A subsidiary of Geely Holdings has filed a major lawsuit against battery manufacturer Sunwoda Electronic Co., seeking 2.31 billion yuan (323 million USD) in damages over alleged battery quality problems.
According to Sunwoda’s December 26 announcement, its subsidiary Sunwoda Power Technology received legal documents from the Ningbo Intermediate People’s Court regarding the civil complaint filed by Viridi E-Mobility Technology (Ningbo) Co., Ltd. The lawsuit claims that battery cells delivered between June 2021 and December 2023 had quality defects that caused substantial financial losses.
In its first public response to the lawsuit, Sunwoda told Chinese newspaper Economic Observer: “Although the plaintiff has filed a lawsuit, legal proceedings take time, and the plaintiff’s claims may not be fully valid. As a battery cell supplier, we have conducted extensive testing on the same type of cells. Currently, battery pack systems using our independently designed cells supplied to other customers have not experienced any quality issues. Regarding the specific application scenarios and usage conditions of the battery cells, they did not fully communicate with us from the beginning.”
The litigation is connected to issues with Zeekr 001 vehicles. Since early 2024, numerous Zeekr owners have reported problems after using their vehicles for 2-3 years, including significantly reduced battery capacity, drastically slower charging speeds, voltage instability, and power fluctuations. In December 2024, Zeekr announced it would provide free battery pack replacements for Zeekr 001 WE86 vehicles showing abnormal battery health.
The collaboration between Geely and Sunwoda Power began in 2021, when Sunwoda received a development intent letter from Viridi to supply battery cells for its PMA platform. The PMA platform is a pure electric modular architecture jointly developed by Geely and Volvo, used in Zeekr, Smart, Volvo, and Geely Geometry brand products.
In September 2021, Geely and Sunwoda established a joint venture in Zaozhuang, Shandong Province. Sunwoda confirmed to Economic Observer that the battery cells in question were produced by this joint venture factory.
Industry experts quoted by Economic Observer said that beyond the direct economic losses from battery replacements, the battery quality issues have damaged Zeekr’s brand image, which had long positioned itself as having an exceptional safety record. Zeekr previously promoted itself as “the only new energy brand with zero spontaneous combustion records globally” until a Zeekr 001 fire incident in Yueqing, Zhejiang, in January 2024.
The 2.31 billion yuan (323 million USD) claim represents a significant financial challenge for Sunwoda. Financial reports show that Sunwoda’s net profit attributable to shareholders for 2023 and 2024 combined was only 2.544 billion yuan (356 million USD), just slightly more than the claimed damages.
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