Chinese automaker Zhejiang Geely Holding Group (吉利控股集團) plans to use a platform developed with input from Volvo Cars Corp to build new models in Malaysia for its partly owned Proton brand, a strategy that shows how it aims to accelerate its push to become China’s first global auto giant.
The yet-to-be-finalized plans for Proton are just one strand of a Geely project to revamp factories at home and abroad using joint platforms it has been perfecting with Volvo since 2013.
Geely in 2010 bought the Swedish brand for US$1.8 billion — a deal that raised its international profile and sent shockwaves through the global auto trade.
Photo: Reuters
Senior Geely officials and engineers told reporters that a project dubbed compact modular architecture (CMA) would allow them to develop, design and build different types of compact vehicles with similar mechanical layout faster than before — and at a lower cost.
CMA, along with a platform for smaller cars known as B-segment modular architecture (BMA) that Geely plans to introduce for Proton, allow them to harness the Swedish automaker’s technologies and Geely’s capabilities in cost control, supply chain management and local production.
“CMA will be the core of Geely’s future architecture design... We learn technologies and build up talents through developing it,” Geely Automobile Research Institute (吉利汽車研究院) vice president Li Li (李莉) said, confirming the Proton plan during an interview in Ningbo, south of Shanghai.
Li declined to disclose details of general investment, financial targets or a timetable for expansion plans.
The CMA platform in particular would allow Geely and Volvo to design vehicles more quickly and cost-effectively, Li said, providing a technological springboard toward a higher market share at a time when the auto industry must embrace a future featuring electric and autonomous transport.
In its pursuit of global automaker status, Hangzhou-based Geely is holding talks to merge the Volvo Cars business with its Hong Kong-listed Geely Automobile Holdings Ltd (吉利汽車) — worth about US$22 billion by market value, bigger then famed industry names such as Fiat Chrysler Automobile NV and Nissan Motor Co.
As well as the 49.9 percent stake it took in Proton three years ago, Zhejiang Geely Holding Group, led by Taizhou-born billionaire Li Shufu (李書福), also comprises a 9.7 percent stake in Germany’s Daimler AG and a majority stake in British sports car brand Lotus.
While giants from Toyota Motor Corp to Volkswagen AG and General Motors Co have followed a similar shared platform project for their respective brands, Geely’s strategy is a first for a Chinese company.
The automaker plans to develop all its models for the Geely and Lynk & Co brands on CMA or other related product platforms, such as BMA.
It is also developing a new architecture to accelerate the launch of pure-battery electric vehicles with intelligent connectivity functions, said Li, a former Ford engineer.
In addition, Geely wants to shift development of next generations of some popular existing models, like Borui and Emgrand sedans, to those architectures, he said.
It takes about 18 months for Geely to significantly change a CMA-based vehicle, versus 24 to 30 months to do so on a non-CMA-based model.
Using CMA, plant managers can switch production of different models to maintain smooth overall capacity utilization rates at production lines, said Oskar Falk, the Volvo-trained head at Geely and Volvo’s first joint production site in Taizhou.
The plant already exports Volvo Polestar 2 electric sedans to the US and Europe, and is preparing to make Volvo’s first battery-powered electric vehicle, Falk said.
Geely also plans to start exporting China-made Lynk & Co 01 sports utility vehicles to Europe this year.
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