HANGZHOU – Mercedes-Benz’s iconic smart sub-brand now has a new home: Ningbo, Zhejiang Province.
Mercedes-Benz AG, the new independent unit responsible for cars and vans under parent company Daimler AG, and Daimler owner Geely Holding Group announced on January 8 that they have formally established their global joint venture “smart Automobile Co., Ltd.” for the smart brand after receiving the regulatory approvals.
The JV – Zhimada in Chinese – which transliterally means “smart motor,” will be based in Hangzhou Bay in Ningbo, where Geely’s R&D operations is based.
The announcement comes a little over nine months after Daimler AG and Geely announced the formation of a 50:50 JV to own, operate and further develop smart, the pioneer of small urban vehicles, as an all-electric brand.
The total registered capital of the JV will be ¥5.4 billion split equally among the partners, with Mercedes-Benz AG mainly contributing the smart brand asset. The aim of the JV is to transform smart into a leading player in the premium and intelligent electrified vehicles.
The new generation of smart vehicles will be designed by the worldwide Mercedes-Benz Design network and developed by the Geely global engineering network. Future production will be located in China. As part of the vehicle-development program, the smart product portfolio will be extended into the fast-growing B-segment that are in line with smart’s brand positioning with a focus on pure premium electric and connected vehicles. The JV will also be responsible for the international distribution of the locally-produced smarts.
The board of directors of the new JV will be made up of six executives with equal representation from both parties.
Daimler AG board representatives will include Hubertus Troska, Member of the Board of Management of Daimler AG responsible for Greater China, Britta Seeger, Member of the Board of Management of Daimler AG and Mercedes-Benz AG responsible for Marketing & Sales, and Markus Schäfer, Member of the Board of Management of Daimler AG and Mercedes-Benz AG responsible for Group Research and Mercedes-Benz Cars Development.
Geely board representatives will include Li Shufu, Chairman of Geely, An Conghui, president of Geely and CEO of Geely Auto Group, and Daniel (Donghui) Li, Executive Vice President and CFO of Geely.
Industry veteran Tong Xiangbei has been appointed the new global CEO of the JV and will oversee all operations relating to the brand including sales, marketing, R&D, production and aftersales. He has more than two decades of experience in the automotive industry, having worked for global automotive OEMs both in the U.S. and China before joining the JV.
“Having received all necessary regulatory approvals we are now ready to start the joint venture with our partner Geely that has been in preparation for the past several months,” said Ola Källenius, Chairman of the Board of Management of Daimler AG and Mercedes-Benz AG. “The joint venture will bring the next generation of zero-emission smart electric cars to the Chinese and global markets. We look forward to continue our collaboration to bring desirable products and services to customers around the world.”
“The smart brand has a unique value and global influence, it has grown to be a leader in urban mobility,” said Li Shufu. “Geely Holding will fully support the smart brand with its full advantages in R&D, manufacturing, supply chain and other fields into the joint venture and support its development in China and globally. We will work together with Mercedes-Benz to transform the smart brand into a leading player in urban premium, electric and connected vehicles to successfully develop the brand’s global potential.”
Under the JV agreement, a new generation of smart electric models will be assembled at a new purpose-built electric car factory in China with global sales due to begin in 2022. Prior to that time, Daimler will continue to produce the current generation of smart vehicles at its Hambach plant France (smart EQ fortwo) and at Novo Mesto plant in Slovenia (smart EQ forfour).
smart sold 116,781 vehicles in 2019, down 9.3 percent from 2018, due mostly to lifecycle factors, according to data released by Mercedes-Benz on January 9. Sales in China were just under 9,000 units.
Mercedes-Benz delivered 702,088 Mercedes-Benz and smart vehicles in China in 2019, up 4 percent. Mercedes-Benz was the top selling luxury brand in China in 2019, delivering 693,443 vehicles, beating out runner-up BMW by less than 2,500 units and third-place Audi by just under 5,000 units in a tight race among the German premium brand trio.
Geely and Daimler officially launched their premium ride-hailing service – StarRides – in Hangzhou in early December 2019, based on another JV that was formed between Daimler Mobility AG and Geely Technology Group in October 2018.