Geely Plans New Brand for China

Next year Zhejiang Geely Holding Group Co. will introduce a new brand in China with vehicles that ride on the “compact modular architecture” platform developed by its Volvo Car unit.

Code named “L,” the lineup will debut with an SUV and add a sedan later, sources tell Reuters. Geely and Volvo declined to comment.

The new Geely nameplate will be marketed through the company’s existing dealer network rather than separate outlets as the company has done previously with sub-brands. The L-models will compete with Chinese marques being introduced by other ventures between foreign and local brands.

Analysts note the brand will face fierce competition in an already overcrowded market. But sources tell Reuters that Geely considers the new line critical in its long-term plan to enter the European and American markets.