The Head of Geely Holding Group explains what led him to acquire the quintessential Swedish brand, Volvo Cars, in a bold $1.5bn transaction and how he plans to nurture the European auto maker
Until the fall of 2009, few business leaders or drivers in the mature markets of Europe and North America had ever heard of Geely Holding Group.
But China’s largest privately owned automotive group, which I founded 24 years ago, would soon become a familiar name in the business pages of the world’s leading media.
Our company hit the headlines in October 2009 after being named as the preferred bidder for one of the most famous names in the automotive industry, a premium brand associated with safety, quality, environmental care and modern Scandinavian design: Volvo Cars. We have remained in the public eye ever since, culminating with the recent completion of the acquisition of the Swedish company.
For generations, motorists around the world had associated Volvo Cars with technical innovation, leading Scandinavian design, product integrity, environmental care and the safest vehicles on the market. Put simply, Volvo is a brand you trust. From the moment I entered the auto industry, I had a dream to build a trusted brand like Volvo.
I understood that for Geely to complete an audacious offer to acquire Volvo Cars from Ford Motor, we had to win the hearts and minds of many people in Sweden and elsewhere, for this would represent the largest automotive takeover by a Chinese company.
The ‘trust challenge’ was far more than a public relations exercise; it was central to our bid proposal.
From the moment we were named preferred bidder for Volvo Cars, Geely had to secure the trust and support of every part of the Volvo community. This meant educating a wide range of audiences about our company’s past, its values and culture, its approach to car-making and its ambitions for the future.
We had to demonstrate to employees, unions, suppliers, dealers, politicians, regulators and above all customers, that Geely would be a good guardian of the Volvo brand. We also had to show the value Geely would bring to Volvo over the long term. We had to do all this while respecting our confidential negotiations and undertakings to Ford, which had carefully nurtured the famous Swedish carmaker during its 10 years of ownership.
From the start, this was a difficult and sensitive exercise. Geely was a fast-growing company from a country that had become the world’s largest car market. But we were also relatively unknown outside China, in spite of developing popular cars for motorists at home and abroad.
Li Shufu: ‘We did what Volvo Cars is famous for. We paid attention to detail; we approached the deal with care and integrity; and we adopted a safety-first attitude in what we did and said’ outside China, in spite of developing popular cars for motorists at home and abroad.