China’s Geely beats expectations as Volvo pays off

China’s Geely Automobile Holdings Ltd said on Wednesday that first-half profit more than doubled, scoring its fastest earnings growth in eight years as cars designed with its Swedish unit Volvo won over domestic consumers.

Although known at one point more for its copycat designs and lower quality vehicles, the Hangzhou-based firm has transformed itself into an automaker with up-market aspirations.

Vehicles engineered with Volvo know-how, such as the GC9 sedan and the Boyue sport-utility vehicle, have been hot-sellers in China, the world’s biggest auto market.

“So far in 2017, the group’s performance has exceeded management’s original expectations despite a generally weaker market in China during the same period,” the company said in a statement to the Hong Kong bourse.

Net profit came in at 4.34 billion yuan ($648.96 million), 128 percent higher than the 1.91 billion yuan it made in the same period a year earlier and eclipsing an estimate of 3.61 billion yuan from CCB International.

It said it had decided not to pay an interim dividend.

Sales jumped 89 percent in January-July and last month Geely raised its 2017 sales target by 10 percent to 1.1 million vehicles. It sold 766,000 vehicles last year.

Geely’s parent Zhejiang Geely Holding Group owns the maker of London’s black cabs and this year acquired a 49.9 percent stake in Malaysian automaker Proton.

The carmaker said that the business environment in its previous key export markets in Eastern Europe and the Middle East remained weak and that it would continue to operate its exports business at the current restricted scale for the rest of 2017.

In its next phase of expansion, Geely plans to market a third brand, Lynk & Co – in developed markets next year, beginning with Europe and the United States.

Geely also plans to use more Volvo-developed technologies including small turbo-charged gasoline engines in Geely-brand cars.