Geely reports strong profit growth in China's market

Geely Automobile Holdings Ltd. reported strong earnings for the full year, exceeding analysts' expectations. The company's net income rose 213% to 16.6 billion yuan, or about $2.3 billion. This was higher than the expected profit of 14.6 billion yuan. Revenue also increased by 34%, reaching 240.2 billion yuan for the year ending December 31. The remarkable profit was partly due to a one-time gain from the sale of some subsidiaries. If this gain is excluded, the net income would still reflect a significant 52% increase. Geely sold 2.1 million vehicles last year, which is a 32% rise. Popularity in new electric models, like the Xingyuan hatchback, helped boost sales, even outperforming competitors such as BYD in some months. Despite tough conditions, Geely achieved a gross margin increase of 0.6 percentage points, now at 15.9%. This improvement came from better product offerings and cost-cutting measures. Geely's billionaire founder, Li Shufu, has introduced new strategies like consolidating brands to cut expenses. The company is reacting to stiff competition in the Chinese car market. It faces challenges from BYD, which continues to innovate with features like affordable smart driving technology. While Geely saw export growth of 43%, the company must navigate tariffs in regions like Europe and the US, limiting its market access.