Two leading Chinese electric carmakers, Nio and Zhejiang Geely Holding Group, announced a deal on Monday to combine their battery charging subsidiaries. The transaction includes Nio acquiring a 10 percent stake in Geely’s charging division, while Geely will merge its battery-swapping business into Nio’s larger operation, receiving $95 million for a 30 percent stake. The combined battery-swapping unit aims to operate 10,000 stations by 2030, and Geely’s charging network is projected to reach 22,000 stations by the end of next year. The companies also agreed to coordinate vehicle designs for battery swapping and recharging.

This move follows a broader trend of consolidation in China’s overcrowded auto industry, where overcapacity has driven price wars and financial strain. Guangzhou Automobile Group and First Automotive Works recently announced a tie-up, while Dongfeng Motor and Changan Automobile previously explored a merger. With car sales down 20.8 percent in the first eight months of the year, manufacturers are increasingly turning to exports, which are expected to exceed 10 million vehicles in 2026. However, European officials have expressed concern over the impact on their domestic auto sector, with Volkswagen planning to cut 50,000 jobs.