“Do you know how big Volvo is?” asked Don Leclair, Ford’s chief financial officer. It was 2008 and Leclair was responding to an offer from a little-known Chinese businessman to buy the Swedish automaker, which Ford owned. The businessman, Li Shufu, owned a company with less than half of Volvo’s sales and a flagship model, King Kong, almost unknown outside China. He had to politely show the door to “Glass House,” Ford’s iconic headquarters near Detroit, according to two people at the meeting. Ford’s Leclair did not respond to requests for comment on the episode. Fast forward to 2021, Li Shufu’s company, the Geely Group, is one of the top-selling automakers in the world’s largest automotive market. It controls not just Volvo Cars, but also a handful of global car brands, and has a significant stake in the German giant Daimler, which owns Mercedes-Benz. These names are now part of his plans for an automobile revolution. Geely is preparing Volvo for listing on the Nasdaq stock exchange in Stockholm as a route to the future of transport: where cars are part of an electrified network of mobility services, driving, connecting to each other and – how cell phones – generating a lot of data and new business opportunities. It’s a vision more of Silicon Valley than Detroit, where traditional automakers around the world are chasing another giant – Tesla. Li Shufu and his advisers finally convinced Ford to split from Volvo in 2010 for $1.8 billion. He was the first in a series of deals, leveraging brands such as Lotus, Smart and London Electric Vehicle Company to form a network he calls “a wider circle of friends” across all segments of the industry. Li Shufu sees them as building blocks to help Geely compete in a future where cars are not vehicles but “service providers,” he told Reuters at Geely’s headquarters in Hangzhou, eastern China. In this business model, cars will be available by subscription and will offer services such as making payments. They will update their own software and generate leads just like the mobile operating systems developed by Apple and Google. “We’re trying to create an Android-like automotive ecosystem,” he said. Li Shufu, 58, recently adopted a foreign first name – Eric – because he liked the sound. He came from a remote fishing village in eastern China, across the dirty floor of a factory, to the heart of the world’s auto industry. His subordinates often still call him President Li. This account of his evolution to one of the industry’s most unique leaders is based on interviews with Li Shufu himself, as well as rivals and executives of companies in which Geely has invested. They reveal a nimble opportunist who is making a series of initial gambles – on ventures like flying cars and helicopter taxis – to prepare for the new era of automobiles. In addition to vehicles, Geely has a Danish bank, a startup that is developing vehicle control software technology, and Geespace, a China-based company that was given the green light by Beijing this year to make low-orbit satellites that will be the eyes of autonomous machines. The scale of its investments – spanning Europe, Southeast Asia, China and the United States – is unique among Chinese automakers. Asked about his role, some of Li Shufu’s rivals said his relatively new status in the industry gives Geely a potential advantage. He’s not burdened by a large network of gasoline-related suppliers, for example, said a Toyota engineer, who spoke on condition of anonymity: This makes it easier for him to move to a digital industry. “Among traditional automakers, Geely has the most sophisticated look at the future of mobility,” said Bill Russo, head of consultancy Automobility Ltd in Shanghai and a former Chrysler executive. “They understand that the nature of this model is changing.” But Li Shufu’s ambitions face growing challenges. To realize that vision, executives at several rivals say he needs to improve the perceptions of his own cars. “Geely’s biggest challenge is its name, in part due to its past as a low-end car brand,” said a Honda executive. “How did Geely go from this to becoming an Apple-like brand? And Li Shufu is moving in an increasingly tense global climate. Its strategy of building diversified alliances around the world was made possible in the last 15 years of relative openness to technology sharing and marketing collaboration. Now, the superpower rivalry between the United States and China has led to a fierce trade war, and Washington and its allies are blocking the expansion of China’s leading tech companies. The Chinese businessman was not intimidated and says that his foreign investments are a map of opportunities. “All roads can lead to Rome,” said Li Shufu. “But the question is which is the right road and which road leads to Rome the fastest?” Like many other companies in China, Geely seems eager to follow President Xi Jinping’s pronouncements, who increasingly calls for the need to promote what he calls “common prosperity.” In June, before the 100th anniversary of the Chinese Communist Party, Geely issued a press release announcing the “Geely Common Prosperity Initiative” to help employees in Ningbo City, where the company has several facilities. Li Shufu was a member of some political bodies in China. He has been a member of the Chinese People’s Political Consultative Conference, an important political advisory body. And he was a delegate this March to the National People’s Congress, China’s widely approved parliament.
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