Geely Records $763M Profit in 2022, Aims to Accelerate EV Sales

On March 21, Chinese automaker Geely released its annual financial report, revealing that the company recorded a revenue of 147.965 billion yuan ($21 billion) in 2022, representing a year-on-year increase of 45.6%. Geely’s net profit for the year was 5.26 billion yuan ($763 million), up 8.5% from the previous year, while the company’s total cash reserve rose by 20.4% to a record high of 33.7 billion yuan ($4.9 billion).

Despite Geely’s impressive financial results, CEO and executive director Gui Shengyue remarked, “Geely’s performance over the past two years has not been so brilliant. The reality is that Geely has lost its championship status in China. In the electric vehicle market, we have been surpassed by outstanding peers.”

In 2022, Geely’s total sales volume reached 1.433 million vehicles, representing an 8% year-on-year increase. The sales volume of electric vehicles in particular saw a significant increase of 300% to 328,700 units. However, rival company BYD sold 1,868,543 vehicles in the same period, with 235,197 of those vehicles sold in December alone.

Geely’s overall gross profit margin experienced a decline of three percentage points to 14.1%, which can be attributed to several factors, including the increased price of raw materials and the increased proportion of electric vehicles in the company’s sales mix.

Gui acknowledged that one of Geely’s previous challenges was the imperfection of its products and its disorganized sales channels for both electric and fuel vehicles.

Regarding brand planning, Gui shared that Geely has differentiated its subsidiary brands in the electric vehicle market. Specifically, Zeekr is focused on luxury electric vehicles, Lynk & Co is focused on high-end electric vehicles, while Geely itself primarily targets the mainstream affordable electric vehicle market.

Geely’s financial report also revealed that its sub-brand Zeekr has quietly submitted an application for listing to the U.S. Securities and Exchange Commission on December 7, 2022. The application is currently under regulatory review, and Zeekr plans to make a public submission at an opportune time and work towards completing the listing process.

According to Zeekr CEO An Conghui, the company’s use of integrated die casting technology in its upcoming model, the Zeekr 009, is expected to significantly reduce costs. An expressed confidence that Zeekr would be able to deliver 140,000 vehicles in 2023, including 70,000 units of the Zeekr 001, 30,000 units of the Zeekr 009, and 40,000 units of the Zeekr X.

In 2022, Geely achieved a 72.4% year-on-year growth in export sales volume, reaching a total of 198,200 vehicles. Of these, 35,600 were shipped by Lynk & Co. As of March 2023, Lynk & Co had opened 11 experience stores in several European countries, including Holland, Sweden, Belgium, Germany, Italy, and Spain.

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Increasing its market share in the electric vehicle market remains Geely’s top priority. Gui acknowledged that companies such as Tesla and BYD had been working in this field for many years and had achieved significant profits last year, reflecting the fundamental law of development in the automotive industry that large scale can generate profits. He expressed confidence that Geely and other similar enterprises would gradually show significant advantages in the industry.

Looking ahead, Geely has set an annual sales target of 1.65 million vehicles for this year, and plans to release ten brand-new models consecutively over the next four quarters.