Geely Auto (00175.HK) expects overseas profit per vehicle to reach as high as ¥15,000 in the first quarter of 2026, approximately three times its domestic margin, management said at a Morgan Stanley conference on Tuesday.
The automaker's management team told investors that overseas expansion and margin growth remain its core long-term strategy, according to a research note from the investment bank.
Geely reiterated its goal to sell 640,000 vehicles in overseas markets in 2026, with progress tracking at 180,000 units in the first quarter. To combat rising material costs for memory and other raw materials, the company is targeting an average cost reduction of ¥7,000 to ¥8,000 per car, noting it maintained strong pricing discipline in the first quarter.
Morgan Stanley maintained its “Overweight” rating and HK$25 price target on the stock, citing the controllable cost inflation and the absence of a price war in the first quarter of 2026 as factors that help sustain profitability.
The company plans to expand overseas production by prioritizing the use of existing plants to avoid large-scale new investments.
This year, Geely is accelerating its product and technology rollouts. The Galaxy and Lynk & Co brands are set for rapid iteration with several major new models scheduled for launch throughout the year. On April 13, the group will officially release its new iHEV technology, which it claims will offer fuel efficiency surpassing global peers. The technology will debut in five of the company's main models and will be paired with a new autonomous driving solution.
The detailed profit outlook suggests Geely's overseas ventures are significantly more lucrative than its domestic business, potentially leading to a positive re-rating from investors. The market will be closely watching the iHEV technology launch on April 13 for the next catalyst.
This article is for informational purposes only and does not constitute investment advice.
