Daimler and China's Geely join forces to build next-gen Smart car

Mercedes-Benz maker Daimler and Chinese auto giant Geely announced plans Thursday to develop the next generation of electric Smart cars to be made in a joint venture in China.

Under the agreement, expected to be finalized by the end of the year, the new vehicle will go on global sale in 2022, the German and Chinese car giants said in a statement.

The new Smart cars will be styled by the Mercedes-Benz Design network with engineering provided by Geely.

Prior to the launch of the next generation, Daimler will continue to produce the current "fortwo" model of the Smart car at its plant in Hambach, northeastern France.

The Smart car will then leave its historic home in France to be manufactured in China, but Daimler insists no jobs will be lost.

Daimler says 500 million euros (562 million U.S. dollars) will be invested in the Hambach plant, which will assume "an additional role" producing a compact electric vehicle under the new "EQ" product brand.

Geely is owned by Chinese billionaire Li Shufu, who is also Daimler's main shareholder having acquired nearly 10 percent in the German manufacturer in February 2018.

Founded in 1986, Geely was originally a low-cost home appliance manufacturer before founder and boss Li transformed it into an auto group in the late 1990s, becoming one of China's leading private manufacturers.

The group paid 1.5 billion U.S. dollars to buy Volvo Cars in 2010. The following year, Geely invested 11 billion U.S. dollars in Volvo to launch a new line of cars, which saw the brand take off in China.

Last week, Geely reported worldwide sales of 2.15 million vehicles (up 18.3 percent year-on-year) and announced a net profit for 2018 of 1.66 billion euros (up 18 percent on 2017) on a turnover of 14.1 billion euros (up 15 percent).

Daimler can boast similar sales figures, with Mercedes Benz shifting 2.4 million vehicles in 2018, including 130,000 Smart cars in 40 markets worldwide.

The German group's net profits last year were 7.6 billion euros (8.5 billion U.S. dollars), down 30 percent on 2017, with sales of 167 billion euros (187 billion U.S. dollars), up two percent.

Following the 2013 acquisition of British taxi manufacturer, 'The London Taxi Company', Geely made a burst of investments in 2017 to strengthen itself, particularly in Europe.

It snapped up iconic English sports car Lotus and American start-up Terrafugia, designer of futuristic flying cars, while Geely also became the largest shareholder in the Volvo group with a reported investment of 3.25 billion euros (3.65 billion U.S. dollars).

(CGTN)