The Geely Grand Plan 

Geely started 14 years after Proton. Yet they quietly grew from a typical technology firm from the Far East and started to clone existing products in the market.

They did very well and quite quickly. All, without much attention especially the media from the West.

The stealth growth enabled Geely to come up and openly bid for one of the world’s renown marque for cars and other transportation, which at the time bleeding to death. Despite the infusion of a rescue plan by Ford, Volvo needed a much boost to put its products back in the fighting range with the harsh competition, infusing technology, comfort and energy effecticient on top design, amongst other criteria to nurse back a dying marque and loyal followers gone.

Quietly, Geely transformed Volvo and brought forth two great products XC90 and S90, on top of strengthening the financial position and putting profitability to the global renown Swedish marque.

The 2016 revenue is SEK164b (Swedish Krona) with operational profits recorded at SEK6.6b Swedish Krona, for sales recorded at 534,332 units worldwide.

(SEK1.00 = USD0.125)

In short, Volvo recorded USD 20b in revenue for 2016. Just for size, Volvo global sales pre-Geely (2010) was at 334,000 units.

At the moment, Geely already employing 6,500 engineers and scientists in their research and design facility, which would be risen to 12,000.

Geely quickly learnt everything that Volvo could offer of a company which has been designing and manufacturing premium motorcars since the 1920s. This include the production protocol.

They already have an EEV segment C car on the roads in China, which has a range of 300km.

Volvo is targeting to produce 1 million EEV cars by 2025. Volvo already on the road to realise the Swedish Govt policy that zero death due to traffic by 2020.

Imagine what is in store for Proton, from this point onwards.

Geely as a 49.9% new shareholders of Proton, would provide the necessary capital, be it cash, planet and machinery, relevant technology and benefactor from the Geely experience so far in China and the Volvo experience.

Proton itself required heavy corporate and internal transformation, to move forward. This include the discipline and protocol of the entire eco-system that have been propping Proton to what it is, rightly or wrongly.

The entire vendor program would be transformed as well in this corporate exercise, where it is said that many of the vendors and suppliers are cronies of previous regime and were milking honey supplying below average parts and components.

A transformed model would be tweaked to make the philosophy and strategic intent to have an auto industry remained relevant and self sustaining, especially with infusion of a strategic partner and fresh approach and perspective of doing things.

The much needed shot in the arm by a success story like Geely, equally driven to  continuously grow, innovate and product positioning to a target quite unimaginable to the skeptics.

 

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Published in: on September 3, 2017 at 12:00  Leave a Comment