A car produced by Chinese automobile manufacturer Chery is on display for sale at a dealership in Vladivostok, Russia, March 22, 2023.
Tatiana Meel | Reuters
China’s largest vehicle exporter, Chery Automobile, saw its shares jump in its Hong Kong debut after raising 9.1 billion Hong Kong dollars (US$1.2 billion) through an initial public offering.
The stock traded at HK$34.16, about 11% above the IPO price of HK$30.75. Chery is among a wave of Chinese companies tapping Hong Kong’s thriving IPO market.
While the launch proceeded as scheduled, the company canceled its planned listing ceremony at the Hong Kong Stock Exchange due to the city’s shutdown following Super Typhoon Ragasa the day before.
The automaker has been accelerating its expansion in Vietnam, Middle East and Europe. Its SUV-focused sub-brand Jetour will enter Europe this November by launching three combustion-engine sport-utility vehicles in Poland.
The automaker in July announced that it was selling vehicles under its flagship Chery brand in the UK. Chery also rolled out its Jaecoo marque earlier in January and Omoda brand in Britain last year.
Chery has been “a little bit under the radar” as “everyone has been talking about BYD” in the past few years, Sino Auto Insights’ Founder and Managing Director Tu Le told CNBC’s “The China Connection” Thursday.
“They [Chery] manufacture in multiple countries already, so they’re likely the envy of a lot of Chinese EV makers,” he added, noting the brand’s popularity in the U.K. and Australia as well. “We’re seeing a lot of emergence and strength from the Chery brand.”
However, global headwinds remain. In the U.S., Chinese-made electric vehicles face a 100% tariff under Section 301 of the Trade Act of 1974. Canada in October 2024 also matched the U.S. by imposing a 100% tariff on Chinese EV imports. The European Union also implemented tariffs on Chinese-made electric vehicles, with some facing levies of up to 45.3%, effective in late 2024.
Le noted that while Chery does have “some exposure,” to tariffs, the vehicle maker is also building locally in the Middle East and Southeast Asia. That mitigates some of the risk and puts them in a “much better position” than a lot of other players who are looking only to export, said the managing director.
Chery sold 242,736 vehicles in August, of which 129,472 were exported, marking a year-on-year increase of 14.6% and 32.3%, respectively.