Geely Automobile Holdings, a listed unit of Chinese auto giant Geely Holding Group, will sell all of its shares in a battery swap joint venture to an investment company of Geely's founder and controlling shareholder Li Shufu for CNY504 million (USD70 million) to optimize resources to develop new energy vehicles.

Geely Auto will transfer its full 45 percent stake in Livan Automotive Technology to Geely Qizheng Automobile Technology, expecting to earn an investment return of about CNY117 million, the firm announced in a bourse filing yesterday. The remaining 55 percent stake is held by JV partner Lifan Technology.

China's battery swap market is grappling with some growing pains as the convenience favored by car owners requires heavy investments in infrastructure and only a few companies dare to embark on the challenge such as NEV startup Nio and battery titan Contemporary Amperex Technology.

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

Founded in January 2022, Livan develops electric vehicles with exchangeable batteries and related facilities. It has brought two NEVs onto the market so far. As of last June, it operated more than 200 battery swap stations in 26 cities nationwide.

However, Livan's sales are slim compared to other Geely brands. In December, Livan merely sold 3,900 vehicles whereas Geely’s NEV brands Galaxy, Zeekr, and Lynk & Co each sold over 10,000 units.

Livan slipped into a loss last year as revenue dropped almost 40 percent to CNY3.5 billion (USD487 million) from the year before and its net loss tallied CNY622 million in comparison to a net profit of CNY15.6 million (USD2.2 million) in 2022, according to Lifan.

Geely Auto's stock price [HKG: 0175] rose 1.6 percent to HKD8.22 (USD1.10) as of 3.16 p.m.