In the auto market where the price war is intensifying, and most new energy vehicle companies make little or even lose money, Geely Automobile's acceleration of new energy transformation not only did not drag down performance, but achieved a substantial increase beyond expectations, and ushered in a good start in the first quarter of this year.
A few days ago, Geely Automobile Holdings Co., Ltd. announced on the Hong Kong Stock Exchange that its revenue in the first quarter of 2024 was 52.32 billion yuan, a year-on-year increase of 56%; The net profit attributable to the company's equity holders in the first quarter was 1.561 billion yuan, a year-on-year increase of 119%. As of March 31, 2024, Geely Automobile's total cash level reached 39.4 billion yuan.
On the one hand, Geely's rapid transformation of new energy products, many new energy products have replaced fuel products, and on the other hand, Geely has made full use of the advantages of intelligence and electrification to achieve high-quality improvement of brand and profit.
Volume and price rise in exchange for high profits
For the sharp increase in revenue and profit, Geely Automobile said that in the fiercely competitive market environment, Geely Automobile made a strong start in the first quarter, with sales growth of 49%, outperforming the market. "Thanks to the significant increase in sales volume and the continuous optimization of product structure, the Group's revenue, gross profit and net profit attributable to the parent company have increased significantly, and the Group has maintained a good cash flow level."
From January to May 2024, Geely Automobile's total sales volume reached 254226 units under the three major brands of Geely, Lynk & Co, and Zeekr, a year-on-year increase of about 126%.
Among them, Geely Galaxy is positioned in the field of mid-to-high-end new energy, and the Galaxy L7 has completed the delivery of 100,000 units in just one year after its launch, ranking among the first camp in the electric hybrid SUV market. Galaxy's first pure electric sedan, the Galaxy E8, was launched in January, and together with the Galaxy L7 and Galaxy L6, it has been deeply engaged in the market of 100,000 yuan to 200,000 yuan. In the first quarter, Geely Automobile's sales exceeded 380,000 units, and Geely Galaxy achieved positive month-on-month sales growth for three consecutive months from March to May.
The development of Lynk & Co is as stable as ever, at present, Lynk & Co 08 EM-P has become one of the most popular plug-in hybrid SUVs of more than 200,000 yuan, Lynk & Co 07EM-P was also listed in May, Lynk & Co achieved sales of 61,056 units in the first quarter, and sales climbed to 21,778 units in May, of which new energy sales accounted for 57%, a new high, and after the launch of Lynk & Co's first pure electric Z10 in the future, Lynk & Co's sales will also usher in a new breakthrough.
Total deliveries in the first quarter were approximately 33,000 units, up 117% from the same period last year. Revenue for the period amounted to RMB14.7 billion, up 71% from the same period last year. gross profit reached RMB1.8 billion, up 137% year-on-year; Gross margin reached 12.3%, up 3.4 percentage points from 8.9% in the same period in 2023.
After deducting the Lynk & Co brand, the average price of Geely + Zeekr in the first quarter (including similar costs for parts and technical licensing) was 126,200 yuan, a year-on-year increase of 5.83%. ZEEKR achieved revenue of 14.717 billion yuan in 24Q1, a year-on-year increase of +70.73%, of which the revenue of vehicle sales business was 8.174 billion yuan, and the average price of a single vehicle was 247,300 yuan.
Although the impact of new energy has also had an impact on Geely's sales of fuel vehicles, through the current market performance, Geely's main sales models have achieved the replacement of fuel vehicles through rapid new energy layout, and the transformation effect is remarkable.
According to the research report of Soochow Securities, looking forward to the second half of 2024, Geely Galaxy E5/L5, Lynk & Co Z10, and Zeekr's new luxury pure electric SUV/Zeekr mix and other models will be launched one after another, and new cars in the field of high-end intelligent electric vehicles will continue to be launched, becoming a strong driver of sales growth. In addition, considering the continuous capital investment required for the development of Ruilan Auto's battery swap business, Geely's listed company will divest its Ruilan Automobile in February 2024 to accelerate breakthroughs in the fields of "intelligent electric + globalization".
Extreme Krypton has become a real thigh
Although ZEEKR suffered a loss of 443 million yuan in the first quarter of 2024, compared with a loss of 682 million yuan in the same period last year, the loss allocated to non-controlling shareholders' equity was 179 million yuan, compared with a loss of 324 million yuan in the same period last year. But it still can't hide the fact that it has become Geely's "thigh".
The total delivery volume of ZEEKR in the first quarter was about 33,000 vehicles, an increase of 117% over the same period last year. Revenue for the period reached RMB14.7 billion, accounting for almost one-third of Geely's revenue in the first quarter, up 71% year-on-year. Gross profit reached RMB1.8 billion, up 137% year-on-year, and although deliveries were not very high, good prices also brought good revenue, and the first quarter has become the mainstay of Geely Automobile's revenue.
In fact, the reason for ZEEKR's loss is also very simple, in addition to the investment in R&D, there is also investment in channels and energy supplement.
Since the beginning of this year, ZEEKR has accelerated channel development, and as of the end of June, it has opened 429 stores around the world. Among them, 402 are in China. As an important channel strategic layout, ZEEKR, which aggregates full-link one-stop services such as experience, retail, delivery, and after-sales, has opened 75 stores and is expected to expand to 140 within the year.
In the future, ZEEKR will further strengthen the channel layout and channel sinking of markets at all levels, and open up more growth space for product delivery, and it is expected that the number of stores will increase to more than 520 within the year.
In terms of energy replenishment, as of June 30, ZEEKR has built 1,130 charging stations and 6,358 charging piles, including 515 extreme charging stations and 2,731 extreme charging piles that meet the 800V ultra-fast charging standard, and at the same time, ZEEKR New Energy has cooperated with 39 mainstream operators in China to access more than 800,000 high-quality third-party charging piles, covering more than 340 cities across the country. The access rate of high-speed charging piles reaches 88%, covering 9 longitudinal, 16 horizontal and 7 radial highways across the country, ensuring that users can travel without worry across the country.
Good products plus enough channel layout, coupled with the continuous improvement of the energy supplement network, are also in exchange for the recognition of the market.
According to the latest delivery volume announced by ZEEKR Intelligent Technology, it will deliver 20,106 units in June 2024, an increase of 89% year-on-year and 8% month-on-month, hitting a record high. From January to June this year, a total of 87,870 units were delivered, and it is believed that with the continuous improvement of deliveries, ZEEKR will soon usher in the harvest period, and bidding farewell to losses is expected to be achieved this year.
It is expected that with the continuous launch of Geely's new energy products and technologies, Geely Automobile will continue to usher in new breakthroughs in revenue and profitability.