The fierce competition in the automotive market, coupled with the need for transformation, is prompting automotive giants to further accelerate their strategic adjustments.

On September 20th, Geely Holding announced to the public that it has entered a new phase of strategic transformation, committing to "focus on the main business of automobiles and unswervingly promote the transformation towards electrification, intelligence, connectivity, and sharing." It also emphasized "prudent operations without blind expansion."

Reporters from China Business News learned from Geely Holding that the various strategic initiatives and arrangements announced by Geely are "a strategic transformation measure formulated in response to the current changes in the global economy and the automotive industry, aiming to elevate Geely's competitiveness and combat effectiveness to a new level."

Public data shows that from January to August of this year, Geely Holding achieved a cumulative sales volume of 2.01 million units, a year-on-year increase of 21.6%, with new energy vehicle sales reaching 824,000 units, a year-on-year increase of 48.5%, and a new energy penetration rate of 41%. Geely Holding stated that it is "in a leading position among global automotive groups."

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"Facing the economic environment and industry competition, we must confront challenges head-on, lay foundations, and hone our skills," said Geely Holding Chairman Li Shufu, who also emphasized the need to "continuously improve the consumer experience and expand market share."

"Prudent operations without blind expansion"

"Geely released the 'Ningbo Declaration' on May 18, 2007, announcing a strategic transformation, not engaging in price wars, but focusing on technology, brand, quality, service, and ethics, and unswervingly pursuing strategic transformation," Li Shufu stated, "The significance of the 'Taizhou Declaration' is, in my view, as important as the 'Ningbo Declaration.'"

Public information indicates that on September 20th, Geely Holding officially released the 'Taizhou Declaration' at the Taizhou International Automobile Industry Expo, declaring that the company has entered a new phase of strategic transformation. The specific strategic transformation includes five major measures and arrangements, which are strategic focus, strategic integration, strategic collaboration, strategic prudence, and strategic talent.

Among the multiple strategic initiatives announced by Geely Holding, the most attention-grabbing is undoubtedly the "strategic focus."

"Focus on the main business of automobiles, unswervingly promote the transformation towards electrification, intelligence, connectivity, and sharing, continue to enhance the core competitiveness in the internal combustion engine vehicle market, build a low-carbon transportation ecological technology advantage, further consolidate and improve Geely's position in the passenger car market, and create an intelligent travel experience that exceeds global users' expectations. Continuously explore new energy commercial vehicle application scenarios and operation models, actively layout multiple technological routes such as pure electric, methanol hydrogen, and range extension, to create new growth points for Geely," said Geely Holding.The reporter noted that this is not the first time Geely has mentioned "focusing on the main business of automobiles." Over the past few years, Geely Holding and its senior executives have repeatedly emphasized the importance of focusing on the main business. For instance, in 2019, Li Shufu called for "We will continue to encourage suppliers and dealers to increase investment in innovation, encourage upstream and downstream industrial chain partners to focus on their main business, specialize and refine their main business, and not to be distracted or disperse energy, thereby affecting the competitiveness of the main business."

Taking Geely Automobile as an example, in the first half of 2024, Geely Automobile achieved a revenue of 107.3 billion yuan, a year-on-year increase of 46.6%; its operating profitability improved, and the profit attributable to shareholders increased significantly year-on-year, with a profit attributable to shareholders of 10.6 billion yuan in the first half of the year, a year-on-year increase of 574.7%.

Against the backdrop of revenue breaking through 100 billion yuan for the first time, Geely Automobile has raised its annual sales target against the trend. It is reported that in 2024, Geely Automobile's annual sales target has been raised to 2 million vehicles, with new energy sales increasing by 70% year-on-year and export sales increasing by 45% year-on-year.

It is worth noting that despite the increasingly fierce market competition, Geely Holding also emphasizes "prudent operation."

"We adhere to prudent operation, do not blindly expand, insist on meticulous cultivation, and fight a good positional war; strengthen corporate governance, improve management efficiency; work with partners, make full use of professional mass production and socialized cooperation, create new advantages in the industrial chain, continuously improve capacity utilization, and effectively reduce costs." said Geely Holding.

Accelerate the layout of the future travel ecosystem

While emphasizing the focus on the main business of automobiles, Geely Holding is also accelerating the layout of the future travel ecosystem.

"Around the main business of automobiles, strengthen cooperation in the fields of 'integrated space and ground', software and hardware layout, basic technology and core component sharing, and modular architecture upgrades in the scientific and technological ecosystem; enhance interaction between various brands and business units, and improve the level of resource sharing; give full play to the systematic advantages of passenger cars, empower commercial vehicle business, and achieve a development pattern where 'passenger and commercial' go hand in hand." said Geely Holding.

Taking the commercial space industry as an example, as a representative of new quality productive forces, it has shown an accelerated development trend in recent years. According to the research report of China Post Securities, from 2019 to 2023, the scale of China's commercial space market increased from 0.8 trillion yuan to 1.9 trillion yuan, with a compound annual growth rate of 23.3%. In 2024, it is expected that China's space industry will carry out about 100 launch missions throughout the year, and the scale of China's commercial space market will break through 2.3 trillion yuan.

In the commercial space field where major giants are competing for layout, Geely Holding has made a series of progress. Information provided by Geely Holding shows that at 2:30 am on September 6th this year, the third orbital plane of Geely's future travel constellation was successfully launched at the Taiyuan Satellite Launch Center in the form of 10 satellites per arrow. The satellites smoothly entered the predetermined orbit, the status of the 10 satellites is normal, and the launch mission was successful.Geely Holding introduced that with the smooth entry of the third set of 10 satellites into orbit, Geely's future mobility constellation has completed the launch deployment of three orbital planes, with 30 satellites in orbit, capable of covering 90% of the global area 24 hours a day. Geely Holding stated, "We will officially provide satellite communication services to overseas users. This is also the first time a Chinese commercial aerospace company has provided low Earth orbit satellite communication services to global users."

However, unlike other companies, Geely Holding's competition in commercial aerospace is aimed at further enhancing the core competitiveness of its own cars.

"At present, the satellite communication chips and high-precision positioning modules independently developed by Geespace have been mass-produced and applied, and the vehicle-mounted satellite communication terminals and high-precision integrated positioning terminals have been mass-produced and installed in vehicles first, fully empowering the intelligent travel experience of users of Geely Holding's brands such as Geely, Zeekr, Lynk & Co., and远程新能源商用车," Geely Holding introduced.

It is worth mentioning that in the "Taizhou Declaration," Geely Holding stated: "We will comprehensively sort out the various business sectors of Geely, clarify the positioning of the business, formulate medium and long-term development goals, adjust and optimize the industrial layout structure, and unswervingly promote the deep integration and efficient integration of internal resources, further clarify the positioning of each brand, straighten out equity relationships, reduce conflicts of interest and redundant investment, and improve the efficiency of resource utilization."

"The 'Taizhou Declaration' is a development consensus reached by Geely Holding after strategic review in the face of new global economic situations and new competition patterns in the industry. The group will focus on the main business of automobiles, layout the technology ecosystem, and enhance competitiveness through five major measures of 'strategic focus, strategic integration, strategic synergy, strategic stability, and strategic talent,'" Geely Holding emphasized.