China’s Geely buys $9-billion stake in Germany’s Daimler

By |2018-08-12T16:23:58+00:00February 28th, 2018|

It has been confirmed that Geely Automotive has acquired an estimated $9 billion stake in Daimler. The Chinese automotive giant is now the German firm’s single largest shareholder with 9,69% ownership of the company.

According to Reuters, Shufu was seeking an alliance with Daimler so they could enhance developments on autonomous and electric vehicles. Daimler’s technology would assist in battling rivals like Uber, Google and Tesla in that segment.

The news agency reported Li Shufu as saying, “No current car industry player is likely to win this battle against the invaders from outside without friends. To achieve and assert technological leadership, one has to adapt a new way of thinking in terms of sharing and combining strength. My investment in Daimler reflects this vision.”


Where Chinese partnerships are concerned, Daimler is already partnered up with another major company – BAIC. This joint venture allows the production of vehicles in the country. However, Geely has been chasing Daimler for a collaboration for some time now, specifically for autonomous driving tech and EVs.

At this point, it’s still early to say whether it is just a formal partnership or a collaboration agreement. Just to note, Geely also owns Volvo Cars, which they acquired from Ford in 2010, as well as Lotus.

In a statement by the German automaker, it confirmed that 54-year-old Shufu purchased a total of 103 619 340 shares.

“Daimler is pleased to announce that with Li Shufu it could win another long-term orientated shareholder, which is convinced by Daimler’s innovation strength, the strategy and the future potential.

Daimler knows and appreciates Li Shufu as an especially knowledgeable Chinese entrepreneur with a clear vision for the future, with whom one can constructively discuss the change in the industry.”

Effect on the South African market

South Africans are loyal and traditional car buyers which favour the German brands. We have seen this for many years and it reflects in AutoTrader search statistics. The most searched-for vehicle in 2017 was the BMW 3 Series, followed by the Mercedes-Benz C-Class and then the Volkswagen Golf.

However, given international trends, we could see a shift in buying preferences, with South Africans aspiring to own Chinese vehicles. The fact that Daimler, the world’s most prestigious vehicle manufacturer, now has the chairman of Chinese automaker Geely, as its largest shareholder may start changing perceptions. Although I don’t think that this will happen anytime soon. This scenario is not as far-fetched as some industry commentators may think.

Corporations that dominate the global auto industry

The automotive industry has experienced incredible growth over the last few years.

More brands have appeared and companies are selling everything from tiny economy cars to million-dollar hypercars. However, there’s a lot of consolidation in the industry. Most of the world’s major car brands are owned by a few big companies.

I’ve gathered this to display where the market power lies.  Note, there are several brands left out as the image below is simply to highlight major industry influencers/owners. You’ll notice makes like Ferrari, Tesla, Mazda, and Subaru are not listed as they do not belong to a major manufacturing conglomerate.

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