysian carmaker. For electric vehicles, it has created brands like Polestar, a subsidiary of Volvo, and Zeekr, a premium, tech-heavy offering with cars priced as high as $132,000.
While moving much of its production to China, Geely maintains design studios and factories in Europe, and it opened a Volvo plant in South Carolina. This has helped Geely bypass trade barriers in Western markets.
Geely still faces two major challenges, said Michael Dunne, a longtime consultant to China’s auto industry. Its portfolio of brands requires high sales to remain profitable. At the same time, state-owned automakers in China are shrinking the industry, waging endless price wars and expanding capacity with the backing of local governments and state-owned banks.
“The profits have disappeared” for car sales in China, Mr. Down. Geely remains profitable as a private company in large part because of its exports. But across China’s auto industry, he added, “the state-owned companies are the ones to bet on” to be the last ones standing.
Geely’s main competitor at home and abroad is BYD, which has grown by saturating the Chinese market with cheap electric and plug-in hybrid cars. Many of its models cost less than $15,000. The price war in China has been particularly tough for subcompact plug-in hybrids, BYD’s core segment. BYD’s profits fell sharply last year.
Along with state-controlled automakers SAIC Motor and Chery, BYD and Geely are leading a wave of Chinese cars into the global market. China exported about a million cars a year from 2012 to 2020. That number rose to 7.1 million last year and is on track to reach 10 million this year, nearly as many cars as the United States produces annually.
With tariffs shutting them out of the U.S. market, Chinese automakers are focusing on Europe, Southeast Asia, Australia, Latin America and Africa.
To compete in these markets, Geely is betting on technology. Consider its recently released Zeekr 8X sports car.
At the push of a button, the shades rise across the windows and moonroof, turning the rear seats into a private cinema with in-seat speakers. When an owner stands in front and gestures, the car can pull out of a tight parking space. The vehicle also includes a number of advanced self-driving features and starts at $47,000.
Geely said Zeekr planned to begin overseas sales of the vehicle in the second half of the year. Like many export models from Chinese automakers, the Zeekr 8X is a plug-in hybrid that pairs a large battery with a backup gasoline engine.
Such vehicles were originally produced to address the “range anxiety” of all-electric vehicles, the fear that drivers would run out of power before finding a charger.
That concern has eased at home as China’s state-owned power grid companies have added more charging infrastructure nationwide. Because plug-in hybrids carry the extra cost of a gasoline engine, demand in China is shifting toward all-electric cars.
Instead, automakers including Geely and BYD are redirecting plug-in hybrids to overseas markets where charging infrastructure is less developed.
Europe has emerged as a premium destination. The European Union imposed steep anti-subsidy tariffs on Chinese electric cars at the end of 2024, but exempted plug-in hybrids, which were still a small segment when the policy was drawn up. Imports have since increased.
Last month in Sweden, Li said geopolitical tensions were reshaping the industry and that the Geely group would rely more on Volvo’s European factories. “Globalization has come to an end while we see the trend of economic regionalization,” he said.
Ruoxin Zhang the contribution of research.
