GEELY AUTO has issued a circular seeking independent shareholder approval for two new framework agreements that will govern extensive related-party transactions from 1 January 2027 to 31 December 2029.
Automobile Components Sales & Purchase Agreement • Counterparties: Geely Holding Group and 16 other connected groups, including Viridi, smart, LEVC Automobile, ECARX and Farizon. • Scope: the Group will sell battery packs, electric drive units, chargers and other parts mainly for Volvo, smart, Farizon and Livan vehicles; it will buy electronics, displays, seats, batteries and other components primarily for Geely, ZEEKR and LYNK & CO models. • Annual caps – Sales by GEELY AUTO: RMB 9.91 billion (2027), RMB 10.19 billion (2028) and RMB 10.54 billion (2029). • Annual caps – Purchases by GEELY AUTO: RMB 55.91 billion, RMB 63.99 billion and RMB 73.14 billion respectively. • Rationale: consolidate multiple existing deals, secure component supply, and enhance production scale; no exclusivity clauses restrict purchasing from third parties.
Powertrain Products Purchase Agreement • Counterparties: Aurobay Technology and Aurobay (Changxing) Transmission. • Scope: procurement of engines, transmissions and related parts for Geely, ZEEKR and LYNK & CO models, with emphasis on hybrid and plug-in-hybrid applications. • Annual caps: RMB 37.07 billion (2027), RMB 37.69 billion (2028) and RMB 39.07 billion (2029). • Basis: cost-plus pricing; margin must remain within the lower-to-upper-quartile range of 12 comparable auto powertrain manufacturers.
Governance & Internal Controls The Group will benchmark prices against at least two external quotations or apply cost-plus margins verified annually by independent accountants. Finance managers will track utilisation monthly; any cap-breach risk triggers immediate escalation and remedial measures. Independent non-executive directors and the Company’s auditors will conduct yearly reviews.
Regulatory & Shareholder Approval Because each agreement’s percentage ratios exceed 5%, the transactions are classified as continuing connected transactions under Chapter 14A of the Hong Kong Listing Rules and require independent shareholder approval. An extraordinary general meeting is scheduled for 16 November 2026 in Hong Kong. Controlling shareholder Mr Li Shufu, Geely Holding, and their associates (collectively holding about 42% of issued shares) will abstain from voting.
If approved, these agreements will replace several existing frameworks expiring on 31 December 2026, aligning GEELY AUTO’s component and powertrain procurement and sales with its electrification and hybrid expansion strategy through 2029.
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