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Geely's premium EV brand Zeekr raises US$500 million from investors, including CATL and Intel

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Zeekr, a premium electric vehicle (EV) brand owned by China's leading carmaker Geely, has secured funding from a clutch of investors including US chip maker Intel to reinforce its development of next-generation cars.

Hong Kong-listed Geely Automobile said in an exchange filing on Friday that Zeekr raised a combined US$500 million from five investors - Intel, battery producer CATL, online entertainment firm Bilibili, Cathy Fortune Corporation, an investor in mining businesses and private equity firm Boyu Capital.

They will jointly own 5.6 per cent of Zeekr, established by Geely Automobile and its parent Zhejiang Geely Holding Group in March with a total capital of 2 billion yuan (US$308.7 million).

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Before the financing, the Hong Kong-listed unit held 51 per cent of Zeekr while the parent, which also owns Volvo Cars and a big stake in Daimler AG, held the remaining 49 per cent.

After the fundraising, Zeerk is valued at about US$9 billion.

Carmaker Geely enters China's packed electric-vehicle arena

"This is a first step for Zeekr to establish an ecosystem where all participants' interests are aligned, and opens doors for more strategic cooperation among Zeekr and its partners," the filing said.

The investors are expected to contribute expertise in intelligent connectivity, batteries, young consumer markets and raw materials, it added.

Zeekr is among several brands in China that are looking to gain a leading position in the mainland's premium EV segment, currently dominated by Tesla.

The Zeekr 001 model - to be built at a plant in Ningbo, Zhejiang province - is likely to be delivered to customers later this year.

The model, a four-door sedan with a driving range of 700km, is priced at 281,000 yuan, a little higher than the Shanghai-made Tesla Model 3's starting price of 235,900 yuan.

It will offer air suspension that automatically adjusts ground clearance, and frameless automatic doors that open when a passenger approaches and close behind them.

Baidu and carmaking giant Geely to pour US$7.7 billion into EVs

Designed in Sweden at Geely Design Gothenburg, the Zeekr 001 will use facial recognition to adjust the car's settings to the personal preferences of whoever is in the driver's seat. Over-the-air updates will be conducted at least once a quarter for the lifetime of the car.

Zeekr aims to sell 650,000 vehicles a year by 2025.

"The investors will give Zeekr more than capital," said Qian Kang, a Zhejiang entrepreneur who owns car component businesses. "Geely is a major Chinese carmaker to watch because it has formed quite a few important partnerships with major players in the EV and technology fields."

Earlier this year, Geely formed a raft of partnerships with companies including technology behemoth Baidu, and Foxconn, the world's largest contract maker of consumer electronics, to build smart electric cars as part of its ambitions to become a global leader in the automotive industry.

Swiss bank UBS has forecast that 6.6 million new-energy vehicles - comprising pure electric, plug-in hybrid and fuel-cell cars - will be sold on the mainland in 2025, accounting for 25 per cent of the national total.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.