The name of the man who strives successfully around the world from China may sound a little awkward to Western ears. That’s why Li Shufu gave himself a new one some time ago: He’s now called Eric Li. That fits very well, because the 58-year-old billionaire has just made a remarkable step into the western world – again.
His realm includes Volvo, this popular brand from Sweden, and he will be listing it on the Stockholm Stock Exchange later this year. What a career.
When China was reconnected to the world economy after the end of the Cultural Revolution, Li first tried his hand at photography. He later founded a company that manufactured components for refrigerators. He called her Geely. In Chinese: “auspicious”. Whereby Li has always helped skillfully with professional happiness. When the state began regulating the refrigerator industry in 1989, Li bought an old motorcycle factory and wanted to build cars. A daring plan, because in the 1990s only state-owned companies were allowed to manufacture cars in China. Li made use of a trick. At that time, a car in China was defined like this: at least four wheels and three cylinders. So the Geely company built cars with two-cylinder engines. In 2001, Li finally got a license to build real cars. Which he, well, overstimulated: In the beginning there was a Rolls-Royce clone with a built-in throne.
Four years later, Geely exhibited at the auto show in Frankfurt. The industry laughed. In 2007 he was at the trade fair in Detroit, and people smiled again. With an interpreter he made his way to the Ford booth: “My name is Li Shufu and I come from Geely, a car company in China,” he introduced himself. “I would be interested in buying a Volvo.” At that time the Swedish company was still part of Ford. And nobody in the United States knew this man from China. The Americans politely informed him that Volvo was not for sale. Three years later they changed their minds in view of the miserable situation in Sweden at the time. Geely paid Ford $ 1.8 billion.
As successful as headstrong: Volvo boss Hakan Samuelsson in a photo from 2019.
(Photo: Nicolas Maeterlinck / imago images / Belga)
After that, his company took over LEVC, the manufacturer of London taxis, and invested in Volvo trucks. In 2018, Li personally bought himself for 7.5 billion euros from Daimler: He is now the largest shareholder and after a long struggle, Swabian-Chinese internal combustion engines are now being built or the small Smart as an electric version in a joint venture. After all, there is above all: Volvo. Li made the headstrong Swede Hakan Samuelsson head of Volvo and although or maybe because of it, Volvo has become the heart of Li’s conglomerate. A subsidiary brand with electric sports cars is developed from here. It’s called Polestar and is supposed to go public in New York – accompanied by Samuelsson’s self-assured warning: Without the connection to Volvo, to Sweden, it would not be successful.
Li established the Volvo brand in China soon after the purchase, where it flourished very quickly: People believed that this was Chinese workmanship, it was developed in Sweden and built in China. In any case, the sales figures have picked up since Li from China and Samuelsson from Sweden determine the fate: This year Volvo should sell around 750,000 cars, in the year 2025 it should be 1.2 million. That is less than the direct German competition from BMW, Audi or Mercedes, all of which currently have around two million vehicles. But there is the Geely conglomerate that helps with scaling. And the fresh money: In Sweden and China you are probably assuming that the brand should be worth around 17 billion euros in total. Ten times more than Li once paid Ford.
However, Geely should keep the majority in Volvo in the future, explains Li. And that also explains Samulesson, who says his first goal is to raise around two and a half billion euros on the stock exchange: For software, for research with cells and possibly his own Battery production – Volvo plans to only build electric cars from 2030. One can assume that some of this will be found in the other regions of Li Shufu’s car riches, even though Samuelsson has only just re-emphasized that Volvo will continue to keep an arm’s length distance from all other partners and not strive for changes.
Anyone who has listened carefully to the owner Li in recent years, however, also knows his point of view: He believes that the industry is facing consolidation, that, similar to the providers of smartphones, there will soon only be a few companies that are profitable with their products – and, Li believes, they have to offer an “ecosystem” for users, as Tesla and Apple are doing a little in the west. Mobility and communication from a single source, so to speak – this is complemented by another announcement by the Chinese entrepreneur: the Geely Group has just started building satellites and is also preparing the production of smartphones.