#ZhejiangGeelyHoldingGroup

Volvo Cars has confirmed months of speculation by announcing that it’s planning to go public on NASDAQ Stockholm. On Monday, the automaker stated that it would be seeking to raise 25 billion Swedish kronor (nearly $2.9 billion USD) via the selling of new shares as a way to fast-track its electrification plans. Those include ensuring half its annual volume being represented by EVs and transitioning the majority of its sales stemming from online orders by 2025.

While the targeted IPO valuation is unknown, prior information coming from Zhejiang Geely Holding Group (Volvo’s Chinese parent company) suggested it was aiming for something in the neighborhood of $20 billion. We’ve also learned that the collaboratively owned Polestar would also be going public, except it will be using the always sketchy special-purpose-acquisition-company merger to help pump the stock.

Geely Auto Group has announced the formation of an electric technology firm and automotive brand called Zeekr Company Limited. With the Chinese group already holding numerous mobility-focused brands with a penchant for electrification, it’s a bit curious to see it launching another one. But Geely has indicated that Zeekr will be aimed at the premium EV market using a similar business model as Lynk & Co.

That likely means selling vehicles as a service, rather than a product owned by the driver — something we’ve been incredibly wary of since the industry starting mulling over things like subscription services and online sales. Owned jointly owned by Geely Automobile Holdings and Zhejiang Geely Holding Group, the plan is to start launching products in China before the end of 2021. It’s quite the swift turnaround, leading us to believe there will be some platform sharing with other Geely-owned automotive brands. New product is said to be introduced every twelve months over the next five years.

Volvo Cars’ chief executive, Håkan Samuelsson, believes a ban on gasoline-driven vehicles would be a more effective way to force groups to go electric than continuing to offer subsidies on battery-powered automobiles. The announcement comes as part of the Financial Times’ “Future of the Car Summit,” where Samuelsson will proclaim the internal combustion engine “a technology of the past.”

In related news, Volvo Cars is also in negotiations to merge with China’s Geely Automotive and has renewed its commitment toward becoming an electric-only brand by 2030. The latter issue will also be brought up during Wednesday’s Car Summit, with the CEO praising the United Kingdom’s promise to eliminate the sale of new gasoline and diesel cars that same year.

What miraculously convenient timing.

China’s Geely Automobile Holdings reported a first-half net profit drop of 43 percent on Monday, a tumble that forced it to reduce end-of-year targets. As you may have expected, the coronavirus was named as the biggest obstacle it had to overcome, especially in its home country. That left Geely (parent to Volvo, Lotus, Proton, Lynk & Co, Emerald Automotive, London EV and more) revising 2020 volume estimates by 6 percent to 1.32 million vehicles against the 1.36 million deliveries it enjoyed through 2019.

While enduring a bad financial year in 2020 is hardly breaking news for any major automotive manufacturer, Geely is one of many Chinese firms with global aspirations. Its role as Daimler’s second-largest stakeholder and ownership of Volvo Cars (with which it is planning a full merger) arguably makes it the corporation that’s closest to achieving that goal, too. Yet the current economic and geopolitical situation served to undermine its ultimate goal of becoming Asia’s answer to Volkswagen Group.

China’s Zhejiang Geely Holding Group has its fingers in a lot of pies. Having purchased Volvo Cars from Ford a decade ago for $1.8 billion (a fraction of the price the Blue Oval paid), the brand has focused on scooping up troubled brands with global appeal or creating its own. In 2017, Geely purchased majority stakes in Malaysia-based Proton and UK-based Lotus Cars while attempting to turn its own Lynk & Co into a global brand.

Those are supplemental to its cadre of Asia-focused subsidiaries but no less important to its broader aspirations.

Geely has been exceptionally clear that its ultimate goal is to increase its presence around the world while improving its production capabilities. Its latest strategy involves utilizing new platforms developed for Volvo (which was already sharing architecture with Lynk) for vehicles manufactured in Asia under the Proton banner.

Lynk & Co, the Geely-owned sister brand to Volvo, is rounding out its product lineup with the announcement of a new sport utility vehicle. For clarification, it’s not really an SUV, as Lynk only builds car-based crossovers — and it’s also not entirely new, because it appears to be a squished-down version of the existing 01, itself based on the Volvo XC40. But this recipe may still have produced something novel for the fledgling automaker.

Based on claims from the manufacturer, what we have here is a shortened, lowered, and girthed-up sporting version of its existing crossover. Called the “02,” it’s an even more wagon-like CUV (that stops short of being a full-blown car). This makes sense, as the brand is already planning an “03” sedan. Spy shots of the sedan prototype reveals it more or less resembles an 01 “SUV” with a lowered ride height and different roof.

In fact, all of these vehicles look so similar that it almost feels like Lynk & Co is trying to pull a fast one on us. However, a critical eye reveals subtle styling cues that differentiate the models, even if it’s only slightly.

Fresh-faced automotive brand Lynk & CO began selling its first vehicle in China about two months ago. But it has bigger aspirations than procuring a place in Asia’s largest market — it wants to achieve global domination through westerly expansion and is now preparing to take its first steps.

While the goal seems unrealistic for a fledgeling automaker producing only one model, the brand has friends in high places. Volvo Cars, which is also owned by Geely Automotive, may be tapped to assist Lynk in Europe by offering its factory in Belgium and opening up its servicing infrastructure. If so, that would set a precedent for a Volvo-based support network that could eventually extend to North America.

Volvo Cars is rolling out a subscription service that allows access to vehicles for a monthly fee. It’s a growing trend among luxury brands. Book by Cadillac is the first service to spring to mind but brands like Porsche and Ford have introduced regional pilot programs offering roughly the same thing. Volvo’s subscription service is not a trial run, however. It’s the full enchilada.

For $600 a month, Care by Volvo is offering access to its new XC40 — the new compact SUV that just started production in Belgium this month. Here’s how it works: Volvo customers choose a car online and make a monthly payment that covers insurance, service, and maintenance. The subscription last 24 months but, during that time, customers will be given the opportunity to change cars and sign up for a new 24-month subscription as early as a year into the existing agreement.

It’s an interesting alternative to leasing and a lot of outlets have praised the service for being so affordable, especially compared to Cadillac’s monthly subscription fee of $1,500. But the services aren’t directly comparable. Fist of all, General Motors allows customers to swap vehicles month to month. Secondly, those models are valeted to you and could have an MSRP in excess of $86,000.

Unlike the majority of Chinese automakers looking to the West, Lynk & Co seemed well-poised to bring a physical product to America — even though it had a share-based business model and a distribution plan that seemed counterintuitive. However, Zhejiang Geely Holding Group has announced that it is delaying Lynk & Co’s product launch for Europe and the United States.

The reasoning behind the stall revolves around that unconventional distribution model, which initially involves online ordering and at-home deliveries. Zhejiang Geely now feels that Lynk needs more time to cultivate a company-owned dealership network.