Business

Chinese carmaker Geely builds almost 10% stake in Daimler

BEIJING/FRANKFURT Chinese carmaker Geely has built up an almost 10 per cent stake in Daimler in a US$9 billion (S$12 billion) move by its chairman to access the Mercedes-Benz owner's technology in the growing battle for the future of automotives.

The purchase by Mr Li Shufu, Geely founder and main owner, means China's largest privately owned automaker is now the biggest shareholder in Germany's Daimler.

Geely said on Saturday there were no plans yet to raise the stake. It will seek to forge an alliance with Daimler, which is developing electric and self-driving vehicles, to respond to the challenge from new competitors such as Tesla, Google and Uber.

"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," Mr Li said.

Geely officials plan to go to Stuttgart to meet Daimler executives next week and also hope to meet German government officials in Berlin, two sources told Reuters.

The company plans to underline that it intends to be a supportive long-term investor, they said.

Bernstein Research analyst Max Warburton said: "It is not clear what Geely wants and how it is going to work, but we view this move as part of a broader Chinese move to gain involvement in the European automotive industry."

- REUTERS

BUSINESS & FINANCE