(Yicai) Feb. 21 -- Geely Automobile Holdings said it plans to sell its entire stake in a battery swap joint venture to an investment firm owned by Geely group founder Eric Li for CNY504 million (USD70 million), freeing up the carmaker to concentrate resources on new energy vehicle development.

Geely Auto will transfer its 45 percent of Livan Automotive Technology to Geely Qizheng Automobile Technology, expecting a return on investment of about CNY117 million (USD16.3 million), it said in a bourse filing yesterday. The other 55 percent is owned by Lifan Technology.

The transfer should help Geely Auto centralize its resources to enhance its competitiveness in NEVs as the Chongqing-based JV's key battery swap station business is still in the early stages and requires new funding to build an ecosystem and infrastructure, the firm explained.

Developing a battery swap business in China involves significant investment costs and challenges and only a few companies, such as NEV startup Nio and battery titan Contemporary Amperex Technology, have dared to enter the market.

Founded in January 2022, Livan develops electric vehicles with swappable batteries and related facilities. It has brought two NEVs to the market so far. As of last June, the JV operated more than 200 battery swapping stations in 26 cities across China. 

But Livan's sales are slim compared to other Geely group brands. In December, Livan sold only 3,900 vehicles, while Geely brands Galaxy, Zeekr, and Lynk & Co each sold over 10,000 units.

Livan had a CNY622 million loss last year as revenue dropped almost 40 percent to CNY3.5 billion (USD487 million). It had a net profit of CNY15.6 million (USD2.2 million) in 2022.

Geely Auto's stock price [HKG: 0175] rose 1.6 percent to end at HKD8.22 (USD1.10) each in Hong Kong today. The benchmark Hang Seng Index gained by the same amount.

Editor: Emmi Laine