Chinese carmakers may soon own a fifth of Daimler

AT DAIMLER’S ANNUAL meeting in May, one shareholder captured the mood. “Don’t replace the Mercedes star with a Chinese dragon,” implored Deka Investment, a big asset manager, referring to the purchase in 2018 by Geely, a Chinese firm which also owns Sweden’s Volvo, of a 9.7% stake in the German car giant. Daimler now faces the rise of a second dragon. Beijing Automotive Group (BAIC) is reportedly poised to double its holding in Daimler to almost 10%. This would put it ahead of Geely as the firm’s biggest shareholder.

If Geely’s manoeuvre was a surprise, BAIC’s is not. In July the state-owned company grabbed 5% of Daimler. Though the dragon is not yet on the bonnet, it has long been under it: engines, powertrains and other parts that go into Daimler’s Mercedes-Benz cars sold in China are made under two joint ventures with BAIC set up since 2005. With Chinese car sales down in 2018 and 2019 after years of steady increases, domestic manufacturers are banking on premium cars for growth. So is Daimler, whose financial performance has been less inspiring than that of its cars. Its share price has nearly halved since 2015.

For BAIC, the relationship with Daimler is “of existential importance”, says Robin Zhu of Bernstein, a research firm. In 2018 sales from Beijing Benz, one of its ventures, grew by 16% year on year and...



via Business Feeds

0 nhận xét:

Post a Comment