Daimler and Geely executives celebrate the signing of their new deal.
Just as Daimler AG’s Smart division appeared to be on the outs with the support of Ola Kallenius, the incoming chairman and CEO, the company’s largest shareholder, Geely, swooped in and saved the oft-near death quirky brand.
In recent weeks, its been reported – including by TheDetroitBureau.com – when current Daimler CEO Dieter Zetsche retires shortly, the primary supporter of the Smart brand would no longer be around to protect the underwhelming product line and soon-to-be-top-dog Kallenius, who isn’t a fan, was ready to kill the vehicle.
However, the company’s top shareholder, Chinese automaker Geely Motors, which bought a nearly 10% stake last year, jumped in at the last minute to save Smart by forming a new 50-50 joint venture between the two companies to produce the tiny EV in China.
The deal calls for two sides to be equal partners, but production of the Smart EV will be moved to a purpose-built plant in China with the first new vehicles rolling off the line there in 2022.
(Smart looks to be on the chopping block at Daimler — again. Click Here for the story.)
Li Shufu and Dieter Zetsche seal the new deal with a handshake.
“For more than 2.2 million customers, Smart represents a pioneer in urban mobility,” said Dieter Zetsche, chairman of the Board of Management of Daimler AG and Head of Mercedes-Benz Cars, in a statement. “Based on this success story, we look forward to further enhancing the brand with Geely Holding, a strong partner in the electric vehicle segment. We will jointly design and develop the next generation of smart electric cars that combine high-quality production and known safety standards for sale both in China and globally.
“In the future, we are looking forward to working with all partners to sustain our success in China and worldwide. Separately, Mercedes-Benz will produce a compact electric vehicle at the Hambach plant, sustaining employment with further investment in the facility.”
Geely’s Chairman Li Shufu, which also controls Volvo Cars, made news last year when seemingly out of the blue he decided to become Daimler’s largest stockholder. He said at the time he looked forward to working with Daimler on future partnerships. The future is, apparently, now.
“We fully respect the value of smart. This brand has a unique appeal and strong commercial value,” he said. “Geely Holding and Daimler look forward to this challenging and exciting new project, through which we will further push the introduction of premium electric products to give a better mobility experience to our customers.
(Click Here for more about the Smart Vision EQ Concept.)
Smart introduced the next iteration of its forease concept: the forease+ at the Geneva Motor Show this year.
“As equal partners, we are dedicated to promoting the smart brand globally; we will leverage our experience and global competencies in brand management, R&D, manufacturing, supply chain management and other areas. The synergies from this cooperation will lead to mutual benefits, at the same time we will further develop technologies for smart including connectivity, to continue to lead in the industry as it undergoes a wider transformation.”
Smart has often been rumored to be on the outs at Daimler. Last fall Renault, Smart’s current European partner, wanted get out of the deal. The Smart ForTwo and Renault Twingo share a platform. However, the plans to continue the brand as an all-electric car appeared to put a little charge in the support for Smart.
The company introduced a new Smart EV at the most recent Geneva Motor Show earlier this month. The new concept, called the Forease+, was the next step in the evolution of the Forease two-seater convertible show at the Paris Motor Show last fall.
(Smart celebrates 20th anniversary with debut of forease urban concept. Click Here for the story.)
According to CarSalesBase.com, sales of the ForTwo have dropped from a high of 24,622 in its first year in the U.S. in 2008 to just 1,276 last year. In Europe, Smart sold 62,361 FourTwo models last year, and 97,346 vehicles in total.