Chinese automaker Geely is all set to launch a premium electric vehicle brand Zeekr. The Zhejiang Geely Holding Group, one of the leading automakers in China, is launching a new electric vehicle to make its claim on the premium segment and challenge the US carmaker Tesla. Geely is rolling out its new car for sale initially only in the homeland.
Similar to Tesla, Zeekr will also open brand showrooms to sell its EV at a fixed price. After initial days in China, the automaker will look elsewhere to sell the vehicle depending on the demand. The government is investing in charging stations and it is projected that EV sales in China will reach 1.8 million by 2021, according to Xu Haidong, deputy chief engineer at China Association of Automobile Manufacturers. This projected growth in the EV segment has prompted new brands to grab their own share in the market. Tesla started in 2019 in Shanghai city and builds Model 3 and Model Y, and with 140,000 sales volume, the investment has begun to pay off.
However, the Chinese auto sector is very new for a country of around 1.5 billion people, and has a long way to be a mature market like the US or Europe. Hong Kong-listed Geely hopes that the shift into the domestic EV market will help renew sales momentum, but it comes with fierce completion from domestic as well as global brands. Also, good portion of the buyers in China will first time own a car and this infancy could assist the brands to lead in sale numbers.
Meanwhile, China has banned Tesla cars from entering housing complexes on military property citing the security concerns over the cameras installed on the vehicles. This move is a new sign of Beijing’s increasing scrutiny of the US automaker amid rising tension with the White House and it shows a close resemblance to President Biden’s measures against Chinese telecom company Huawei on the US security grounds.
Tesla cars have multiple cameras to assist with parking and driving but the images taken by these cameras and their storage control is becoming a new challenge for the car industry and regulators around the world. The use of the direct and indirect tool by Chinese authorities for putting heavy regulatory pressure on foreign brands like tesla is increasing after Washington’s hostility towards China increased in recent time, which may affect the global automobile industry, at least in the electric vehicle segment over the long term.
