The Zhitong Finance App learned that Citi released a research report stating that it reaffirmed the “buy” rating of Geely Auto (00175), and that the target price remained at HK$30.

According to the bank, Geely has signed an agreement with Ford to acquire 34% of its shares in the idle Body3 plant in Valencia, Spain, involving 221 million euros (same below). The plant is designed to have an annual production capacity of 400,000 vehicles, and its net profit for fiscal year 2025 was 70 million euros (236 million euros in fiscal year 2024). If Geely finally gets an annual production capacity quota of 150,000 vehicles, the estimated cost is only 10% to 20% of the new Greenland Plant. The deal is expected to be completed in the fourth quarter of 2026, which will help Geely enter European automobile production using the component assembly (CKD) model. The market is expected to respond positively to this.

The bank pointed out that for Geely, this agreement is a landmark breakthrough in its long-term European expansion strategy. Localized production bases help companies avoid the EU's possible import tariffs on Chinese electric vehicles, and greatly enhance price competitiveness. Furthermore, Geely can directly use Ford's existing manufacturing infrastructure and local supply chain network to shorten the overseas layout cycle and monetize its electric vehicle technology through licensing and foundry revenue.

Disclaimer:Webull uses external vendor Google Translation Service for news translations where we endeavour to ensure these are correct, however, we recommend that you please double-check this information accordingly. Webull is not responsible for translation errors or issues.