China’s Geely to Launch Auto Brand With Ride-Sharing Appeal
Lynk & Co. intends to sell internet-equipped compact SUVs directly to save on distribution costs
Lynk & Co.'s 01 compact SUV, which the company says will be available for sale only online. PHOTO: LYNK & CO
Zhejiang Geely Holding Group Co., the Chinese auto maker that owns Volvo Cars, is launching a new brand aimed at motorists who like to share their cars.
Called Lynk & Co., the new brand will start selling “01” compact SUVs next year in China, and in Europe and the U.S. from 2018. Lynk & Co. said it intends to sell cars directly to save on distribution costs.
The new car aims to tap into the rapidly growing market of ride-sharing and car-hailing services, embodied by tech giants such as Uber Technologies Inc. of the U.S. and China’s Didi Chuxing Technology Co. The “01” will have a permanent internet connection, allowing owners to share their vehicles with other people and generate rental income.
“We are competing against the likes of Uber as much as we are against other car brands,” said Alain Visser, senior vice president of Lynk & Co. The company said their cars are being “designed for a modern, urban audience who are used to collaborative consumption and all the benefits that this brings.”
Lynk & Co. said it would also launch an open digital platform, inviting developers to create applications for its cars. Sweden’s Ericsson AB and Microsoft Corp. and Chinese e-commerce giant Alibaba Group Holding Ltd. will provide the cars’ connectivity, IT and software services, it said.
The company said it would keep down the prices of its vehicles by limiting sales to online-only, with a fixed pricing model for all markets, and by offering a small number of versions, restricting configuration options and shortening delivery times.
While Chinese car makers have been gaining on foreign rivals at home in terms of design and quality, they are short of brand recognition overseas, and none sell passenger cars in the U.S. and Western Europe. Lynk & Co. said it intends to offer “the best of European design, engineering and technology.”
Based in Gothenburg, Sweden, Lynk & Co.’s models will be based on a platform developed by Volvo and Geely, which has been designed to meet Western crash regulations.
In the coming five years, Lynk & Co. plans to launch at least five models, which will also feature some autonomous-driving capabilities, Mr. Visser said, adding that the company aims to sell more than 500,000 cars by 2021.
The move to launch a new brand reverses a 2014 decision by the company to adopt a single Geely brand. Two years ago Geely scrapped its three separate brands, Emgrand, Gleagle and Englon, to streamline its business.
The manufacturing of Link & Co.’s cars will start in China, but Mr. Visser said the company ultimately wants to construct its cars world-wide.
Geely acquired Volvo in 2010 from Ford Motor Co. and says it has invested more than $10 billion into the Swedish brand.
Write to Matthias Verbergt at Matthias.Verbergt@wsj.com
