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In 2026, the Chinese auto industry is in a subtle moment.
Price wars have lasted three years, from fuel cars to new energy, from entry-level to luxury cars, no one can stay out of it. Upstream raw material prices continue to rise, battery-grade lithium carbonate, automotive-grade chips, copper, aluminum, rubber, and other bulk commodity prices remain high.
Downstream markets fall into stock competition, passenger car retail year-on-year slipped over 20% in the first half, but new products and capacity deployment by major car companies did not contract.
OEMs in the middle bear upstream cost pressure from price hikes, cope with high R&D investment for intelligent transformation, and keep discounting to maintain share, profit margins are repeatedly compressed and cut.
'Revenue growth without profit growth' has become the most realistic portrayal of this industry.
CPCA data shows, H1 2026 auto industry revenue 5.19 trillion yuan, YoY +1.8%; Profit 195.4 billion yuan, -20%, profit margin 3.8%, far below industry average 6.5%. CAAM disclosed OEM net profit margin only 1.5%, per car net profit about 3000 yuan, down 70% compared to 5% in 2023.
In such an industry winter, on August 17, Hangzhou, at the Geely Automobile interim results announcement site, an HKEX announcement popped out.
The announcement was very short: Starting August 18, 2026, Li Shufu resigned as Chairman and Executive Director of Geely Automobile Holdings Limited, appointed as Lifetime Honorary Chairman. He is replaced by An Conghui. Li Shufu continues to serve as Chairman of Zhejiang Geely Holding Group.
Half an hour later, performance data was announced, forming a sharp contrast with industry trends: H1 total revenue 173.6 billion yuan, +15% YoY, reaching a historical high, maintaining steady growth for six consecutive years.
Core attributable net profit 9.68 billion yuan, +46% YoY, growth rate clearly outperforming revenue growth, gross margin increased to 17.9%.
New energy vehicle sales 799,500 units, accounting for 56.2% of total sales. Exports 474,200 units, +158% YoY.
Against a domestic OEM manufacturing net profit margin of only 1.5%, Geely turned in a report card with a core attributable net profit margin of 5.6%.
Li Shufu handed over the steering wheel at the peak of performance, and during the most difficult time for the industry, this timing of succession explains more than any statement.
This is not a hasty arrangement, but a succession Li Shufu had prepared for a long time.
Time rewinds to 1996.
On the track field of Hubei University of Economics and Management, a young man from Xinjiang was running. Lap after lap, like trying hard against himself.
His name is An Conghui, just graduated with a major in Modern Accounting, procedures to stay on campus to teach were completed.
In the same year, Li Shufu returned to this school he attended early on to recruit, Geely didn't have an auto factory then, it was just a factory making motorcycle parts.
The two stood by the playground and chatted for over ten minutes, An Conghui later never said what exactly was discussed, only remembered Li Shufu asked him one question, wanting to do something different.
That afternoon he made a rash decision: put down the iron rice bowl, go to Geely as an auditor.
The principal advised him, family members strongly opposed, how can an education staff member go into business?
An Conghui decided to give it a try, when reporting to Geely, only brought a quilt, not a mattress, planning to withdraw back at any time.
What truly made him decide to stay was a bowl of instant noodles.
Once during a business trip sudden landslide occurred, Li Shufu bought several bowls of noodles at a high price from villagers, he went hungry himself, first distributing them to team members.
Many years later, he mentioned a sentence at an internal meeting, tone very flat, not like explaining any great principles. 'I am not a professional manager,' he said, 'I am an entrepreneur.'
Geely's first auto factory was built by An Conghui.
It was 1998, he had been employed for less than half a year, sent to Linhai, needed to build cars on that empty land.
At that time Linhai factory was still mud land, far away only newly erected steel frames. The first car was called 'Haoqing', the day of rollout he led workers to turn non-stop for 24 hours.
Cars came out, but supply chain got stuck.
Tianjin engine supplier wanted to raise price by 5000 yuan per unit, An Conghui flew to negotiate for seven days. Rubbed mouth dry, finally only lowered by 500 yuan, per unit from 22000 yuan to 21500 yuan, for every one sold, Geely still had to lose 3800 yuan.
That night, An Conghui sat alone on the construction site, didn't get up for a long time.
Li Shufu later recalled: 'I will never forget those 7 days in my life, we were forced to sign the agreement. This is unreasonable and unequal for any company.'
This spirit made Geely determine to independently develop, An Conghui volunteered to lead the CVVT engine project.
October 2003, Geely invested 200 million yuan to form a project team. 2006, China's first CVVT domestic engine went into production, Geely finally said goodbye to the era where 'heart' was controlled by others.
After engine came the complete vehicle.
An Conghui almost lived in the R&D center and test track, led the team to disassemble and learn, exploring modern production system.
2009, Emgrand EC7 launched, cumulative sales broke 3.8 million. Then came Lynk & Co, relying on CMA architecture jointly developed with Volvo, that was after Geely acquired Volvo in 2010, An Conghui led the integration development, from brand positioning to product landing full operation. In ten years, Lynk & Co cumulative sold over 1.8 million.
2021, An Conghui who had worked at Geely for 25 years made a decision surprising to the industry: voluntarily stepped down as Geely Automobile Group CEO, started from scratch to create Zeekr brand.
More than three years later, he brought Zeekr to ring the bell at NYSE.
Thirty years, from auditor to billionaire market cap board chairman, An Conghui walked a seemingly impossible path.
Li Shufu's evaluation of An Conghui was straightforward, not like pleasantries: 'Virtuous and capable, excellent character and study, firm career ambition, super strong willpower.'
According to insiders close to Geely leadership, Li Shufu started mentioning An Conghui succession three years ago, at that time not too many took it seriously.
After all, 63 years old counts as prime years among first-generation private car companies, but when Li Shufu spoke about this matter, he was very serious.
This June Chongqing Auto Show forum, Li Shufu said a sentence not publicly spoken before: Geely started succession planning years ago.
Every large company has faced or will face the same threshold.
1993, when Piech took over VW, brand had only three. In his tenure expanded to twelve, twelve brands' global affairs pressed on one person, decision pressure stretched to limit.
2015 emission gate exploded, VW market cap evaporated nearly half, crisis forced VW to split power, distribute to four holding companies.
Effect came fast, H1 2017, VW brand revenue dropped over 20%, profit instead rose from 73 million euros to 869 million euros.
Toyota actively transformed, 1995, Hiroshi Okuda became president, first non-Toyota family helm since 1967.
He put globalization at the forefront, promoted localized production, broke seniority system, promoted new people. He even challenged the founder family, required Akio Toyoda to prove ability when entering the board.
When he resigned in 2006, Toyota global sales 7.92 million, 1.7 times that of 11 years ago.
After this Toyota fixed into a pattern: Family looks direction, professional managers manage operations.
Even if Akio Toyoda holds personal shares, to now less than 0.2%.
These two stories solve two sides of the same problem: one is 'one person can't manage so much', the other is 'family might not be able to manage always'.
Combined pointing to a conclusion: reaching a certain volume, enterprise must turn from relying on people to relying on systems.
Volkswagen used decentralization, Toyota used professional managers, Geely's answer is combination of both, a pre-built three-layer structure.
Holding layer is Geely Holding, Li Shufu still there, manages strategy and capital. Operating layer is Geely Automobile Group, these years managed by An Conghui, Gan Jiayue etc. Listed layer is 0175.HK, previous chairman Li Shufu, now changed to An Conghui.
Three drivers each do their duty: An Conghui coordinates strategy and capital, Gui Shengyue dedicatedly acts as communication bridge between board, management and shareholders, Gan Jiayue focuses on daily operations.
Li Shufu removed is not boss identity, he is still controlling shareholder, still Chairman of Geely Holding, he removed is specific position of listed company operator.
Core of this architecture, is separating ownership and operation - Family holds direction, managers manage implementation.
This 'Family Holding, Professional Operation' model, home appliance circle had precedent.
He Xiangjian handed Midea to Fang Hongbo team, enterprise passed multiple industry cycles, but auto industry no company of equal volume private car enterprise has done so.
Difficulty lies: previously relying on Li Shufu personal prestige knitted together cross-brand synergy, can it become institutional ability? Professional manager team after founder retreats to background, can still hold strategic fortitude? These questions, is exactly what this succession needs to answer.
Li Shufu stated in video speech, Geely will strictly implement enterprise three-layer governance structure, cultivate professional talent, build professional team. He emphasized, to 'ensure enterprise three-layer governance structure operates effectively and transparently'.
After governance structure sorted out, most direct change is strategic direction becomes clearer.
In the past leader to watch matters too many, globalization priority pushed to back. An Conghui self judgment on globalization very clear.
When taking over Zeekr, he found, China new energy vehicle tech advantage can completely export overseas. Now he only needs to focus strategy, this matter only truly pushed to forefront.
From Europe to SE Asia to South America, Geely factory layout is piecing out a world map.
Volvo Europe factory to take over Geely luxury cars, Proton Malaysia factory to expand to 500k, Spain factory also planning 500k capacity.
H1 exports 474,200 units, +158% YoY, overseas channels broke 2000, covering 114 markets. Full year target from 640k raised to 920k, moving towards million units.
Market reaction not slow, announcement day, Geely Auto HK stock rose 4.77%, closed at 18.67 HKD, market cap once broke 200 billion HKD. But next day stock opened high then turned drop.
Capital market watching: This system, really can run?
Performance itself holds water. 173.6 billion revenue, 6 years consecutive growth, net profit 9.68 billion, +46% YoY, gross margin 17.9%.
According to CAAM data, domestic OEM manufacturing link average net profit margin fell to 1.5%, created nearly 10 year new low.
This report card placed in industry background, gold content more obvious. H1 cumulative buyback 1.885 billion HKD, July per share dividend 0.5 HKD, +51.5% YoY.
An Conghui candidly admitted in performance meeting, Geely currently still 'lacks blockbuster products'. Audience quiet for few seconds.
A newly appointed board chairman, admitting weakness during first public appearance, not very common.
But he next gave timeline: H2 Galaxy to launch a hardcore SUV called 'Warship 700', Lynk & Co also launch new G20. R&D investment H1 9.06 billion, +8% YoY, admin expense ratio dropped to 1.7%. Expenses go down, R&D goes up, scale effect realizing. Geely still putting some businesses that ran out into listed company.
Data answered 'how is effect', but there is a bigger question not answered: What does this mean for other private enterprises?
Most private enterprises chose family style route, Zong Fuli took Wahaha, Cao Hui took Fuyao.
Li Shufu took another path. His son Li Xingxing holds Geely Holding 8.06% shares, serving on parts and capital platform, while listed board chairman position given to a professional manager who worked together for 30 years.
Li Shufu repeatedly said internally, Geely does not do family management, talent forest strategy must be continued.
2026 China Auto Chongqing Forum, he gave speech titled 'Enterprise Succession and Value Orientation', proposed a layered logic: Enterprise spirit originates from employee spirit, employee spirit originates from management spirit, management spirit originates from value orientation.
He defined essence of succession as 'passing enterprise core values, management systems, governance systems completely to next generation helm and management'.
Gui Shengyue spoke more directly at results meeting. He said this personnel change is Geely 'de-familyization' declaration, 'marks Geely Auto has moved from founder driven startup and development period, towards system and team driven maturity period. Enterprise will no longer rely on personal charm and authority, but rely on org systems and talent ladder'. For internal talent, 'ceiling broken'.
Geely special just special in, Geely not only chose this less walked path, but stepped out actively when performance best.
Not founder old can't hold up then hand, not crisis came temporary catch person save fire, is when applause loudest stepped back himself.
Among millions facing same problem private enterprises, Geely solution provided 'third choice', neither blood inheritance, nor external air drop, but internal trained sons and soldiers take over.
When founder gradually exits specific operations, can this system still make correct decision itself, will be market long term focus, An Conghui experience gives a possibility.
A person grown in system for 30 years, knows more clearly than anyone where system switch is.
1998 that one sitting Linhai site mud ground young man, probably wouldn't think, 28 years later he will take over a 100 billion listed company, An Conghui response also simple: 'Hold this baton well, pass this baton'.
Li Shufu used 40 years built this company, also used 40 years figured out one thing: Enterprise vitality, should not tie on one person, must embed into system.
'Tao Te Ching' has a sentence: 'Give birth but not possess, act but not rely, achievement completed but not dwell. Only because he does not dwell, thus it does not depart.'
He told a sentence roughly same meaning vernacular: Founder biggest contribution, is letting enterprise after he leaves can continue forward.
Geely's succession, final meaning might not just on Geely itself.
Among millions private enterprises facing same choice moment, Geely provided a worth seeing sample - hand stage to system, hand future to comrades.
A great entrepreneur can do most important thing, probably this is one of them.
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