China's Geely to Launch Auto Brand With Ride-Sharing Appeal
October 19 2016 - 6:40PM
Dow Jones News
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.
The car has been "designed for a modern, urban audience who are
used to collaborative consumption and all the benefits that this
brings," Lynk & Co said in a statement.
The company said it would also launch an open digital platform,
inviting developers to create applications for its cars. Sweden's
Ericsson AB and Microsoft Corp. will provide the cars' connectivity
and software services, it said.
Lynk & Co. 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.
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.
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.
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
(END) Dow Jones Newswires
October 19, 2016 18:25 ET (22:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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