Geely Automobile Holdings on Tuesday (23 March) announced a joint venture with its parent group for electric vehicles (EV) and a new brand called Zeekr but its shares fell over 6% on news its 2020 profit dropped by a third, a media report said.
Geely Automobile sold 1.32m cars last year, down from 1.36m in 2019, as auto sales in the world’s biggest market was hit by the COVID-19 pandemic, Reuters noted.
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Overall auto sales in China fell 1.9% to 25.3m vehicles in 2020, according to industry data.
Geely Automobile also said on Tuesday it and its parent group will form a joint venture for electric vehicles (EV) and launch a new brand called Zeekr, and its profit fell 32% last year.
In a stock exchange filing cited by Reuters, Geely Automobile said the venture would work on research and development, purchase and sale of smart electric vehicles under the Zeekr brand.
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By GlobalDataGeely Automobile and parent Zhejiang Geely Holding Group will jointly invest CNY2bn in the new venture. Geely Automobile will own 51% of the new company, it said.
Hangzhou-based Geely Automobile, highest-profile Chinese automaker in the world due to the parent group investments in Volvo Cars and Daimler, posted 2020 profit of CNY5.53bn (US$850m), versus CNY8.19bn in 2019.
One analyst expected Geely to post a profit of CNY4.02bn, according to Refinitiv data. Revenue fell 5% from the previous year to CNY92.11bn.
It expects to sell 1.53m cars this year, Reuters said.
