Geely Buys into Largest Daimler Stake
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Geely Automobile Holdings has bought a 9.69% stake in Daimler, making it the single largest shareholder of the maker of Mercedes-Benz. The investment cost around €7.2 billion (about RM34.8 billion) and allowed the Chinese auto giant to surpass the previous largest stakeholder, the Kuwait Investment Authority, which has a 6.8% stake.
Geely has been aggressively expanding via acquisitions, starting with buying Volvo from Ford in 2010, and then The London Taxi Company in 2012, and then almost half of Malaysia’s Proton last year. With these, Geely now has strong footholds in the South East Asian as well as European markets.
As for Daimler, it overtook closest competitor, BMW, in terms of number of unit sales in 2016, thanks to strong sales growth in China—last year, profits leap 24%. Presently, Daimler’s presence in the Chinese market occurs via partnership with BAIC Motors, and they are in the process of upgrading the facilities in China to support electric car production. In other words, the partnership seems to be still moving forward. Although Daimler has told news media that its relationship with BAIC is still solid, Geely surely would want to capitalise on this new relationship with Daimler for its home market.
Geely itself is investing in “new energy” vehicles, from hybrid to all-electric, and has been pulling in decent sales of EV and PHEV models under its own Emgrand marque. Moving forward, automakers will be focusing on electric vehicles, more so in China as local governments are starting to pass strict emission laws. (Whether that’s the solution to many of our mobility and environmental problems is debatable, but that’s for another article—this one.)
Would our own Proton benefit in any way? Some technology transfer would be great, although that’s not always how these acquisitions work. Besides getting Geely’s Boyue SUV (coming soon), we still haven’t had any London Taxi plying our Kuala Lumpur roads, which is what this writer would really love to see.