They’re exploring more synergistic solutions. Or something.
After Geely chairman Li Shufu caught the automotive industry off-guard by buying a $11-billion stake in German automotive conglomerate Daimler (making him the single biggest shareholder), it seems that the Germans may be weighing up their options and looking for ways to improve the cooperation that’s being forced upon the two companies. Both parties stand to benefit from the tie-up, so why not make it more significant?
A report being run in German publication Manager Magazin (doesn’t that sound like a compelling read) said that sources within Daimler have told them that they may seek to buy “a couple of percent” in Geely’s luxury marque Volvo. Further, those sources said that Daimler is willing to consider supplying Geely with “engines,” though that raises some alarms with us.
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It makes sense if the two companies want to start sharing technology. A subsidiary of Geely is the London Electric Vehicle Company, that recently reinvented the London black cab and turned it into a range-extender electric vehicle with a diesel generator. The tie-up between Geely and Daimler was forged with the implicit focus to tackle ride-sharing and next-generation mobility solutions, which is where Daimler could assist Geely by helping to develop a whole mobility system around LEVC and take on companies like Waymo and Uber.
However, this talk of “engines” is suspicious because the two companies have approached internal combustion rather differently: Volvo has developed the scaleable Drive-E engines that are hewn from aluminium, are able to be scaled down from the default 2.0-litre four-cylinder format, and are designed to be able to handle diesel and petrol formats. Mercedes-Benz on the other hand has developed a range of new inline-6 motors, still has interests in V8s, and are generally less concerned about the environment and sustainability (insofar as internal combustion motors are concerned) than the Swedes.
We have a great amount of respect for the engine tech from both companies. But cross-pollination between Daimler and Geely is a bit like garnishing a pan-seared salmon with chips and gravy. It’s not wrong, just… odd.
However, it’s also possible that “engine” doesn’t translate well to German, and Manager Magazin was actually talking about electric motors and electric powertrains, which makes more sense to us. Either way, we have to just wait and see how this plays out. Either way though, Daimler and Geely can’t consummate the marriage until they get approval from Daimler’s Chinese partners BAIC, who may take the role of the jilted ex and throw as many spanners in the works as they can manage. Should be fun.
Stay tuned to CarShowroom as we bring you more updates as they come.
