What is Geely Automobile s plan to sell the battery swap business to a major shareholder?

Mondo Finance Updated on 2024-02-21

The development of new energy vehicles is in full swing, and every move of car companies is also attracting attention.

Except for BYD (002594SZ), Changan Automobile (000625SZ) and many other car companies started the year with a violent "volume", and in addition to the price reduction, Geely Automobile (00175HK) announced that the battery swap business has also attracted the attention of some investors.

**The battery swap business attracts attention from major shareholders

On February 20, Geely Automobile announced that Zhejiang Jirun, a subsidiary of the company, entered into an equity transfer agreement with Geely Qizheng, and Zhejiang Jirun agreed to ** and Geely QizhengAgreed to purchase a 45% stake in Ruilan Automobile for a cash consideration of 50.4 billion yuan(RMB, the same below).

After the completion of **, Geely Automobile will no longer hold any shares in Ruilan Automobile, and it is expected that the transaction will bring 1$1.7 billion in revenue.

Ruilan Automobile will be operated by Lifan Technology (601777SH) and Geely Qizheng hold 55% and 45% of the shares, respectively.

It is worth noting that Geely Qizheng is a wholly-owned subsidiary of Geely Automobile Group, which is owned by Geely Automobile's major shareholder and its associatesTherefore, this equity transfer is actually a related party transaction.

It is worth noting that Geely Qizheng is a wholly-owned subsidiary of Geely Automobile Group, and the equity belongs to the major shareholder of Geely Automobile and its related parties, so this equity transfer is actually a related party transaction.

According to the official website, Ruilan automobile models include Ruilan 7 and Ruilan 9, with a starting price of 11770,000 yuan, 15990,000 yuan. It is reported thatRuilan Automobile will launch battery swap business in 2022. Ruilan Automobile also said,In the future, it will aim at the battery swap marketAt the same time, we will make efforts on the B-end and C-side, and plan to cover cars, SUVs, MPVs, and even logistics vehicles and light trucks to fully meet the needs of different markets such as online car-hailing, private cars, taxis, and logistics vehicles.

In terms of performance, in 2022 and 2023, Ruilan Auto will achieve revenue of 583.9 billion yuan, 348.3 billion yuan,The net profit attributable to the parent company was 1558840,000 yuan, a loss of 62.2 billion yuan.

It is understood that Lifan Technology once said on the investor interactive platform that Ruilan Automobile has adhered to B+C-end two-wheel drive since the launch of C-end products in 2023, but as a new brand, Ruilan Automobile still needs a certain process to promote its brand in the C-end market, and there are fewer models to choose from, and it has not taken significant price reduction measures to fully participate in the competition, and has been under great pressureAt the same time, the sluggishness of the B-end new energy market has also led to a great impact on the overall sales of Ruilan Automobile.

Geely Automobile explained the reason for the equity in the announcement, saying that the current battery swap business of Ruilan Automobile is still in the initial stage, and it is expected that the main resources and continuous capital investment will be used to build the battery swap ecology and related infrastructure. But,Considering the Group's competitive advantage in China's automotive market, the Group will focus a significant amount of resources on supporting the growth of new energy vehicles and enhancing its overall competitiveness through the battery swap business.

Geely is going to give up battery swapping cars?

It is worth mentioning that after the equity of ** Ruilan Automobile, some investors believe that Geely intends to give up the battery replacement car.

Yang Xueliang, senior vice president of Zhejiang Geely Holding Group, said that this time it was Geely's listed company that transferred the shares of Ruilan Automobile to Geely Automobile GroupGeely will continue to work with Lifan to support the development of Ruilan, and increase the layout and investment in the field of battery swappingThere is still a lot of room for innovation and cooperation in this track, and Geely will definitely become a leading enterprise.

The so-called battery swap mode is to replace the battery of the new energy vehicle to meet the battery life needs of the car owner, which is a mode of separating the car from the battery for energy replenishment.

Different from the charging mode of the charging pile, the battery swap mode can save the car owner's energy replenishment time. In terms of safety, battery swapping has certain advantages over charging. At the same time, the battery swap mode can also effectively alleviate the load on the power grid. However, the difficulties of the battery swap model lie in heavy assets, low degree of battery standardization, and high dependence on customer density for profitability.

With the continuous progress of battery swap technology and the continuous maturity of the business model, the battery swap mode has become an important direction to promote the construction of new energy infrastructure, and has issued the "Implementation Opinions on Further Improving the Service Guarantee Capacity of Charging and Swapping Infrastructure" and "Notice on Launching the Pilot Work of the Application of Battery Swap Mode for New Energy Vehicles" and other policies to support it.

More importantly, the first departments and industry associations are also promoting the unification of battery swap batteries and interface standards, and are gradually solving the pain points of battery swap station losses.

At present, the leader of the battery swap track is the new car-making force NIO (09866.).HK), which owns the vast majority of battery swap stations on the market.

In addition, BAIC, Geely, Changan and other car factories are also actively entering the field of battery swapping, accelerating the launch and mass production of battery swapping models, and promoting the layout of battery swapping stations in a planned manner; On the other hand, battery swap station operators such as Aodong, Botan, and GCL-ET have accelerated the construction of battery swap stations and actively cooperated with OEMs.

On the whole, as one of the important ways to supplement the energy of new energy vehicles, the battery swap mode at the current stage has its unique advantages, so some institutions have analyzed thatThe construction of battery swap stations will usher in a period of rapid development.

Conclusion

According to industry insiders, Ruilan Automobile, as an important chess piece of Geely's layout in the field of battery swapping, this equity change will better promote the better development of Ruilan Automobile in the field of battery charging and battery swappingIt is not ruled out that Ruilan will be listed separately in the future. Whether this speculation is reliable remains to be seen.

Author: Yan XIV.

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