Chinese EV maker Zeekr hastens US IPO: unit of Geely Auto seeks to expand product line to battle Tesla, domestic rivals

The company has made public its listing documents for an IPO on the New York Stock Exchange
Zeekr would be the first major IPO by a Chinese firm in the US since Beijing tightened its approval procedure in 2021

Electric & new energy vehicles

Daniel Renin Shanghai

Published: 5:30pm, 10 Nov 2023

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Zeekr Intelligent Technology Holding, an electric vehicle (EV) unit of Geely Auto, is revving up for an initial public offering (IPO) in the US after it made public listing documents that it filed with regulators.

The company, which builds premium electric cars that take on Tesla’s Model 3 and Model Y in mainland China, said it would use the IPO proceeds to expand its product line as it competes for buyers in a hot market segment.

Zeekr confidentially filed for an IPO on the New York Stock Exchange (NYSE) in December 2022, targeting proceeds of US$1 billion, according to two sources with knowledge of the carmaker’s plans.

A listing now would be the first major IPO by a Chinese firm in the US since Beijing tightened its approval procedure for companies seeking to raise funds abroad in 2021.

Robotic arms build Zeekr electric minivans at a factory in Ningbo, Zhejiang Province, on February 22, 2023. Photo: Bloomberg

“Fresh capital is needed by an EV start-up to strengthen its development capability and survive cutthroat competition,” said Ding Haifeng, a consultant at Shanghai financial advisory firm Integrity. “Zeekr has the potential to challenge Tesla and domestic rivals such as Nio and Xpeng after going public.”

Zeekr is unlikely to raise as much as it hoped for last year given current market sentiment. Its shares could start trading on the NYSE within weeks, Reuters reported, citing unidentified sources.

In its IPO document, Zeekr said its net loss in the first half of 2023 widened 25 per cent from a year earlier to 3.87 billion yuan (US$520.6 million). Revenue more than doubled to 21.3 billion yuan. It began exports to Europe earlier this year.

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The company was valued at US$13 billion in the latest round of financing with investment from Amnon Shashua, founder of autonomous driving technology company Mobileye Global, and Yuexiu Industrial Fund, an investment arm of the Guangzhou municipal government. The fundraising ended in February.

Nio, Xpeng and Li Auto are the top three Chinese EV start-ups. All three are listed in both New York and Hong Kong, and their vehicles feature autonomous driving technology, digital cockpits and high-performance batteries.

Zeekr Intelligent is a subsidiary of Hong Kong-listed Geely Auto. The group founder Li Shufu personally owns 22.93% of the carmaker, according to Geely’s latest annual report.

Li’s Zhejiang Geely group – which also owns Volvo Cars and Lotus, has a stake in Aston Martin, and makes EVs in a joint venture with Baidu – set up Zeekr in 2021 to make premium vehicles in tandem with an accelerated pace of electrification on mainland China’s roads.

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At present, Zeekr offers four models for mainland consumers, with sales of 92,105 units during the first 10 months of this year, up 86 per cent from the same period in 2022. The company aims to nearly double total deliveries to 140,000 units this year from last year’s 71,941.

“Our efforts are backed by our strong in-house research and development capabilities, deep understanding of products, high operational flexibility, and flat, efficient organisation structure,” the company said in a document published on Thursday. “Together, these features enable fast product development, launch and iteration, and a series of customer-oriented products and go-to-market strategies.”

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