Chinese automaker Geely Automobile Holdings Ltd. is poised to hit a record-high earnings for 2016, thanks to Volvo, which largely helped boost its sales, Reuters reported.
Geely's 2016 earnings are predicted to jump by 31 percent--the biggest growth it will obtain in eight years.
The firm, which also owns the maker of black cabs in London, purchased the Swedish company back in 2010.The huge increase can be mainly attributed to its affordable models such as the Boyue sport-utility vehicle and the GC9 Sedan, which Geely launched after its Volvo acquisition.
The said models surpassed initial sales prediction.Tapping Volvo's research and development advantage, Geely has rebranded itself as "an automaker with up-market inspirations," Reuters wrote.
As of writing, the Chinese company ranks seventh in the list among the country's carmakers in terms of value.
For 2017, Geely eyes to set foot in developed markets like U.S. and Europe, where it plans to be China's first automaking firm to market its own brand--a new Volvo collab, Lynk & Co.
Though this move is a big and costly risk, investors are optimistic about Geely's capabilities.
"It's a total turnaround story. Before it was just a normal domestic brand, but after several new product launches, it successfully elevated its brand image," a fund manager at an investment company shared.
Last year, Geely's sales in China alone increased by 50 percent, selling a total of 766,000 vehicles. Apart from GC9 and Boyue sales, its small cars that feature Volvo technology also contributed to the figure. This 2017, Geely eyes to hit the one-million mark.
According to a Reuters poll, which involved around 31 analyst estimates, Geely's 2016 earnings likely doubled and reached 4.6 billion yuan. The poll further showed that this statistic will rise by another 52 percent in 2017.
Geely is under its parent company Zhejiang Geely Holding Group Co. Ltd. The two have spent around 10 billion yuan for R&D alone annually for the past four years.