Daimler is working with Geely to convert its existing established Smart brand into an electric carmaker. They plan to focus and concentrate on the vast market that is China.
The agreement states that the smart cars which belong to the part of next generation cars will be assembled at a unit based in China. Sales for these cars are expected to start from the year of 2022. Just before making the announcement, Daimler mentioned that it would continue to develop Smart cars across the existing plants in France and Slovenia.
Daimler (DDAIF) CEO Dieter Zetsche wrote, that the smallest vehicle produced by the company has huge potential in China and regions beyond China. As per him the right partner is Geely to take advantage of the opportunity.
Daimler and Geely will individually own 50% stake of the global joint venture. The financial terms discussed and agreed upon of the deal were not disclosed. Daimler assured that there would be no manpower reduction due to this agreement and all jobs would be secure.
The smart brand was launched almost two decades ago by Mercedes-Benz owned Daimler. However the cars did not do so well with consumers. Reports indicate that only 130,000 smart cars were sol across the world in the year of 2018. The brand’s focus on urban mobility and electric technology further makes it fruitful to Geely Global as it already owns and operates Volvo. It is also based in the largest market for electric cars across the world.
The government of China has asked carmakers to produce and market electric cars. To further support this the government provides large subsidies and tax benefits. At present, China holds about half of the global electric car sales.
Earlier the company Daimler had announced that it plans to concentrate completely on electric drive Smarts by the year 2020. The company reported that there has been growth by almost double the capacity of the electric smart model.
Some other automakers across the globe, which are currently investing heavily towards research and development of electric cars and new technologies for mobility, are Volkswagen and BMW.