GEELY AUTO has set its sights on becoming the top-selling passenger vehicle brand in China this year. During the company's 2025 annual results presentation on March 18, Gui Shengyue, CEO and Executive Director of Geely Automobile Holdings Ltd., stated that the goal for 2026 is to achieve the number one position in domestic sales.
From a full-category perspective, BYD held the top spot last year with approximately 3.55 million domestic vehicles sold in 2025. GEELY AUTO sold 3.025 million units, a gap of 530,000 vehicles. Competitors like Changan and Chery are also accelerating. The top four Chinese auto brands have all surpassed the 3 million vehicle threshold, while multiple institutions predict overall market growth will slow to low single digits in 2026.
Gui's confidence stems from a recent trend: GEELY AUTO has led China's passenger vehicle sales for the first two consecutive months of 2026. The past few years of market growth were driven by rising new energy vehicle (NEV) penetration expanding the total market. In 2026, this dynamic is fading. The China Passenger Car Association forecasts flat growth compared to 2025, while the China Association of Automobile Manufacturers predicts just 1% growth. As growth红利 diminishes, the competition is shifting from the first half focused on transition speed to the second half focused on systemic efficiency.
GEELY AUTO's ambition is fueled by a doubling of its NEV sales in 2025. Annual NEV sales reached 1.688 million units, a 90% year-on-year increase, raising the NEV share of total sales from 37% to 56%. This positions GEELY AUTO as the second-largest globally in NEV sales, behind BYD. Just two years ago, the figure was less than 500,000 units. The Geely Galaxy series was the main contributor, with sales of 1.236 million units, up 150% year-on-year, reaching one million annual sales within 29 months. The Geely Xingyuan became the best-selling model across all passenger vehicle categories, and the Galaxy M9 entered the top three for mid-to-large SUVs shortly after its September launch.
This rapid growth indicates that the structure of the mainstream NEV market (priced between 100,000 and 200,000 RMB) is not yet fixed. Nearly 7 million NEVs were sold in this segment in 2025, a 24% increase, making it the fastest-growing part of the market. Galaxy's surge from 490,000 units a year ago to 1.24 million units shows that consumer brand loyalty is not locked in; market share goes to those with faster product cycles and better value.
The ZEEKR brand pursued a different path. It sold 224,000 units for the full year. While the volume is smaller, sales exceeded 80,000 units in the fourth quarter following the launch of the ZEEKR 9X. Gan Jiayue, CEO of Geely Auto Group, revealed to Wall Street News that the delivery cycle for the ZEEKR 9X is expected to shorten from 11 weeks to 8 weeks. The ZEEKR 8X, which started pre-sales on March 16, received over 30,000 orders in less than 48 hours. ZEEKR's value lies not in volume but in profitability. The brand achieved a 23% gross margin in Q4, with the ZEEKR 9X nearing a 40% vehicle gross margin. Dai Yong, CFO of Geely Auto Group, stated that ZEEKR's contribution to total sales increased from 7.5% for the full year to 9.5% in Q4, directly lifting the overall gross margin to 16.9%. For reference, Chery's full-year gross margin was 13.8%, and NIO's was 13.6%.
The Chinese auto market is entering a new phase. After years of price wars, cost-cutting potential is largely exhausted. The next competition will be about offering higher product value at equivalent prices and boosting profitability through premium products. The ZEEKR 9X's near-40% margin is a key card for Geely in this profit battle. Geely has also maintained its strength in internal combustion engine (ICE) vehicles. The China Star brand sold 1.214 million units in 2025, achieving growth against a market decline of 4.6%. Gui Shengyue reiterated a key point: "For a considerable time to come, automotive companies capable of multi-energy coexistence will be the most valuable."
Beyond sales, GEELY AUTO's most significant undertaking in 2025 was a major restructuring. This included the privatization of ZEEKR, announced in May and completed in December within eight months at a cost of approximately 17 billion RMB, and the acquisition of a 50% stake in Lynk & Co for 9.5 billion RMB. The total cost of these two transactions was 26.5 billion RMB—nearly double the annual core profit of 14.4 billion RMB. Total borrowings increased from 7.6 billion RMB to 18.3 billion RMB, and the gearing ratio rose from 8.8% to 19.8%. Gui framed this as a demonstration of organizational capability: "the courage, determination, and efficiency displayed by Geely in responding to changes in such a fiercely competitive industry."
Strong operational cash flow supported these moves. Full-year operating cash flow reached 47.3 billion RMB, and total cash at year-end was 68.2 billion RMB, resulting in net cash of 49.9 billion RMB after deducting borrowings. The rationale for such significant integration during peak competition is the changing nature of the market contest. The industry theme for the past three years was "NEV replacement of ICE," competing on transition speed, product variety, and volume. The emerging theme is "systemic efficiency"—reusing R&D resources across brands, centralized supply chain bargaining, and shared sales channels. Previously, Geely's brands (Galaxy, Lynk & Co, ZEEKR) operated independently with duplicate R&D, procurement, and sales systems. The integration aims to eliminate this internal friction.
An Conghui, CEO of Geely Holding Group, provided a quantifiable example: procurement synergy between Geely Holding and Volvo generated 5 billion RMB in benefits last year alone. "Without Volvo's help and support, could Geely's safety improvements have been so rapid?" he said, also noting that the ZEEKR 9X's performance benefited from Lotus's chassis tuning. This highlights the fundamental strategic difference between Geely and BYD. BYD's competitiveness stems from vertical integration—in-house development and production of batteries, motors, and chips, achieving unbeatable cost levels. Geely pursues horizontal integration—leveraging a brand and technology ecosystem spanning Europe and Asia through alliances with Volvo, Lotus, Proton, Horse (formerly Aurobay), and the Renault joint venture. Before integration, these assets were cost burdens; their potential to become competitive advantages is beginning to show, with the 5 billion RMB procurement synergy being an initial quantifiable result. However, this is just the start compared to BYD's structural cost advantage.
CFO Dai Yong supplemented this with efficiency metrics: the sales expense ratio decreased to 5.9%, and R&D spending as a percentage of revenue dropped to 6.3%. Total annual R&D investment still grew by 8.3% to 21.9 billion RMB, indicating that revenue grew faster. A notable detail is the increase in the R&D expensing rate (the proportion of R&D costs immediately expensed). It rose from 31% in 2024 to 36% for full-year 2025, and reached 43% in Q4 alone. Dai Yong stated the target for 2026 is to maintain a rate above 40%, aiming for "higher quality profits." This change explains a potential contradiction noted by investors: while the Q4 gross margin rose to 16.9%, overall profit improvement was not as pronounced. The reason was the sharp increase in the R&D expensing rate, with Q4 R&D expenses hitting 5.9 billion RMB—nearly 50% higher than the roughly 4 billion RMB per quarter in the first three quarters—actively suppressing reported profits. A low expensing rate has been a point of criticism for Chinese automakers, as capitalizing R&D spending boosts short-term profits but creates future amortization pressures. By voluntarily increasing this ratio, Geely chooses to bear current profit pressure for cleaner future financials, signaling confidence in its underlying profitability.
Net profit attributable to shareholders was 16.85 billion RMB, up a mere 0.2% year-on-year—a figure distorted by a 9.35 billion RMB gain from the deconsolidation of Horse in 2024. Excluding this, core net profit was 14.41 billion RMB, representing a 36% year-on-year increase.
During the results presentation, Gui Shengyue spent considerable time discussing the industry. He openly addressed three shortcomings: brand building, overseas scale, and customer service. He then turned criticism towards industry practices: "The Chinese NEV market has developed a blind pursuit of 'speed.' Some marketing language that misleads consumers is astonishing, and some automakers, in their drive to cut costs, are compromising vehicle safety." These strong comments point to a genuine industry inflection point. For the past three years, competition centered on speed and price—launching new models quickly, setting low prices, and creating marketing buzz. This strategy worked in an expanding market with a continuous influx of new customers, where mistakes were less costly. As the market shifts to a replacement cycle, where users buy their second or third NEV, the importance of "slow variables" like safety, quality, and after-sales service will rise rapidly.
Gui listed the completion of the world's largest automotive safety center in 2025 as the top achievement of the year. "Whether it's a luxury car costing hundreds of thousands or millions, or a mass-market product for the people, all will undergo the same rigorous testing standards at Geely." On smart technology, he set a benchmark: "Geely's autonomous driving is expected to reach the level of Tesla's FSD within this year." The day before the results, NVIDIA CEO Jensen Huang demonstrated AI physics applications at the GTC conference using a Geely vehicle.
However, the most apparent shortfall for Geely is exports. This weakness is particularly glaring given the industry trend. China exported 7.1 million vehicles in 2025, a 21% increase. Overseas markets have evolved from a bonus to a core growth engine for leading players—nearly half of Chery's sales come from overseas, and BYD surpassing one million overseas units was a major growth story last year. As the domestic market becomes a red ocean, overseas markets represent one of the few remaining growth opportunities.
CEO Gan Jiayue did not avoid the issue. "In 2026, we will prioritize and dedicate all group resources to international business." Plans include expanding overseas stores to over 1,300 within the year, launching popular Galaxy models globally, and scaling up Lynk & Co sales in Europe through Volvo's channels. Exports for the first two months of 2026 have already exceeded 60,000 units per month, a 129% year-on-year increase. While Geely's publicly stated overseas sales target is 640,000 units, Gui revealed an internal challenge target of 750,000 units for this year. Geely possesses unique assets like Proton, the Renault Brazil JV, and Volvo's European resources—advantages other Chinese brands lack. However, these have not yet fully translated into export scale. 2026 will be a critical test of whether these strategic assets can generate real sales volume.
The annual sales target of 3.45 million units represents only 14% growth. The capital expenditure budget of 16 billion RMB is lower than the 17.9 billion RMB spent in 2025. The expansion pace is moderating, while the focus on efficiency is increasing.
Gui concluded the presentation by stating, "We have established the most comprehensive technology ecosystem among Chinese automakers. From cockpits and autonomous driving to chips, batteries, and future mobility, which company has a layout as complete as Geely's?" Two and a half years ago, he predicted that every subsequent results announcement would feature record sales—a promise fulfilled in 2025. His new pledge is: "It is highly likely that every future earnings release will see core net profit reach a new historical high." The next goal to fulfill is domestic leadership. Whether integration benefits can be realized in time, whether exports can transform from a weakness into a growth engine, and whether Geely's systemic capabilities are robust enough for a market shifting from incremental to存量 competition—the answers will be revealed in 2026.