Geely Is On Track For Substantial NEV Sales In 2024 (GELYF)

Introduction

Per my October article, Geely Automobile (OTCPK:GELYY) (OTCPK:GELYF) is a major battery electric vehicle (“BEV”) producer, despite being overlooked frequently. Headlines in the US have talked about slowing EV sales in recent months, but Geely Automobile is a global company showing no signs of slowing down. New energy vehicles (“NEVs”) consist of BEVs and plug-in hybrids (“PHEVs”). My thesis is that Geely Automobile will sell a substantial number of NEVs in 2024.

At the time of this writing, $100 is equivalent to about RMB 714 so we divide RMB numbers by about 7.14 to get the USD approximation.

Numbers Through November

Geely is putting up impressive numbers with respect to BEVs and PHEVs, and I expect these units to be even stronger in 2024:

Zeekr 007 BEV Model

Zeekr sold 13,104 BEV units in November, and they are an integral part of Geely’s BEV strategy. Most of the Zeekr sales in recent months have been the 001 model, but that could be changing soon. Per CnEVPost, the 007 sedan model will be delivered starting on January 1 and there are already 51,569 pre-orders. I believe the 007 is one of the reasons why Geely will have robust NEV sales in 2024. The 007 can charge to 500 km in just 15 minutes, making it an attractive option for long road trips! Per the CnEVPost article, its starting price is about RMB 210,000 which is a little under $30 thousand. It has an 800 V electrical system, and it is Zeekr’s first model to carry the LFP golden battery, although the high-price option has the CATL qilin battery. Per ​​Electrek, the 007 is Zeekr’s first model to adopt an integrated mega-casting rear-end aluminum body.

PHEVs

Per an October Gasgoo article, Geely made 50,000 Galaxy L7 PHEVs through October 15 which is remarkable seeing as the model didn’t go on sale until May 31. 2024 will be the first full year for PHEV models like this one, and I expect the unit sales to be robust.

Global Markets

Dunne Insights CEO Michael Dunne says BYD (OTCPK:BYDDY), SAIC-GM (GM), and Geely are coming to Canada through the dealer network. Geely has had strong NEV sales in China for a long time, but I believe one of the ways they will increase NEV sales in 2024 will be through other markets. There is room for more NEV sales in the US and Europe as buyers begin embracing NEVs as they have already done in China. Per a December WSJ article, EV sales are over 26% of new vehicle sales in China while they are closer to 8% in the US:

Headlines in the US have been focusing on slowing demand for electric cars for the last few months, but the long-term trends tell a different story. Per a December BloombergNEF report, global ICE sales have been declining since 2017 while NEV sales are rising:

We often hear about electric efforts by many companies like VW Group (OTCPK:VWAGY), but Geely is among the highest with respect to EV sales as a percentage of overall sales:

Closing Thoughts

The stock is down since the time of my October article, but my valuation thoughts aren’t drastically different.

Forward-looking investors need to keep an eye on the raw unit sales of the Zeekr 007 model. Also, investors need to keep tabs on the model 001 sales to see how much the 007 is additive as opposed to cannibalistic.

Disclaimer: Any material in this article should not be relied on as a formal investment recommendation. Never buy a stock without doing your own thorough research.

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