China's Geely becomes top shareholder in Mercedes owner Daimler

China's Geely acquires $9 billion stake in Daimler

They might bristle at the Geely relationship, but given their contract to make the Smart ForFour vehicle for Daimler, they are unlikely to ditch their combined stake. The Stuttgart-based carmaker sees the investment as a vote of confidence, spokesman Joerg Howe said by phone.

This makes Zhejiang Geely Holding Group Daimler's largest investor, Bloomberg said. Daimler isn't the only German automaker to have a big anchor investor: Volkswagen AG is essentially controlled by the Porsche-Piech billionaire clan, while also counting the government of Qatar as a major stakeholder.

Dailmer didn't say whether Mr. Li would get a board seat, but said it looked forward to discussing the investment with him. Daimler is working on both electric cars and battery-powered trucks.

Chinese companies have been more active buying into German companies in recent years. In 2010, he acquired Volvo Cars from Ford Motor Co, and previous year won control of British sports-car maker Lotus Cars Ltd.

The investment furthers Hangzhou-based Geely's foray into the European premium automotive market and ends months of speculation about a tie-up. The Chinese firm hasn't showed any signs of slowing down, either.

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Image Zoom

The move marks a further push into Europe for the Chinese carmaker, a market Geely hopes to break into in its own right with its all-electric Lynk & Co brand next year. Li Shufu said that he will fully abide by the company charter and governance structure of Daimler AG and respect its values and culture.

The purchase by Li Shufu means Geely, China's largest privately-owned automaker, is now Daimler's biggest shareholder.

Li Shufu said,"The competitors that technologically challenge the global vehicle industry in the 21st century are not part of the automotive industry today".

"But with challenges come opportunities".

That's backed up by comments made by Li, who appears to believe that the competition the auto industry faces from companies like Tesla, Google and Apple will result in just a handful of current vehicle makers surviving and prospering in this new era of autonomous and AFVs. To achieve and assert technological leadership, one has to adapt a new way of thinking in terms of sharing and combining strength.

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