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October 18 2021 5:59 PM ˚

Between Shufu and Musk

Geely Automotive Group Li owner Shufu, Prime Minister Li Keqiang and President of the European Council Charles Michel.
Chinese billionaire and owner of Geely Automotive Group Li Shufu, meets with Chinese Prime Minister Li Keqiang and President of the European Council Charles Michel. (Photo: Volvo media)
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The corridors of the global auto industry are witnessing an escalating debate about the great transformations witnessed by this ever-changing and fast-moving industry. The scene was recently led by Chinese billionaire Li Shufu, the founder and owner of Chinese Geely Automotive Group, years after his company acquired the prestigious Swedish company Volvo, followed shortly by the acquisition of the British sports car brand Lotus. اضافة اعلان

Shufu surprised the automotive world a while ago with his huge and previously unannounced investment of $10 billion in the German Daimler Group that owns the Mercedes-Benz brand, becoming the largest individual shareholder in the most famous German brand that tops the sales of luxury cars globally.

According to the details of the acquisition story, Mr Shufu previously contacted Daimler's top management and offered them a strategic partnership with Geely, which the Germans politely refused, and told the Chinese billionaire that if he wanted to invest in their group, he should simply buy shares from the financial market, which is exactly what he did. He quietly and without noise purchased the largest stake in Daimler, imposing himself as a member of the board of directors with voting power over the group's decisions, which means that the coming days will witness successive developments, of which the hero will be this ambitious Chinese billionaire.

Not only did Shufu attack the "castles" of the German car industry and win the lion's share in one of the most important of these castles, but according to news reports, he headed to Italy, making an offer of $22 billion to acquire the FCA group Fiat Chrysler. But his generous offer did not meet the ambitions of the Italians, deeming the offer below the value of their group, which postponed the execution of the Shufu plan to become the key player in the global auto industry, leaving us to wait for the next move by the most powerful Chinese player in the field.

Shufu had previously stated that he does not see in the future of the global auto industry more than three giant groups, due to the necessity of conglomeration and mergers to survive and reduce costs and the difficulties of supplying the different markets around the world, and it seems that this vision is what prompted Shufu to move quickly in creating an umbrella of a large global alliance to ensure his group’s survival and continuation in the future.

Shufu may have tried to snatch the spotlight, albeit temporarily, from the rising star in the auto industry, "pioneer" Elon Musk, founder of Tesla Electric Vehicles company, and owner of SpaceX.

Musk recently took advantage of his space company's success in launching a satellite carrier rocket, which carried a Tesla Roadster car into outer space, in a highly intelligent media movement that has achieved wide responses around the world. At the same time, Tesla began achieving strong sales results, with increasing demand for its Tesla Model 3 around the world and an anticipated introduction of the Cybertruck, which will bring the rising American company the volume sales that will put it on the map of the global auto industry, despite the fact that Tesla struggles to adapt to large-scale production and repeatedly suffers delays in delivery and production problems that indicate a lack of experience.

Despite all of this, Tesla’s is a resounding success story, and is one well worth studying.

It is expected that the coming days will not be easy for Tesla, as car manufacturers began offering electric cars that compete with Tesla models, the first of which was the E-Pace model from British Jaguar, followed by the Audi e-tron and Mercedes EQC, among others. All major automaker will launch their electric models in various categories over the next few months, which will make Tesla lose its edge as one of very few electric options, and now it must prove its worth against the real competition.

Between Shufu and Musk, the auto industry is heading towards a future full of surprises and successive developments.

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