Chinese battery maker Sunwoda settles lawsuit with Geely unit
FILE PHOTO: Geely Auto logo is seen in this illustration taken January 16, 2024. REUTERS/Dado Ruvic/Illustration/File Photo
BEIJING, Feb 6 : A subsidiary of Chinese lithium-ion battery maker Sunwoda Electronic has reached an agreement to settle a lawsuit brought against it by Vremt, automaker Geely's battery unit, a stock exchange filing showed on Friday.
The settlement is expected to hit Sunwoda's 2025 net profit by between 500 million yuan ($72.06 million) and 800 million yuan, the company said in the filing.
Vremt, previously known as Viridi E-Mobility Technology, alleged that battery cells Sunwoda provided between 2021 and 2023 contained defects and took the supplier to court in December, seeking compensation of 2.31 billion yuan, according to a Sunwoda filing in December.
The two have agreed to settle that dispute by sharing the losses incurred through replacement of the battery packs, Sunwoda said in Friday's filing.
Geely declined to comment on the settlement and its impact.
It was not clear how many Geely cars were affected by the battery issue or if Geely plans a recall.
Volvo, owned by Geely Holding, issued plans to recall its EX30 in several markets including Australia, the United States and Canada, citing risks of overheating that could lead to a battery fire in a worst-case scenario.
The Volvo cars being recalled were equipped with batteries from Sunwoda Power Battery Company, the U.S. National Highway Traffic Safety Administration said last month.
($1 = 6.9387 Chinese yuan)
