ZEEKR unlocks cross-regional liquidity to support growth ambitions

Founded in 2021 and publicly listed on the New York Stock Exchange, ZEEKR Intelligent Technology Holding Limited (ZEEKR) is a Chinese automobile company and subsidiary of Hong Kong-listed Geely Automobile Holdings, that specialises in luxury electric cars. Its first model, the ZEEKR 001 was officially launched in April 2021.

ZEEKR first launched in mainland China and began expanding into Europe, with Sweden and the Netherlands being the first European markets which ZEEKR entered in 2023.

Following its successfully entry into Europe, ZEEKR set its sights on expanding into Asia Pacific next. ZEEKR launched its line of electric vehicles (EV) in Hong Kong and Australia in 2024, and eyes further expansion into Japan, South Korea, Australia, Thailand and New Zealand.

Operating as an independent entity from its parent company, ZEEKR managed its treasury out of its headquarters in mainland China but needed to establish an offshore treasury infrastructure to fund and support its strategic investments, product development and market expansion, with a vision to become a leading premium EV brand by 2030.

In a new partnership alongside HSBC, ZEEKR is implementing a three-tier liquidity pooling structure to connect the firm’s overseas entities and facilitate seamless mobilisation of cash across regions, while mitigating currency exposures.

With a header entity established in Hong Kong and serving as ZEEKR’s offshore treasury hub, a physical cash concentration was setup to connect ZEEKR’s Australia entity to centralise Australian dollar (AUD) balances obtained from local sales activities. Through a non-resident account setup in Hong Kong for its Dutch entity, ZEEKR can connect its Hong Kong and Dutch entities through a notional pooling structure. The notional nature of the cash pool means that AUD balances within the structure can be drawn out in another currency, such as euros (EUR), to meet funding needs in Europe, removing the need for physical conversion of funds.

The unique structure enables ZEEKR to manage short-term liquidity and FX centralisation from its treasury arm in Hong Kong with enhanced account visibility and control and mobilise cash to fund expansions plans and Research & Development activities in Europe.

The Australia-Hong Kong-Netherlands-Sweden connectivity forms the first phase of ZEEKR’s overseas treasury buildout, with new markets and entities to be added to the structure in the second phase, as the business continues to expand geographically.

ZEEKR is also in the process of establishing connectivity between its entities in Hong Kong, mainland China, Thailand, Australia and Mexico, with the bank via host-to-host to enable efficient liquidity management and facilitate ease of daily operations across markets.

• Cost savings from improved FX margins and reduced external borrowing
• Optimised internal funding across markets and regions, with interest cost savings of approximately 3-5% by leveraging internal liquidity
• Notional pooling removes need for actual conversion of currencies, reducing currency exposures and associated FX costs and time
• Centralised account visibility and control through a single global platform to manage bank accounts and cross-market liquidity solutions