Geely privatizes Zeekr and returns to the year of strategic contraction in 2014.

When hearing the news that ZEEKR might delist, the first reaction of most ZEEKR employees was "very sudden".

Although many people had anticipated a major adjustment in Geely Group since the day ZEEKR merged with Lynk & Co, at first, both within Geely Group and in the industry, it was thought that even if Geely carried out integration, it would at least keep ZEEKR as its own territory. However, the facts have proven that they obviously underestimated Geely's determination and strength in this integration.

On May 7th, Geely Group submitted a non - binding offer letter to ZEEKR, proposing to privatize ZEEKR and acquire all issued and outstanding ZEEKR shares and American depositary shares (except those beneficially owned by the Group). That is to say, less than a year after its listing on the US stock market, ZEEKR is facing the possibility of delisting.

Shortly after Geely submitted the non - binding offer letter, ZEEKR held a communication meeting about delisting. A person attending the meeting told 36Kr Auto that ZEEKR conveyed two main reasons for delisting: on the one hand, to deal with external uncertain risk factors; on the other hand, it is more conducive to internal strategic focus, synergy, and resource integration.

At the end of last year, Geely Group promoted the merger of Lynk & Co and ZEEKR to strengthen the ZEEKR Group. Now, Geely Group plans to integrate the ZEEKR Group into Geely. This sudden strategic shift means a more severe strategic judgment from Geely Group.

36Kr Auto learned that during the Spring Festival, Geely Group held a high - level strategic meeting. At the meeting, Geely's senior management was quite pessimistic about the next three years, so they are making a strategic contraction just like in 2014.

Just 10 years ago, Geely also went through a large - scale integration.

At that time, Geely, which had multiple sub - brands such as King Kong, Panda, and Sea View, was in an awkward situation of "fighting against itself". So in that year, it cancelled the three major brands of Global Hawk, Emgrand, and Englon, formed a brand structure of "One Geely", and launched five product series:

The Panda series targeted the micro - car market; the King Kong series targeted the small - car market; the Vision series targeted the low - end compact car market; the Emgrand series focused on the compact car market; and the KC series targeted the mid - size car market.

After that round of integration, Geely entered an era of great growth for several years and became the sales champion among independent brands in 2017. Now, there is another profound transformation, behind which is Geely's ambition to break through the sales volume of 4.11 million vehicles and even reach a sales scale of 5 million vehicles in 2027.

The Advantages and Disadvantages of ZEEKR's Delisting: No Longer Considering Listing on the Hong Kong Stock Exchange

According to the announcement released by Geely Group, as of now, Geely Group holds approximately 65.7% of ZEEKR's shares.

After ZEEKR's delisting and integration are completed, Geely Group's plan for its several brands is as follows: ZEEKR is positioned as a global luxury technology brand; Lynk & Co is positioned as a global high - end new energy brand; Geely Galaxy and Geely Star are positioned as global mainstream brands. Based on this, a synergistic effect among different brands will be created.

Regarding the Group's such plan, many Geely insiders believe that although listing has certain financing and refinancing effects, ZEEKR's current performance has not met the expectations before its IPO. The layout in fields such as intelligence and batteries also needs a larger scale for verification. Even if it stays on the US stock market, it may not bring much value to shareholders and employees with shares.

Delisting can instead make the integration more thorough. ZEEKR's technical assets can also be incorporated into Geely Group for unified deployment. Otherwise, the technical assets of a listed company must retain a certain degree of independence and cannot be easily used.

Judging from the data, ZEEKR's market performance has indeed been disappointing since its listing.

In 2024, the ZEEKR brand delivered a total of 222,100 new vehicles, failing to reach the original delivery target of 230,000 vehicles. This year, Geely Group has set a sales target of 710,000 vehicles for the ZEEKR Group, including 390,000 vehicles for the Lynk & Co brand and 320,000 vehicles for the ZEEKR brand. However, judging from the sales situation in the first four months of this year, the ZEEKR Group may still fail to achieve the sales target this year.

From January to April this year, the ZEEKR brand sold 53,000 vehicles, with an annual target achievement rate of 16.56% and an average monthly sales volume of less than 15,000 vehicles. To achieve the target, in the next eight months, the ZEEKR brand must sell an average of more than 33,000 vehicles per month. It is obvious that the pressure is huge.

On the other hand, the Lynk & Co brand sold nearly 100,000 vehicles from January to April this year, with an annual target achievement rate of 25.64% and an average monthly sales volume of nearly 25,000 vehicles. To sell 390,000 vehicles in 2025, Lynk & Co needs to achieve an average monthly sales volume of about 36,000 vehicles in the next eight months. Even if the Lynk & Co brand can achieve its sales target, it seems difficult to fully offset the sales gap of the ZEEKR brand.

The performance at the sales end will inevitably affect ZEEKR's performance in the capital market. Since its listing nearly a year ago, ZEEKR's stock price has once dropped to $13 per share, quite close to the level of a "penny stock".

For this reason, delisting can instead give ZEEKR more room to adjust its business operations. Being integrated into Geely Group and further collaborating with other brands in terms of procurement, technology, etc., is also expected to further narrow ZEEKR's losses.

However, it is currently difficult to say to what extent the integration can relieve the sales pressure of the two groups. The background of the integration in 2014 was that independent brands failed to break into the high - end market. At the same time, in the mid - and low - end markets, they were impacted by the price cuts of joint - venture brands. As a result, against the background of the growth of the overall automotive industry, the market share of a number of independent brands, including Geely, decreased instead of increasing.

Now, what Geely needs to think about is how to compete with a number of independent brands for the existing market and how to sail overseas while bypassing trade barriers. The competitive environment has changed. Can the integration still achieve the same effect as before?

It is worth mentioning that even if the performance of the ZEEKR Group can be boosted in the future, insiders of ZEEKR told 36Kr Auto that ZEEKR is unlikely to list on the Hong Kong Stock Exchange.

In this integration, currently, the core employees holding ZEEKR's original shares are most likely to be directly affected. However, ZEEKR has reassured them in a timely manner. It is understood that ZEEKR has announced to employees that employees holding original shares will not be affected by the delisting. The company will redeem the shares in employees' hands at $25.66 per share. This figure is not only higher than the issue price but also higher than the average trading price of ZEEKR's shares recently.

For more ordinary employees who do not hold original shares, the biggest impact brought by the merger of the two groups is the possible personnel adjustment.

A ZEEKR assisted - driving engineer told 36Kr Auto: "Previously, the assisted - driving team had given a lay - off quota. However, many people left voluntarily before the lay - off after hearing the news, probably related to the team's working intensity from 9:30 am to 11/12 pm. There will definitely be another personnel adjustment after the integration of ZEEKR and Geely Group."

The situation of ZEEKR's intelligent cockpit team is similar. A member of the cockpit team said: "For several months, the pressure of lay - off has been hanging over the team members. Moreover, the company obviously emphasizes the efficiency - to - person ratio more. The team will count working hours every quarter. Those with the lowest working hours each quarter will be talked to, and performance payments and lay - offs will also refer to the working hours." In his opinion, the strategic contraction of the entire group can be seen from these details, and the group will definitely continue to integrate in the future.

The Integration Will Not Stop Here

As ZEEKR employees think, after ZEEKR is merged into Geely Group, Geely's integration will continue.

In November last year, Lynk & Co and ZEEKR were integrated. The integration of these two core brands set an example for Geely Group's subsequent integration;

In March this year, Galaxy was upgraded from a product series to a brand, and the Yijia brand was integrated into it;

Also in March this year, Geely held an AI intelligent technology press conference, released the Qianli Haohan intelligent driving solution, and announced Geely Group's strategy of "one - game - plan" for high - level intelligent driving. Chen Qi, the former top person in ZEEKR's intelligent driving team, became Geely Group's chief intelligent driving scientist. In a certain sense, this represents the preliminary integration of Geely Group's assisted - driving team;

In April this year, Geely Group released another announcement, integrating ZEEKR's intelligent cockpit team into Geely Research Institute. Jiang Jun, the former vice - president of ZEEKR in charge of intelligent cockpit business, was appointed as Geely Group's chief cockpit scientist.

The integration of the assisted - driving and intelligent cockpit teams means that ZEEKR's technical assets in the field of intelligence have been transferred to Geely Group. Naturally, the current privatization of ZEEKR is also a matter of course.

However, Geely Group's integration will continue.

If Geely continues to firmly implement the principle of "One Geely", then whether listed companies under Geely, such as Lotus and Polestar, will also face the possibility of delisting has also sparked discussions within Geely. Of course, there are also voices within Geely believing that the business volumes of these listed companies are relatively small and they have already completed their integration, so they may not necessarily go private.

What 36Kr Auto has learned so far is that the energy teams of ZEEKR, Lotus, and Geely have all been integrated into the Haohan Energy Company.

In addition, 36Kr Auto has also learned from internal sources that Lotus and Polestar have recently undergone a series of personnel adjustments. Since last year, Lotus has been downsizing, laying off about 10% of its staff, and has continued to lay off employees this year. The management has also been changing frequently. Not only was the position of President of Lotus China taken over by Qin Peiji, the former chief operating officer of Polestar, but many directors of Lotus have also been replaced by former Polestar managers. The integration of the management of these two brands can be regarded as a prelude to the integration.

As for whether Geely can achieve the sales target of 4.11 million vehicles this year and break through the sales scale of 5 million vehicles in 2027 after this vigorous integration, time will tell us the answer.