Geely, the publicly traded automaker that Goldman Sachs Group Inc is backing to the tune of $334 million, is unveiling its first homegrown model specifically designed for Western markets, Bloomberg Markets reported in its February 2010 issue.
The gleaming-white four-door compact, which retails for $11,700 to $17,600 in China, is called the Emgrand, a name made up to conjure grandeur.
To the strains of the company song, willowy models in split-to-the-thigh cheongsams pin bouquets on pudgy Communist Party VIPs. Policemen salute as the first Emgrands leave this plant in the port city of Ningbo through clouds of theatrical smoke. Li, Geelys chairman, already has an international auto business. Since 2006, Geely Automobile has been a 23% shareholder in the company thats the biggest maker of Londons iconic black cabs. In October, Ford named Geely Holding Group Co, Geely Automobiles closely held parent, as the preferred bidder for Volvo. On Dec 23, Ford said the companies had agreed on most terms of the sale, which would be completed in the second quarter.
As Li, 46, answers questions at the factory, a reporter asks whether he wants to emulate Japans Toyota Motor Corp Toyota, the planets No 1 carmaker, lost 437 billion yen ($4.85 billion) in the year that ended on March 31, 2009. Why should I want to be Toyota Li deadpans. Theyre losing billions. If any product illustrates Chinas place in the new economic order, its the automobile. The country has averaged annual 10% increases in gross domestic product since 1978growth that has helped turn a nation of bicyclists into a land of car-craving consumers.
China, with its 1.37 billion people, overtook the US in 2009 to become the worlds largest vehicle market by sales. The government projected that auto sales for the full year would soar 39 percent to more than 13 million vehicles. In November alone, they shot up 96%.
While US manufacturers shrink, China had 117 automakers at the end of 2008, according to the China Association of Automobile Manufacturers. Amid a global recession, the collapse of Detroit and trouble at Toyota, investors are wild about Chinas prospects. Geely, in which a Goldman-managed fund holds bonds and warrants that can be converted into 15% of the company, saw its shares jump 573% on the Hong Kong stock exchange in 2009 through Dec 28. Thats more than 10 times the rise in the benchmark Hang Seng Index.
BYD Co, maker of the worlds first commercially available plug-in hybrid, an electric-powered car with a small gasoline engine for backup, attracted Warren Buffett. He bought a 10% stake for $232 million in September 2008.