Geely: Creation of a Global Automotive Empire

Li Shufu started Geely as a refrigerator business in 1984, using a small loan from his father. Li went on to acquire a failing Chinese motorcycle manufacturer in the early 1990s. He later formed Geely Auto which started selling its first mainstream cars in 1997. Fast forward to 2021, Zhejiang Geely Holding Group a.k.a. Geely, sold over 2.2 million vehicles in 2021. Li Shufu has built Geely’s global automotive empire essentially over the past 14 years, acquiring stakes in strategic assets and gaining full ownership of companies in disarray, turning them around and creating synergies between them.

Taking Partial or Full Ownership of Existing OEMs

Geely has relentlessly gained full ownership or acquired stakes automotive OEMs or automotive-related assets in difficulty, injecting capital to initiate their transformation. Targets are essentially based in Europe and to a lesser extent in Asia.

Geely’s first major move was its acquisition of Volvo Cars from Ford in 2010 for $1.8B. At the time, the American OEM needed to offload non-strategic assets after a deep recession. Then, Geely and Volvo were of similar size selling around 400k vehicles each. Sales by the Swedish entity reached 700k in 2021.

Three years after this first big step, Geely acquired London Taxi Company, maker of the traditional London cab. The Chinese company renamed it London EV Company (LEVC) and helped it develop a completely new electric cab while preserving the charm of the old version (see…