Lynk & Co changes sales strategy in Europe in 2024

Lynk & Co, a subsidiary of the Chinese automotive giant Geely, is revamping its sales strategy in Europe in 2024. After struggling with low sales, the company is abandoning its pure online subscription model and is planning to establish its own dealer network. This strategic shift aims to bring Lynk & Co closer to its customers, improving visibility and accessibility in the competitive European market.

Despite being active in Germany and other European countries for several years, Lynk & Co remains relatively unknown to many consumers. In 2022, the brand managed to sell 6,600 units of its plug-in hybrid model, the Lynk & Co 01, in Germany. However, by August 2024, sales had plummeted to just 48 units, signaling the urgent need for a new approach.

The decline of the subscription model

Lynk & Co initially entered the European market with a unique subscription-based sales model. This allowed customers to access the Lynk & Co 01 through flexible car-sharing and subscription services, appealing to younger, urban drivers. However, the demand for such services has been much lower than anticipated. CEO Lopez Appelgren acknowledged that the target market for car subscriptions remains too niche, limiting the company’s growth potential.

“Subscription models are innovative, but the audience for them is still too small,” Appelgren stated in a recent interview. “We need to expand our offering and explore new sales channels.”

To address this issue, Lynk & Co has introduced alternative sales options, including leasing, financing, and traditional rentals. These new offerings provide customers with greater flexibility and could help boost sales by catering to a wider audience, especially in markets where car ownership is still preferred.

Building a dealer network

A key element of Lynk & Co’s new strategy is the creation of a dedicated dealer network. While the company had initially relied on direct-to-consumer online sales, it is now shifting to a more traditional dealership model. Talks with potential dealers are already underway, and by the end of 2024, Lynk & Co expects to have up to ten authorized dealers in Europe. Over the next few years, this number is expected to grow to 30 or 40 dealers.

This move will make the Lynk & Co brand more accessible to European customers, particularly those who prefer a hands-on experience when purchasing a vehicle. The dealer network will also allow the company to offer enhanced services, including maintenance and after-sales support, which are difficult to deliver through an online-only model.

In addition to building a dealer network, Lynk & Co plans to expand its market presence across Europe. Currently active in seven European countries, the company aims to be operating in up to 22 countries by 2025. This broader market reach is expected to be a crucial factor in increasing brand recognition and boosting sales.

A focus on electric vehicles

Lynk & Co is also adapting to the growing demand for electric vehicles (EVs). In October 2024, the company will launch its first fully electric vehicle in Europe, with another EV model scheduled for 2025. This shift towards electric mobility aligns with industry trends, as more consumers opt for sustainable transportation solutions amidst stricter environmental regulations and a focus on reducing carbon emissions.

The company’s focus on electric vehicles is not just about following market trends, but also about positioning itself as a leader in sustainable mobility. As part of this push, Lynk & Co is working to integrate renewable energy into its charging solutions and exploring partnerships with green energy providers to offer eco-friendly charging options at its dealerships.

Appelgren has set ambitious sales targets for the next few years, aiming to sell 75,000 vehicles across Europe by 2027, with at least 10,000 units expected in Germany alone. However, the CEO has acknowledged that pricing will play a critical role in achieving these goals. Currently, the subscription price for the Lynk & Co 01 stands at €629 per month, but this may need to be adjusted to stay competitive in the evolving EV market. “We are probably too expensive right now. We need to be more aggressive in the market,” Appelgren noted.

The road ahead for Lynk & Co

2024 marks a pivotal year for Lynk & Co as it undergoes this significant transformation. By shifting away from a pure online subscription model and embracing a more traditional dealership network, the company hopes to recover from its recent sales slump and better align with customer expectations. With the launch of new electric vehicles and an expanded presence across Europe, Lynk & Co is positioning itself to compete more effectively in the growing EV market.

As the brand continues to evolve, it will be interesting to see how consumers respond to its new approach, and whether Lynk & Co can carve out a larger share of the European automotive market.