Geely Automobile Holdings Ltd ( GELYY Quick Quote GELYY - Free Report) recently inked a strategic agreement with tech conglomerate Tencent Holdings ( TCEHY Quick Quote TCEHY - Free Report) to further develop its digital capabilities and smart car technologies, including intelligent cockpits, and autonomous driving capabilities and low carbon emission technologies. This agreement spans across all aspects of an automotive product lifecycle from product development, manufacturing, marketing, vehicle utilization, to after-sales service with the aim to completely digitalize it. The alliance also encompasses the development of next-generation intelligent vehicle cockpits, amalgamating both Geely and Tencent ecosystems, rolling out new mobile and mobility service applications, and enhancing end-user experience. Within the autonomous vehicle landscape, the two parties will investigate simulated testing and validation of self-driving systems. Through this partnership, Geely and Tencent will also focus on the development of green transportation solutions to achieve carbon neutrality. The latest deal builds upon the existing relationship between Geely and Tencent. In 2018, the companies had collaborated for the first time to form a joint venture with China Railways developing high-speed Wifi, high-speed railway mobility service applications, and other digital services. In 2019, a strategically-invested enterprise under Geely, ECARX, entered into a cooperative agreement with Tencent Auto to join forces on intelligent connectivity services, joint-user operations, AI, and cloud services. Presently, Tencent automotive applications have been successfully incorporated into several Geely models. Per Geely, the global automotive industry is undergoing drastic transitions with new and state-of-the-art technologies, bringing a revolution in the auto sector. In fact, the digitalization of the mobility sector has reached a new height today making it imperative for Geely to digitally transform all aspects of its automotive products. As Geely’s strategic digital partner, Tencent is optimistic about assisting the former in accelerating its digital transformation. The agreement between Geely and Tencent marks the achievement of another milestone in automotive and IT cross-industry cooperation. Further, the latest agreement deepens and strengthens the existing relationship between the two companies to digitalize the entire automotive value chain, while at the same time fulfilling their responsibility to society by jointly promoting sustainable low-carbon development throughout the automotive industry. Geely is a subsidiary of Zhejiang Geely Holding Group, a China-based multinational automotive company headquartered in Hangzhou. Being the owner of Volvo, Geely is one of the most renowned China electric vehicle (EV) manufacturers. But not just Volvo; it also owns other established brands like London Taxi, Lotus, Polestar, and almost 50% of the Malaysia-based brand Proton. Through the wholly-owned company Polestar, Geely manufactures Polestar 1 hybrid performance vehicles in the city of Chengdu and Polestar 2 volume sedans in Taizhou. Geely is building an EV factory in China to make cars under the premium Polestar brand name. The partnership with Tencent, which has investments in EV giants like Tesla and Nio Inc. ( NIO Quick Quote NIO - Free Report) , is the third recent alliance by the Hangzhou-based Geely with companies involved in the technology sector. Earlier this month, Geely announced that it will launch a smart EV company with Baidu Inc. ( BIDU Quick Quote BIDU - Free Report) . Reportedly, the company also announced plans to work with Foxconn to provide contract manufacturing for auto makers. Geely currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Biggest Tech Breakthrough in a Generation
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