Geely Auto, the Hangzhou-based proprietor of Polestar and Volvo, has too many manufacturers. However these days, one in every of them particularly form of stands out: Zeekr. This morning, Zeekr formally entered the U.S. inventory trade at a value of $21 per share and an estimated valuation of greater than $5 billion. Inside a couple of minutes of formally being open for buying and selling, and with Zeekr EVs parked exterior for all of Decrease Manhattan to see, the inventory touched almost $27, pushing the corporate’s valuation to $7 billion.
It was fairly a present of drive, particularly proper after the present of drive on the Beijing Auto Present—and the tariff crackdown on Chinese language-made EVs that will turn out to be information the exact same day. What a day for Geely, the Zeekr model, China and the battle for electrification on the whole.
Meet Zeekr, possibly the most popular Geely Group model
Many American policymakers the prospect of Chinese language-made vehicles. However China’s Geely Group is already there in some methods, now that it owns Volvo, Lotus and Polestar—and a few of these vehicles are made in China. Now all eyes are on its trendy Zeekr model after as we speak’s public debut in New York.
Granted, this isn’t the primary EV startup—and even the primary Geely-affiliated model—to go public. So we have now to surprise: will this one fizzle out and underperform like the opposite IPOs of late? And what does this imply within the context of a thirsty but unsure EV market?
It’s not clear. Nothing is ever clear till the ultimate shoe drops, and the markets shut.
Since its IPO in 2022, Polestar has achieved nearly nothing however sink, now buying and selling at an abysmal 15 cents per share, as of this writing. I requested Zeekr how this time will probably be totally different, however the automaker’s reps declined to remark.
Nonetheless, we are able to be taught lots if we simply pay slightly little bit of consideration. Let’s examine Zeekr to different less-than-stellar newly public corporations. It would simply be slightly bit safer than the opposite particular goal acquisition firm (SPAC) debuts that gave us the publicly traded Lotus and Polestar manufacturers. It’s additionally in considerably higher straits than VinFast, one other IPO that fizzled out shortly after introduction. (Additionally, it is price noting that almost each firm that went public with a SPAC, automotive or in any other case, has sunk like a rock.)
However one factor is definite: Zeekr is now the EV model to look at, in China and past. It is already increasing into Mexico and Europe, and it might even have its eyes on the U.S. subsequent. TechCrunch is already calling Zeekr “the buzziest EV IPO of the yr.”
Market position-wise, Zeekr occupies a luxurious or premium phase that I’d say is equal to Acura or Audi. Zeekr is (theoretically) downmarket from Polestar, which goals to court docket Porsche consumers with its Scandinavian-style minimalist motif. Polestar is type of a sporty Volvo, whereas Zeekr tends to focus extra on exterior and inside adornment. That’s fascinating since each Polestar and Zeekr’s design work was carried out largely at Geely’s Gothenburg, Sweden studio.
However whereas Polestar is admittedly struggling for gross sales, Zeekr has constantly grown. A part of that success is providing a a lot fuller lineup of electrical sedans, SUVs, wagons and even vans, whereas Polestar is simply now getting round to including two extra crossovers after relying solely on the Polestar 2 sedan for therefore lengthy.
For March 2024, Zeekr is up 117% year-over-year. It additionally has delivered greater than 230,000 vehicles whereas increasing into extra worldwide markets. Final yr Zeekr delivered 118,685 vehicles, whereas Polestar solely moved 54,600. Which means Zeekr outsold Polestar at greater than a 2 to 1 ratio, a quantity it mustered upright because the Chinese language EV market is in a race to the underside, price-wise.
In fact, like most EV startups, Zeekr hasn’t but turned a revenue. However Zeekr representatives mentioned the model is on observe to be worthwhile by the top of 2024.
Zeekr is form of an fascinating duck right here, particularly for Individuals. I’ve talked with Zeekr of us on a number of events right here; the model is extra important than a easy high-dollar electrical Audi competitor. It’s accountable for lots of the engineering and software program work that’s now used throughout the Geely Auto manufacturers, together with, sure, Polestar and Volvo. The Polestar 4 makes use of the identical mechanical bits because the Zeekr 001. However simply because Zeekr does plenty of behind-the-scenes work, doesn’t mechanically imply it’ll come to the U.S.
Or does it?
Zeekr’s expertise types the idea for a self-driving Waymo automobile known as the M Imaginative and prescient, and that is already a recognized amount. However, once I’ve requested straight if Zeekr has plans for the U.S. exterior of a industrial car or its tie-up with Waymo, the model has been pretty wishy-washy.
In October, Zeekr reps advised me at a New York occasion that promoting a passenger car within the US was probably on the desk, however then adopted up by way of e-mail saying it had no plans to promote passenger autos within the U.S.
I requested once more per week earlier than the IPO. “[The U.S.] is a market that [Zeekr is] taking a look at however not but committing to for passenger car gross sales,” a Geely rep advised me. “Zeekr and Waymo are working collectively on the following era of driverless autos; Zeekr will probably be offering the car {hardware}, Waymo the driverless tech and expertise.”
Nonetheless, the U.S.’s angle towards imported Chinese language EVs has quickly deteriorated inside only a week of getting that assertion. Zeekr’s autos from China might face a brand new 100% tariff on its autos, which isn’t nice for the model’s outlook as a possible U.S. passenger automobile providing—or the worth of its inventory.
As my colleague Tim Levin mentioned as we speak, we’re coming into a type of automotive chilly warfare right here. Will Zeekr’s vehicles find yourself on sale within the U.S.? Proper now, that feels extra murky than ever.
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