ZK Q1 2025: Reaffirms 710K Sales Goal, Eyes High-Margin 9X/8X Launches
- Robust Sales Targets and New Product Momentum: Management reaffirmed full-year sales targets of 710,000 vehicles (with 320,000 for Zeekr and 390,000 for Lynk & Co), and highlighted that recent launches like the Zeekr 007 GT and Lynk & Co 900 have already delivered strong early orders and positive market feedback, indicating potential acceleration in sales from Q2 onward.
- Improving Margins with High-Margin New Models: The executives emphasized that upcoming models such as the Zeekr 9X and Zeekr 8X are expected to deliver impressive margin performance and higher vehicle margins compared to current offerings, driven by their unique super electric hybrid powertrains and premium positioning.
- Advanced Super Electric Hybrid Technology as a Competitive Edge: The new super electric hybrid technology was noted for its best-in-class driving performance, ultrafast charging capabilities (900-volt system), enhanced fuel efficiency, and lower maintenance costs. This positions the models to outperform conventional PHEVs and EVs, helping capture significant market share both domestically and overseas.
- Subpar near-term sales performance: Management acknowledged that April's sales were "not that satisfying" even though they remained "in line with management's expectation," which could hint at persistent execution challenges in the near term.
- Reliance on future product launches: The ability to achieve the full-year sales target largely depends on upcoming models (e.g., Zeekr 9X, 8X, Lynk & Co mid to large sedan) delivering strong market performance amid uncertain market conditions. ** **
- Uncertainty over the pending privatization offer: Management’s reluctance to comment on the privatization offer and the associated regulatory constraints could signal strategic or capital allocation uncertainties that may unsettle investors.
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Vehicle Deliveries | FY 2025 | 710,000 vehicles (Zeekr: 320,000; Lynk & Co: 390,000) | 710,000 vehicles (Zeekr brand: 320,000; Lynk & Co brand: 390,000) | no change |
Vehicle Margin | FY 2025 | 15% vehicle margin | 15% vehicle margin | no change |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Robust Sales Targets | Q4 2024: Consistently set at 710,000 units for 2025 with emphasis on strong financial positioning despite market competition. | Q1 2025: Reaffirmed the same target with acknowledgment of an unsatisfactory April performance but optimism for improvement driven by new product launches. | Consistent focus on high targets, with slight caution regarding near‐term performance in Q1. |
New Product Momentum | Q4 2024: Outlined a strategic cadence for launches (e.g., Lynk & Co 900, Zeekr 007GT, and a new SUV in Q4) to boost growth. | Q1 2025: Detailed recent launches (Zeekr 007 GT, Lynk & Co 900) and introduced upcoming models (Zeekr 9X, 8X) with strong customer recognition and order volumes. | Enhanced clarity and positive momentum with actual market reception and more concrete execution in Q1. |
Near-Term Sales Performance and Execution Challenges | Q4 2024: Acknowledged unsatisfactory Q1 sales and execution challenges, while expecting improvements through product launches and ADAS enhancements. | Q1 2025: Noted April's underperformance due to absence of new launches in Q1, but highlighted organizational changes and upcoming models as remedial actions. | Continued challenges but with increased remedial focus and clearer strategies in Q1. |
Reliance on Future Product Launches for Growth | Q4 2024: Emphasized strategic reliance on a steady flow of new products and facelift versions as growth drivers throughout 2025. | Q1 2025: Reiterated the plan with concrete examples of launches already underway and communicated expectations for significant growth contributions from these models. | Consistent reliance on new launches with a more executed and detailed plan in Q1. |
Margin Improvement Initiatives via High‐Margin Models and Cost Synergies | Q4 2024: Focused on launching high-margin SUVs using super electric hybrid technology and achieving around a 15% margin through cost synergies following integration. | Q1 2025: Reported record margins (16.5% overall, 21.2% for Zeekr) achieved through improved cost controls and scale efficiencies, with detailed synergy benefits. | Margin performance exceeded projections with a clear shift toward a highly positive outlook in Q1. |
Advanced Super Electric Hybrid Technology | Q4 2024: Announced upcoming large SUVs incorporating the technology to benefit from higher gross margins, with emphasis on fast charging and advanced features. | Q1 2025: Provided in-depth details on the technology’s performance, capacity, charging capabilities, and its market potential in both domestic and global markets. | More detailed and integrated strategy confirming technological leadership and market expansion. |
Emergence of ADAS Capabilities as a New Technological Edge | Q4 2024: Focused on a unified ADAS solution shared across brands with strategic platform integration, including LiDAR and NVIDIA technology. | Q1 2025: Expanded details on differentiated systems (e.g., Level 3 in Zeekr 9X, distinct HMI designs between brands) with robust specifications and rollout plans. | Continued emphasis with enhanced technological details and clear differentiation in Q1. |
Integration Risks in the Consolidation of Lynk & Co and Zeekr | Q4 2024: Actively discussed integration efforts, risk mitigation via mid and back-office consolidation, and measures to cut internal competition. | Q1 2025: Did not explicitly mention integration risks; instead, focused on positive outcomes, synergies, and improved financial metrics from the integration. | Risk concerns de‐emphasized in Q1, shifting the narrative toward successful synergy realization. |
Intense Competition in Domestic and International Markets | Q4 2024: Explicitly acknowledged intense competition, detailing strategic measures to defend market share and maintain competitive pricing. | Q1 2025: Competition not explicitly mentioned, though strategies such as network expansion hint at addressing market challenges. | Reduced explicit focus on competition in Q1, potentially reflecting improved market positioning or internal confidence. |
Disappearance of Privatization Offer Uncertainty | Q4 2024: Not mentioned. | Q1 2025: Clarified that management would not comment on the privatization offer due to disclosure rules, establishing a special committee for communication. | New topic emergence in Q1, where uncertainty is managed through regulatory compliance and controlled communication. |
Shifts in Sentiment on Margin Projections and Sales Outlook | Q4 2024: Demonstrated optimism about margin growth and forecasted sales targets, with strategies to leverage new models and cost efficiencies amid competition. | Q1 2025: Reported record-high margins and reaffirmed robust sales targets despite short-term sales dips, showing strengthened confidence based on actual performance. | Optimism reinforced in Q1 with improved margins and a firm outlook, building on the optimistic projections from Q4. |
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Sales Guidance
Q: What is the full-year sales target?
A: Management confirmed that despite a modest April showing, they expect to deliver 320,000 Zeekr and 390,000 Lynk & Co vehicles this year—totaling 710,000 units—with a boost from new model launches planned in the coming quarters. -
New Models
Q: What are margins for 9X/8X models?
A: Management emphasized that the new Zeekr 9X and 8X, featuring breakthrough 900-volt technology and luxury positioning, are anticipated to deliver strong margins and drive volume growth, both domestically and globally. -
Hybrid Tech
Q: What advantages does super hybrid offer?
A: They highlighted that the super electric hybrid technology provides superior acceleration, excellent fuel efficiency, and lower maintenance costs, targeting a contribution of 150,000–200,000 vehicles per year, setting it apart from typical PHEVs.