Chinese billionaire Eric Li’s decision to privatize Zeekr, a New York-listed electric vehicle (EV) brand, marks a significant shift for the company just one year after its U.S. initial public offering (IPO). According to a Forbes report, parent company Geely Automobile will buy out Zeekr’s remaining shares for $2.2 billion, delisting the EV maker as geopolitical tensions rise between the U.S. and China.

Geely’s Strategic Buyout of Zeekr

Geely, which has seen its Hong Kong-listed shares surge by 25% this year, announced plans to acquire Zeekr’s American Depository Shares (ADS) at $25.70 each, as per a recent stock exchange filing. With Geely already owning 65.7% of Zeekr’s total shares, the deal will see the parent company take full control of the EV brand, valued at $6.4 billion. The move comes after Zeekr’s U.S. IPO in May 2024, highlighting a rapid pivot in strategy amid growing scrutiny of Chinese firms listed on American exchanges.

Analyst Ke Yan, Singapore-based head of research at DZT Research, told Forbes via WeChat that privatization could be a strategic move to “preempt moves to delist Chinese companies from American bourses as tensions rise between the world’s two largest economies.” This follows a recent letter from Republican lawmakers to the U.S. Securities and Exchange Commission, alleging that Chinese companies like Zeekr, Alibaba, JD.com, and PDD Holdings support China’s military while attracting American capital.

Industry Trends and Geopolitical Pressures

The decision to privatize aligns with broader trends in the EV industry, where Chinese manufacturers face increasing regulatory challenges abroad. Zeekr’s delisting reflects a growing caution among Chinese firms as U.S.-China relations strain, particularly in technology-driven sectors like EVs and drones. By going private, Zeekr can avoid potential sanctions or forced delistings, a fate already looming for other Chinese tech giants.

Geely’s Eric Li, with a net worth of $16.4 billion, has been steering the firm toward global expansion, acquiring brands like Lotus, Lynk & Co, and Volvo Cars. Privatizing Zeekr allows Geely to consolidate resources and focus on competitive markets without the pressures of U.S. regulatory oversight. Analyst Yale Zhang, Shanghai-based managing director at Automotive Foresight, noted via WeChat that this move can “improve efficiencies, adjust supply chain resources, and better position the brand to compete with the likes of Xiaomi.”

Operational Benefits for Zeekr’s Future

Privatization offers Zeekr operational advantages, especially in a highly competitive EV market. Zhang estimated that Zeekr could meet its target of delivering 320,000 vehicles in 2025, a 12% increase from the 285,441 units delivered in 2024. This growth is supported by Geely’s streamlined operations, which reduce internal competition and enhance supply chain management. For EV enthusiasts, this could mean more reliable access to Zeekr’s sleek, tech-forward models, often showcased in modern showrooms like the one in Yantai, Shandong province.

What This Means for EV Owners and Enthusiasts

For EV owners and enthusiasts, Zeekr’s privatization might signal more innovation and availability in markets outside the U.S. Without the burden of public reporting, Zeekr can double down on R&D, potentially accelerating advancements in battery technology and autonomous driving features. However, U.S. consumers may see reduced access to Zeekr models if geopolitical tensions further limit Chinese EV imports.

Geely’s move underscores the delicate balance Chinese EV makers must strike between global ambition and regulatory realities. As the EV industry evolves, Zeekr’s privatization could set a precedent for other firms navigating similar challenges, reshaping how Chinese brands engage with international markets.