KG Mobility's Bold Bet on Chery Platforms: A Strategic Leap or a Risky Gambit?

In the ever-evolving landscape of the automotive industry, partnerships and alliances are becoming the new norm. The latest in this trend is the collaboration between South Korean automaker KG Mobility and China’s Chery Automobile. This partnership, announced on April 1, 2025, aims to develop mid-to-large-sized SUVs, a segment that is experiencing unprecedented growth. But is this a strategic leap forward or a risky gambit that could backfire?

The SUV market is booming, with projections indicating it will reach 53 million units by 2030, growing at a CAGR of 4.4%. This growth is driven by consumer preferences for larger, more versatile vehicles that offer advanced safety and comfort features. The Asia Pacific region, which includes both South Korea and China, is at the forefront of this trend, making the partnership between KG Mobility and Chery a strategic move.



The collaboration is not just about developing new SUV models; it is about leveraging each other’s strengths. KG Mobility brings 70 years of technological know-how, while Chery offers a global platform. This synergy is expected to accelerate the development of KG Mobility’s mid-to-large-sized model, codenamed SE-10, with completion targeted for 2026. The partnership also extends to other advanced technologies such as self-driving and electrical/electronic (E/E) architecture based on software-defined vehicles, positioning both companies as leaders in future mobility.

However, this partnership is not without its risks. The automotive industry is highly competitive, and the SUV segment is no exception. The high cost of SUVs compared to sedans and hatchbacks could be a significant barrier for consumers on a tight budget. Additionally, the regulatory environment is becoming increasingly stringent, with a global focus on electric and hybrid vehicles. KG Mobility’s plans to develop eco-friendly models for niche markets are a step in the right direction, but the transition to more sustainable technologies will require significant investment and adaptation.

The partnership also raises questions about dependency. KG Mobility’s heavy reliance on Chery for technological and platform support could limit its flexibility and innovation. Any issues or delays on Chery’s end could directly impact KG Mobility’s development timeline and market competitiveness. This dependency is a double-edged sword, offering both opportunities and risks.

In conclusion, KG Mobility’s partnership with Chery is a bold move that aligns with current market trends and offers strategic advantages. However, it also comes with significant risks and challenges. The company must navigate the complexities of dependency, intense competition, and regulatory challenges to ensure its long-term success. Only time will tell whether this partnership is a strategic leap forward or a risky gambit that could backfire.