But where are Volvo, Polestar, Lotus and the whole Geely group going?

But where are Volvo, Polestar, Lotus and the whole Geely group going?

For the past ten years, the Chinese group Geely seems to have coveted almost all European car manufacturers. After first buying Volvo from Ford in the late 2000s, the Middle Kingdom giant took a 10% stake in Mercedes-Benz by regaining control of its Smart brand. Geely has also moved closer to the Renault group and is working directly with the French in its new fuel division. In a few years, Geely also acquired shares in Aston Martin and even acquired the Lotus brand, which aims to bring it into the Porsche area as the previous managers of the English manufacturer had tried to do fifteen years ago.

Since the end of the last decade, Geely has also relied on Polestar, a new brand now reserved for electric cars whose design remains very close to that of Volvo models but with a sportier and even more advanced approach. But also Zeekr, a brand positioned in China on the “premium” market as Nio’s competitors. A brand that Geely intends to position in Europe in the same way as Polestar, Lotus and the Volvo brand now focusing on general electrification.

Is there room for all these closely spaced brands?

Like many global automotive groups, Geely relies heavily on technical synergies between its different brands to increase profitability. Smart #1 and #3 are therefore based on the same technical platform as the Volvo EX30 or Zeekr “internal” design of its platforms, but a small English brand that wants to be a major electric luxury brand is now being developed. its cars in China based on the same features as Polestar and take full advantage of the group’s resources.

The new Emeya, an electric sedan from Lotus designed to take on the Porsche Taycan.

Except that in the end, all these brands aim to sell cars that are close to each other in their size, technology and price. The Zeekr seems to claim a slightly higher position than the Volvo, itself positioned below the Polestar which leaves the advantage to the Lotus in the luxury segment. Knowing that Lotus must rebuild its entire image after a general change of strategy, that Polestar still cannot complete its strategy in Europe and that Zeekr is still for a while completely unknown to customers in the Old Continent, the development of all these products without risk. carnivorous and in the context of demanding competition it seems fragile.

Introduced to the stock market two weeks ago, Lotus Tech has lost more than 40% of its value at the time of writing. Polestar and Volvo also lost a large share of their market capitalization after the IPO and Zeekr is also preparing to go public at the same risk of not convincing investors. Shaun Rein, analyst from China Market Research Group interviewed by reporters from Financial Timesnote that « Geely’s strategy in China as in the rest of the world with its brands does not seem to be convincing and that these brands risk competing with themselves.

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The current situation, which is pushing major target brands such as Geely to review their electrification strategy and rely on longer-than-expected heating models, also represents a potential obstacle to their development. Let’s remember, Lotus is aiming for an annual production of 150,000 cars before the end of the year thanks to the large Electre SUV, the new Emeya competing with the Porsche Taycan and the future small SUV to attack the electric Macan. Polestar also aims to sell several hundred thousand cars worldwide by 2030 and Zeekr, for its part, is keen on dynamic development. Let’s also not forget Volvo, which hopes to maintain its current high sales by focusing everything on electric cars, taking a different approach from Mercedes, BMW and Audi who have decided to slow down a bit on the subject. And Lynk & Co, this brand of hybrid cars that never took hold in the European market unlike MG’s rivals.

Although several new Chinese electric brands such as Aiways or Hiphi find themselves on the verge of bankruptcy and brands such as Nio continue to lose a lot of money with government support, the future of luxury brands in the Geely galaxy has not changed strategy is unclear.