By on February 24, 2018

2017 Mercedes-Benz C350e grille hood ornament - Image: Mercedes-Benz

Unlike German auto titans BMW Group and Volkswagen Group, Mercedes-Benz parent company Daimler didn’t have the stabilizing effect of a family or individual with a massive, long-term cache of company shares. That’s no longer the case, as Geely Group owner Li Shufu has announced his purchase of a 9.69 percent stake in the German automaker.

This makes Shufu Daimler’s largest single shareholder.

The Chinese auto tycoon, whose Zheijang Geely Holding Group manages car-producing Geely Group, already owns Volvo Cars and Lotus, and is a major shareholder in truck builder Volvo AB. Always on the hunt for opportunities, the near 10-percent stake in Germany’s largest luxury automaker should give Shufu the partnership he’s looking for. 

“Daimler is an outstanding company with a first-class management. It will be an honor to support this unique team under the leadership of Dieter Zetsche in the future,” said Shufu in a statement. “I am particularly pleased to accompany Daimler on its way to becoming the world’s leading electro-mobility provider.”

Neither Geely Group nor any other subsidiary in the holding company plan to purchase more Daimler shares, at least “for the time being.”

While Shufu didn’t go into further product details, the share buy reportedly comes with the intent to partner with Daimler on electric vehicle production. Having access to the German company’s electrification technology would give Geely a technological edge in both the rapidly growing (and EV-heavy) Chinese market and the automaker’s export markets. To Shufu, the industry is now on a war footing, fighting against marauding high-tech startups.

“The competitors which technologically challenge the global car industry in the 21st century are not part of the automotive industry today,” he said. “But with challenges come opportunities. No current car industry player will be able to win this battle against the invaders from outside independently. In order to succeed and seize the technology highland, one has to have friends, partners, and alliances and adapt a new way of thinking in terms of sharing and united strength. And we have act now.”

For its part, Daimler seems pretty pleased that Shufu’s in it for the long haul.

Stating that its new shareholder recognizes the “innovation strength, the strategy and the future potential” of the automaker, Daimler said it “knows and appreciates Li Shufu as an especially knowledgeable Chinese entrepreneur with clear vision for the future, with whom one can constructive discuss the change in the industry.”

[Image: Daimler AG]

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33 Comments on “Geely Group Owner Enjoying His 103,619,340 Shares in Daimler...”


  • avatar
    Big Al from Oz

    Geely have had pretty much a hands off approach with Volvo, so I don’t think it matter who owns what in any business.

    A business person from any country will not try and screw a business up, unless you are German dealing with diesel engines.

    • 0 avatar
      Asdf

      Geely has closed a Volvo plant in Sweden, built three new plants in China, and moved production of the S90 from Sweden to China. That says everything about Geely’s intentions. People have been fooled because Geely is taking things slowly and not moving everything to China on day 1.

      • 0 avatar
        Big Al from Oz

        Asdf,
        So, production moved to China. I really think this idea that production must remain in a certain location/country is nonsense.

        So, what about all the production in the US that used to be in Europe in the 19th and early 20th Century?

        Trade flows as the world becomes smaller trade will move from place to place more frequently, this is good because it generates competition, which means progress.

        I read a comment the other day regarding how Leyland no longer exists, but it does, in China as LDV, Leyland DAF Vehicles and they are producing some very competitive vehicles, far better than anything BMC ever produced.

        In some ways the Chinese entering into the industry is keeping alive businesses that might otherwise go away for ever.

        • 0 avatar
          thornmark

          Well, you lived it. Australia has no auto manufacturing. Poof! Gone!

          Australian car production ends this week. Here’s why
          Domestic car production faced pressure for decades before caving in to market realities –

          http://autoweek.com/article/car-news/heres-why-car-production-australia-ending-week#ixzz585uVb7yG

        • 0 avatar
          Asdf

          @Big Al from Oz: Tell that “nonsense” line to all those Swedes who have lost their jobs, or who definitely will, as a direct and inevitable result of Chinese ownership. Because the end-game is clear – in the future, *all* production and R&D of Volvos will be in China (to the detriment of consumers and build quality, I might add). And with Geely buying up Daimler, the same will eventually apply to Mercedes-Benz. But I’m sure that’s “Unsinn” to you, just like the “struntprat” about Volvo.

        • 0 avatar
          bd2

          The difference being that auto production (a major wealth builder) moving to China only increases the financial wherewithal of the PRC which is increasingly a totalitarian state (under Xi) willing to throw its weight around the world, not just militarily but with $$ and soft power.

          Officials in Oz have raised the alarms of China’s meddlings in Australian politics and there have been workers fired for claiming to Taiwanese in businesses owned by the Chinese.

      • 0 avatar
        civicjohn

        asdf,

        Nobody saw something like this coming? What a nice paved road into China for MB, and should probably put a few Tesla fans wondering where they stand with the Chinese government.

        I think this is a win for both and will put some serious pressure on Tesla, while Mr. Musk has in the past “tweeted” his intentions with China, he may be better served with “partnerships”.

        No, Tesla dudes, this is not click-bait, but you may have been outflanked.

        • 0 avatar
          Big Al from Oz

          civicjohn,
          I see the Chinese massaging their auto industry for the future. I’ve been predicting the Chinese want a huge slice of the bread and butter consumer appliance EV market down the track.

          China also adopted global standards for vehicle harmonisation, which also facilitates trade. This leaves the US industry in an Easter Island situation.

          As for Tesla, it missed the EV boat, even GM is further advanced than Tesla and the EU prestige manufacturers are throwing lots of cash into developing prestige EVs.

          Yup, Musk might need to sell off everything other than SpaceEx, which is supported heavily by the US taxpayer…. most likely to the Chinese like Volvo.

          • 0 avatar

            “Yup, Musk might need to sell off everything other than SpaceEx”

            Only in your imagination. Same was said about Apple, Steve Jobs and his Macintosh. Where are Nokia and Windows Mobile now?

          • 0 avatar
            Big Al from Oz

            Inside Looking Out,
            Nokia are where Tesla will be in a few years.

          • 0 avatar
            Asdf

            Tesla and Nokia cannot be compared. Nokia was a market leader in the consumer mobile handset market for many years, whereas Tesla is and has been a tax payer-sponsored joke since its inception (despite its tiny, but vocal following of brain-washed greenies).

          • 0 avatar
            mcs

            Big Al: “even GM is further advanced than Tesla ”

            I’m not so sure about that. As an EV owner, in my opinion, Tesla’s Supercharger Network gives them a huge advantage other the others. No one else has quite figured out how to build a charging network. I looked at listings for several Chevy dealer CCS chargers and you see things like “charger Locked, see staff to unlock” and “open dealer hours”. I don’t want to deal with that crap.

            I’m considering one of the European EVs over Tesla, but that’s only because I don’t think I’ll ever need public quick charging. Charging at home only will work for me with a 300-mile range car and aircraft fractional ownership.

            Even then, I have my doubts and could end up with a couple of Teslas instead. The Roadster is tempting too.

            Also, I’m not into EVs because of the whole green thing or saving money. I just like driving them. I prefer it to ICE V12s and V8s. Don’t give a damn about the politics one way or another, I just want to drive what I want to drive.

        • 0 avatar
          Asdf

          @civicjohn: It won’t be a win for the German auto industry, that’s for sure. Or for consumers wanting to buy something not made in China.

          • 0 avatar
            ect

            Asdf, 10% is hardly a controlling interest, particularly when almost all the remaining shares are owned by long-term investors friendly to management. IIRC, the public float of Daimler shares is quite small. And now smaller.

            So Geely won’t be running the business any time soon.

            In any event, I suspect that very few people have any idea where Volvos are manufactured. In fact, I doubt that very many people know where ANY car is assembled, or where the parts to assemble it come from.

            And (apart from you, apparently) I suspect that almost nobody cares where a car is made, only that it works for them.

            When I was a kid, “Made in Japan” was assumed to mean cheap and shoddy. That changed, in not very many years. The same trend is in place for “Made in China”.

          • 0 avatar
            ToddAtlasF1

            The public float of Daimler shares is 1.03 billion out of 1.07 billion shares. What would a large public float look like?

            http://quotes.wsj.com/XE/DAI

      • 0 avatar
        civicjohn

        asdf,

        Nobody saw something like this coming? What a nice paved road into China for MB, and should probably put a few Tesla fans wondering where they stand with the Chinese government.

        I think this is a win for both and will put some serious pressure on Tesla, while Mr. Musk has in the past “tweeted” his intentions with China, he may be better served with “partnerships”.

        No, Tesla dudes, this is not click-bait, but you may have been outflanked.

      • 0 avatar
        Brian E

        Almost everything Asdf said was incorrect or misleading. The plant that was closed in Sweden was a joint venture with Pininfarina that produced only the C70, which is no longer being produced. The S90 is still produced in Sweden. The S90L was never produced there and Volvo decided to switch the US to receiving the LWB model, so we no longer receive standard S90s from Torslanda. Volvo has also built a new plant in South Carolina which will export the new S60 worldwide, and they’re already investing even more to build the next generation XC90 as well. Ghent is gearing up now to produce the new XC40 and V60. Their stated goal is to produce vehicles closest to where they are being sold, which includes European and US production.

        Volvo R&D continues in Sweden and in fact Geely opened a brand new R&D center in Gothenburg for their own vehicles called CEVT, which includes a remote office in Trollhättan for former Saab employees.

        By all accounts Geely has been a much better steward and benefactor for Volvo than Ford was. I’m sure the end of C70 production was hard for some people but it’s hard to argue that Volvo needed to invest in another specialty convertible in the middle of a major crisis for the company. The alternative they faced was extinction and instead they’re growing in multiple markets and even preparing to return to being a public company. All the fear sounds just like the “Japan Inc” hysteria of the 80s and will seem just as ill-motivated in retrospect.

        • 0 avatar
          Brian E

          As for Nokia, a Chinese investor (Foxconn) bought the brand and the factories from Microsoft, opened up a new R&D center in Finland, and is in the middle of a major market resurgence with attractive devices like the new Nokia 8. In other words, Chinese investors bailed out a storied Scandinavian brand ruined by short-term-focused Americans, invested wisely in local R&D, and have been rewarded handsomely. Sound familiar?

        • 0 avatar
          addm

          Thanks for clearing it. So many people here post a lie and then starts their propaganda based on that lie.
          This site itself has become more of an anti EV and anti selfdriving propaganda site.

          • 0 avatar
            Sub-600

            Why wouldn’t it be an anti self-driving site? Not too many people who enjoy cars and driving are thrilled about auto-pods. What difference will it make if you’re in a Porsche auto-pod or a Kia auto-pod? The power and driving dynamics of your Auto-Pod LTZ (with auto-pod appearance group) won’t matter, you’ll just sit like a bump on a log and go where it takes you. Until the range issue is seriously addressed, EVs will remain appliances that you can’t push because you’ll drain your batteries. Who wants to go flat out on the back roads if you’ll have to sit for an hour playing Candy Crush while your car charges? I, for one, don’t want Captain Planet and his Climate Believers dictating what I drive. Yeah, we get it, you care. Wonderful. Gaia is pleased. Good grief.

        • 0 avatar
          Asdf

          @Brian E: Nice try, but no. The plant that was closed used to be a joint venture, that’s true, but it was owned by Volvo and not jointly with Pininfarina by the time it was closed by Geely. But your fixation on the importance of that single plant doesn’t help you to cover up the main point, which is that since Geely took over, it has built three new plants in China, while reducing the number of plants in Sweden. If Geely had any long-term ambitions for Volvo in Sweden, what would have happened is that Geely would have opened new Swedish plants instead of (or at least in addition to) three plants in China. That hasn’t happened.

          The S90 is no longer built in Sweden according to Automotive News [1], and according to Hakan Samuelsson, President and CEO of Volvo Car Group, a third of Volvo’s target global production of 800,000 units annually will be sourced from one of three Chinese plants [2]. One has to be actively obtuse not to understand that one in three eventually means two in three and finally three in three (unless one counts the Chinese-made CKDs sent to South Carolina as “Made in America”, which would be unreasonable).

          As for the rest of your misleading assertions, that’s already covered by what I pointed out earlier, namely that people have been fooled because Geely is taking things slowly and not moving everything to China on day 1. Of course Geely wants to extract as much know-how and R&D as possible from the Swedes before moving everything to China, hence the interim R&D investment in Sweden (which is of course not publicly described as “interim”, but again one has to be actively obtuse not to understand what is going on). I’m sure Geely learned something from the MG-Rover (Roewe) fiasco.

          [1] http://www.autonews.com/article/20170531/COPY01/305319973/volvo-begins-exports-to-europe-of-china-built-s90-flagship
          [2] http://www.independent.co.uk/news/business/news/volvo-s90-geely-holding-group-made-in-china-a7393771.html

          • 0 avatar
            Brian E

            @Asdf

            I’m sorry, you are correct that S90 production moved out, as Automotive News put it, “to free capacity in the Torslanda factory to keep up with demand for the XC90 and V90 and for expected high demand for the new-generation XC60”. I was mistaken, but your own sources go against your implication that they are winding down Swedish production. Volvo took ownership of the Pininfarina JV back in order to shut it down, because they did not plan on continuing C70 production. That doesn’t change anything.

            I see no source reporting that the Charleston plant will be assembling CKDs. Wards reports that 40% of the parts content will be supplied from North America when the plant opens, and there’s a set aside area for a supplier park which will increase that percentage over time: http://wardsauto.com/industry/volvo-fuels-global-ambitions-us-factory

            The rest of what you wrote starts with the conclusion that they’re planning on abandoning Sweden. Your assumption is that if they’re not building new plants now they must be planning on closing the existing ones. Of course they plan to supply a large part of their global volume from China, because they are growing Chinese consumption as well and plan to build where they sell.

          • 0 avatar
            Brian E

            What’s that you say about Volvo not investing in Sweden under Geely?

            “Volvo Cars today opens its new 24,000 square metres manufacturing facility in Torslanda, Gothenburg, increasing its manufacturing capacity from approximately 200,000 cars a year to approximately 300,000 a year”: https://www.media.volvocars.com/global/en-gb/media/pressreleases/145369/volvo-cars-new-plant-in-torslanda-increases-manufacturing-capacity-from-200000-to-300000-cars-a-year

            “The third shift in Volvo Cars’ Torslanda plant started today, creating nearly 1,500 new jobs in the company’s Western Swedish home region”: https://www.media.volvocars.com/global/en-gb/media/pressreleases/162376/volvo-cars-torslanda-plant-starts-up-a-third-production-shift-with-nearly-1500-new-employees

            The plant they closed in Uddevalla employed 600 workers, so that’s still a net growth in Swedish manufacturing jobs: https://www.thelocal.se/20111003/36518

          • 0 avatar
            Asdf

            2014: Geely needs more capacity for its Volvo cars – expands its existing plant in Sweden.
            2017: Geely needs more capacity for its Volvo cars – moves production to China.

            That development tells a story. Not everyone wants to digest its implications, but the end result of Chinese ownership has been obvious since day one. As I said above, people have been fooled because Geely is taking things slowly and not moving everything to China on day 1.

            But I have to give credit where it’s due. Politicians, for instance, often voraciously deny that something is going to happen (e.g. as a result of their policies). At some point, as if their denials never happened, they suddenly say that the issue in question is indeed going to happen, only now it’s not considered a bad thing. Big Al from Oz is at that second step, and is thus a step ahead of the rest. Methinks he must be a politician. I’m counting down the days until you yourself reach that step.

          • 0 avatar
            Brian E

            @Asdf

            I admitted my error on S90 production because it was a mistake. The fact remains that regardless of model production shifts, under Geely’s ownership Volvo has increased output and manufacturing jobs in Sweden.

            You allowed your statement that Volvo is assembling CKDs from China in Charleston to stand because it is a lie. I will let the reader be the judge of the motivation behind your words.

          • 0 avatar
            Asdf

            You’re right, I didn’t address the CKD point, which you conveniently bring up seemingly to deflect the point I *did* make, which you ignored, instead choosing to cast doubt about my motivation (!).

            (As it stands, the US plant is not yet operative. When it is, we’ll see who’s right. I have no problem conceding that the vehicles assembled there won’t be from CKDs, should that turn out to be the case. In any case there’s a significant probability that the vehicles will nevertheless be chock full of Chinese parts. Don’t forget that even the “Swedish” XC90 had Chinese-made front suspension parts only a few years ago. But nobody advertised that fact…)

            You write that “under Geely’s ownership Volvo has increased output and manufacturing jobs in Sweden”, but you forget to add the words “so far”. This trend is not likely to continue, on the contrary it’s likely to be reversed, and Geely’s decision to move production from Sweden to China is a clear indication that the tide has turned. To those who want to see, that is.

          • 0 avatar
            dal20402

            Your conspiracy theory is silly. Geely may be focused on Chinese expansion, as is only logical given where the growth in auto sales is, but it’s not going to throw away some of the best auto industry workforces in the world (in either Sweden or Germany) just to achieve some sort of all-Chinese purity.

          • 0 avatar
            Asdf

            It’s not a conspiracy theory, it’s just common sense. As for your straw man about “some sort of all-Chinese purity”, that misses the mark, as a move to China will be about a) bringing the costs down, and b) strengthening the Chinese auto industry.

  • avatar
    buckeyemtb

    Steph, Chinese names are structured opposite from Western ones, with the family name first. So for Li Shufu, it’s proper to refer to him as Like throughout your article, rather than the familiar Shufu. The way you have it now is like saying Bill Gates bought a bunch of shares, and then Bill did this and Bill did that. Normally you’d say “Gates did this” and “Gates is in it for the long haul”. Hope that helps!

  • avatar
    Jeff S

    There are two sides to Daimler being eventually owned by Geely. One side is that the good paying jobs in Germany could eventually go away with most of the manufacturing done in China. At the same time if Geely does eventually get a controlling interest in Daimler they probably will follow a similar path as they have with Volvo by not making any immediate major changes. The other side of the argument is that China is now the major market for growth in new vehicle sales and Geely gives them a huge opportunity for sales growth in China. With over 300 million Chinese now middle class and upper class this is a huge market. With the increased use of robots labor costs will become less a determining factor of where to produce vehicles and shipping costs and ability to react to shifts in demand will become more critical. I don’t see all the manufacturing jobs going to China especially when more robots are and will be used. Chinese labor is starting to demand higher wages and benefits which will make China not as attractive labor wise. Nothing ever stays the same and we could eventually see more manufacturing jobs come back to the US but with less labor (less lower skilled labor) but demand for higher skilled labor to operate and repair the robots. Even China will increase the use of robotics in manufacturing as well.

  • avatar
    el scotto

    Three Things:
    1. 10% is not a majority ownership. If Geely would get close to majority ownership (or some such predetermined number); I imagine the Germans would say that Daimler was a “vital national asset” or such and pass laws forbidden Geely to own it/do a takeover. Yeah, “Germany” and “National” don’t make a pleasant sentence for many.
    2. Many people drive EVs/Hybrids because they like them. EV instant torque and low maintenance is sweet. (Anecdotal Evidence) My boss ‘wife got 300000 miles on her Prius. She got another Prius; he traded his Escalade (many electrical problems)for a Velosoter commuter beast and they have a Dodge Cummins for hauling the boat/weekend play duty. She’s a nurse, he’s a electrical engineer. So NO, “virtual signalling” or whatever the right wing wingnuts (snowflakes?) wanna call it doesn’t come into play.
    3. For all the Nuvolairi/Vukovitch types out there; please tell us where these low density drivers roads are. I drive on South Capital street in Washington D.C. and it is truly 3rd world quality. For D.C. commuters taking I-95/295/395 traffic is usually not fun. Not a bit. When I lived in Alexandria VA there were Fridays where it took me an hour and half (90 minutes in Buick time) to go nine miles. A bicycle would’ve been faster. An hour and a half to go nine miles; that’s why many of us don’t drive stick and look forward to self-driving pods. MMMKay?

    • 0 avatar
      kosmo

      1. Doesn’t matter if it’s a majority ownership. It matters how it compares to other significant owners. Are there several other stock owners at the 15% or greater level? Then Geely is nearly inconsequential. If 10% is the biggest single block of ownership, then Geely has a LOT of say. SEC considers 5% ownership of a public company significant.

      2. Fair points.

      3. If you think DC regional roads are “3rd world quality” and that low density regions don’t exist you need to get outside your little bubble.

      4. Since your wrote your comment in a way seeking to annoy, rather than logically convince, I’ll do the same: It’s “forbidding” not “forbidden”, “Veloster” not “Velosoter”, “an electrical engineer” not “a electrical engineer”, and “virtue signalling” not virtual signalling.

      MMMKay?!


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