Geely first in line to take over American electric car manufacturer
Geely hoping to add another international acquisition to its arsenal
Private status counts in Geely favour
- Geely has ability to move fast to react to market demand
Chinese car maker Geely is the preferred candidate of only two companies world wide on a short list to partner the promising American electric car manufacturer Fisker, whose executives have just returned from China after a visit over the Chinese New Year period.
Four Chinese companies have reportedly been talking to Fisker, but only the names of Geely and the state-owned Donfeng have been leaked to the media.
According to Chinese media reports Geely seems to be the preferred candidate because of its status as a private company, allowing it to move fast. Donfeng as a state-owned entity is expected to be too slow to react to market demands.
Geely also scores major points as far as foreign mergers and acquisitions are concerned – in 2010 the company surprised the automotive world by becoming the new owner of Swedish car maker Volvo. Geely also bought Manganese Bronze, manufacturer of the renowned London Taxi, as well as the Australian gearbox manufacturer Drivetrain Systems International (DSI) which manufactures a 6-speed automatic transmission now widely used in new Geely models.
Fisker, which manufactures an electrical plug-in sports car called Karma, has been facing a series of challenges such as battery supply problems, cash flow issues and an insurance problem stemming from the loss of 300 cars during Super Storm Sandy.
Two years ago Fisker unveiled its products at the Shanghai Auto Show, and contracted China Grand Automotive to distribute the cars on the Chinese market. Although the company hasn’t sold a single car in China yet, local automotive media were showing keen interest in the luxury range of green energy-efficient cars.
“If Geely is successful, a closer integration can be expected within Geely and Volvo, possibly even European production via an existing Volvo plant,” says Henri Meistre, Managing Director of Geely South Africa. “Geely might wish to use some of the Fisker technology in its own cars, but we don’t expect to see Fisker production in China anytime soon.”
In the meantime Fisker is expected to resume production fairly soon. According to Chinese media reports Henrik Fisker, executive chairman and former chief executive officer, declined to specify a specific date.