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(China is going to eat everybody’s lunch): China's Geely makes $9 billion Daimler bet against tech 'invaders'

China's Geely makes $9 billion Daimler bet against tech 'invaders'

Chinese carmaker Geely [GEELY.UL] has built up an almost 10 percent stake in Daimler in a $9 billion bet by its chairman that he can access the Mercedes-Benz owner's technology in the growing battle for the future of automotives.

The purchase by Li Shufu, Geely's founder and main owner, means China's largest privately-owned automaker is now the biggest shareholder in Germany's Daimler.

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"No current car industry player is likely to win this battle against the invaders from outside without friends. To achieve and assert technological leadership, one has to adapt a new way of thinking in terms of sharing and combining strength. My investment in Daimler reflects this vision," Li said.

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The Chinese firm plans to use the meetings to underline that it intends to be a supportive long-term investor, they said.

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German state secretary at the economy ministry, Matthias Machnig, said separately that EU trade ministers meeting next week in Sofia would discuss how better to protect strategically important European companies from unwanted investors.

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Zhejiang Geely Holding owns Volvo Cars, LEVC, the maker of London's black cabs, and last year took a majority stake in sports car maker Lotus, a 49.9 percent stake in Malaysian automaker Proton, a $3.3 billion stake in Volvo Trucks and control of flying car start-up Terrafugia.

http://www.reuters.com/article/us-daimler-geely-stake/chinas-geely-makes...

Just snother BRICS in the wall.

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Pluto's Republic's picture

The entire West is blinded by their own projections. The West would dearly love to own China as a colony and lash all one billion of them to the yoke and crack the whip all day and all night.

I don't think China has fully wrapped their minds around the fact that the West thinks like that. They were never adventurers. They never left China to go conquering. They had the largest navy in the world at one time, and threw it away. "We have everything we will ever need right here in the Middle Kingdom," they reasoned. And so it was for ten thousand years.

The West cannot wrap their minds around the fact that a strong country would think thoughts like that.

China wants to be partners with many countries. They want to build the planet into a utopia. Hard to imagine, I know.

Maybe we should nuke them anyway, just to be on the safe side.

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Amanda Matthews's picture

@Pluto's Republic @Pluto's Republic @Pluto's Republic

and South Africa. They have every intention of becoming one of the world’s economic powerhouses knocking the West off its perch. It’s investing to have access to technology for its own enrichmentt. China and those other nations in their emerging economic association have no intention of sharing the catbird seat with the Western nations that have kept a stranglehold on international trade and finance for so long.

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I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks

Politics is the entertainment branch of industry. - Frank Zappa

Pluto's Republic's picture

@Amanda Matthews

China has partners in Pakistan, Russia, Afghanistan, and Iran, and many African nations as well as Australia and New Zealand. They are partners with Saudi Arabia, Canada and Mexico.

So many articles these days are written with a tone that suggests that the US must do something to stop China. We must send every battle fleet to Asia to defend US interests. We must build more nuclear weapons pointed at China. They stole something that belongs to us. And, now they are printing their own money to use for oil purchases. That's an act of war. The Chinese are coming for our wimmens when they are done drinking our milkshakes.

This dying empire is determined to crush China and Russia so the US can remain the sole superpower in the world. Right now, US propaganda is being stuffed into Americans in order to build red hot hatred and fear. I do what I can to neutralize it.

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Amanda Matthews's picture

@Pluto's Republic @Pluto's Republic

anything about nuking anyone? Besides you, that is. Going to take our Wimmins? That sounds a little ‘’strange’. Where are you getting all this crap? Not in anything I posted.

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I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks

Politics is the entertainment branch of industry. - Frank Zappa

lotlizard's picture

@Amanda Matthews  
within which he feels it’s an informed person’s duty to push back against part of the political elite’s media drumbeat of “anti-Sinitism” / Sinophobia.

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Amanda Matthews's picture

@lotlizard

I put up for discussion didn’t say anything about nukes or stealing wimmin or anything else inflammatory. The subject was a Chinese firm investing in Western companies to acquire its technology where their attempts to develop it has basically failed. (The same way Japan took over the electronics market.) If it was snark, It needed a tag because I totally missed it. Especially the ‘wimmins’ part.

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I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks

Politics is the entertainment branch of industry. - Frank Zappa

k9disc's picture

They are not empire builders. They prefer harmony with the rest of the choir, not silence for the solo, like Americans.

Then you mentioned their aggressive business practices. Pluto granted them and then went further into the American hyper-competitive fear construct: "China wants to rape and pillage America. They will even take our women."

Reminds me of the SouthPark "Jobs" conversation; if you've seen that.

@Amanda Matthews

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“Tactics without strategy is the noise before defeat.” ~ Sun Tzu

Amanda Matthews's picture

@k9disc

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I'm tired of this back-slapping "Isn't humanity neat?" bullshit. We're a virus with shoes, okay? That's all we are. - Bill Hicks

Politics is the entertainment branch of industry. - Frank Zappa

CB's picture

@Amanda Matthews
The Chinese do not want to "steal" the 'tech'. They are already one the world's most advanced countries in that tech.

China considers tech center for alternative energy vehicles

Jan. 22, 2018 (UPI) -- The Chinese government said Monday it would take a world leadership position in alternative vehicles with the establishment of a new technology center.

China is the second-largest economy in the world and, for eight years running, the largest car market in the world. Beijing's air pollution levels, meanwhile, have raised public health concerns.

The Chinese Ministry of Science and Technology called Monday for the establishment a new technology and innovation center for new energy vehicles. The official Xinhua News Agency said the goal of a new center should be stimulating the technology needed to keep up with demand.

China has plans to make electric vehicles mandatory in many of their massive new cities in the very near future. They have already set quotas on foreign auto manufacturers in China such as Ford and GM to produce more electric vehicles.

China Hastens the World Toward an Electric-Car Future

SHENZHEN, China — There is a powerful reason that automakers worldwide are speeding up their efforts to develop electric vehicles — and that reason is China.

Propelled by vast amounts of government money and visions of dominating next-generation technologies, China has become the world’s biggest supporter of electric cars. That is forcing automakers from Detroit to Yokohama and Seoul to Stuttgart to pick up the pace of transformation or risk being left behind in the world’s largest car market.
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From your link:

“No current car industry player is likely to win this battle against the invaders from outside without friends. To achieve and assert technological leadership, one has to adapt a new way of thinking in terms of sharing and combining strength. My investment in Daimler reflects this vision,” Li said.

The Chinese feel they could speed up innovation by sharing knowledge in exchange for market penetration. Unlike America's winner-take-all vulture capitalism, China functions on a win-win model of capitalism (as proven with their rapid rise and expansion). This investment will be beneficial to BOTH parties. Daimler would gain prime access to the world's largest and fastest growing market for alternative fueled vehicles.

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CB's picture

@Pluto's Republic
an inordinately large portion of the world's smorgasbord. The US and EU have been pigging out for well over half a millennium at the expense of other nations on the globe we all share.

America has had a long history of biased import/export controls that have worked to unfairly enrich the country. At the turn of this century, the US was given an opportunity for Chinese partnership and investment to balance the accruing trade deficit. These overtures were not only turned down but protectionist hurdles were put in place to prevent it from occurring. It was tantamount to a slap-in-the-face - the Chinese were basically told to mind their place in the world.

The Chinese finally realized the US is not interested in any win-win trading situation with foreign nations they cannot militarily and financially control. So the Chinese are now by-passing the US and constructing a multi-polar (edited) world based on win-win trade and they are winning big time.

US hubris as the world's financial and military hegemon is coming back to haunt them. Their response to losing world financial control is to increase their military might. But this response will weigh like a huge albatross around their neck and only serve to quicken the demise of the empire as has been proved in ages past.

Fortunately there are two powerful nations that are poised to minimize the destruction when the behemoth finally falters and goes tits up - China and Russia along with the help of the unaligned nations.

10 Lessons For Modern Society From The Fall Of Ancient Rome

Every empire falls. There’s no way to stop it. The only we thing can control is how it happens—whether it’ll be a quiet, dignified passing of a torch or the flaming destruction of a nation torn down by barbarians.

That’s more or less what happened to Rome, and the aftermath was pure chaos. The fall of their empire sent the European world spiraling into a dark age that took centuries to escape.

If we take them time to learn from their history, we’ll see some eerie parallels with our own. And if history really does repeat itself, we’ll get a pretty good idea of what’s to come next.
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It took 1,000 years, though, for Rome to die. It wasn’t over the second they stopped being the world’s biggest superpower. They lingered on for centuries. Their quality of life slowly changed, and most of their people were probably unaware that they were living through the fall of an empire.

Odds are, the same thing will happen to us. We won’t go out in a big explosion. We’ll just slowly start fighting wars we can’t win and struggling with an economy we can’t handle. And slowly, we’ll become nothing more than a chapter in a history book.

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Pluto's Republic's picture

@CB

As to the rise of China, It was pretty clear that the US didn't want to partner with China, they wanted to profit from China. Two trade boycotts come to mind. We wouldn't license China to use the global GPS system in their own technology development, so they had to figure out how to create their own from scratch and design satellites for coordinates. This left them with a natural cryptography and a somewhat advanced geolocation system.

But, the US didn't learn from this. They denied China the use of Intel chips for their university research labs. So, again China had to create their own high-speed chips from scratch. They did such a good job of it that China now has the fastest supercomputers in the world. It number-crunches at quantum levels 24 hours a day, which has allowed China to leap ahead in a wide array of technologies. It will win the AI race, as a result. And their quantum computers will design even faster super-computeers. Essentially, there's no catching up. China is already engaged in physical teleportation, for godsake. They'll be able to deliver their plastic trinkets much faster Smile

Nice piece on falling Empires, also. A good read for everyone. One of the author's points I think is a bit off. It will not take a long time for empires to fall in today's world. The last great empire fell in a matter of days. Yet Russia recovered much improved in just a decade. In spite of the hardships, the people remained united. For the US with its reserve currency, it will be a matter of hours — 72 at the most will take us beyond the point of no return. I don't think it will disrupt the world. They've been preparing for a long time. US Dollars will still work at home and can be used to repay debt negotiated in Dollars. Some foreign trade might be done with US Dollars, but for trade deficits, the US will have to use a different currency. Printing Dollars out of thin air to pay for them won't work anymore. The US should strive to emulate the steadiness and containment that Russia exhibited when their empire failed. China, too, has been though a number of dynasty changes in the past 5,000 years. They may have some advice.

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CB's picture

@Pluto's Republic
Good Good

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CB's picture

China gets jobs and more new cars to reduce carbon emissions. Daimler gets full access to the world's largest alternate fueled automotive customer base.

BAIC Motor, Daimler AG to Build $1.9 Bln Plant in Mainland China
23:05 25.02.2018

The announcement of the massive planned investment comes after the Chinese carmaker Geely disclosed it had acquired an almost 10-percent stake in Daimler, becoming its largest single stakeholder, and stirring some controversy.

Kristian Rouz – German carmaker Daimler says it’s partnered with the Chinese manufacturer BAIC to open a new production base and assembly facility for Mercedes-Benz automobiles in China. The massive investment comes amidst growing demand for higher-end motor vehicles in Mainland China.

The move also reflects the gradual re-orientation of the Chinese economy toward reliance on domestic demand rather than exports, in line with the central government’s ongoing economic reforms.

The two automakers – Daimler and BAIC – are set to co-invest the $1.9 bln necessary to open the new plant, BAIC said in a statement to the Hong Kong Stock Exchange Sunday. The location of the new production and assembly facility was not disclosed.
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This is the largest investment from Mainland China into an international carmaker ever recorded. Additionally, the 9.7-percent stake makes Geely the largest investor in Daimler AG.

"Daimler knows and appreciates Li Shufu as an especially knowledgeable Chinese entrepreneur with a clear vision for the future, with whom one can constructively discuss the change in the industry," the German automaker said in a statement.
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However, the tightening cooperation between Western automakers and Mainland China appears to be mutually-beneficial. China has become the world’s largest auto market, and the majority of international carmakers have a presence there – through a local partner.

China is set to become the world's largest consumer market in the world by 2025, replacing the US which currently holds this position. The Chinese will then surpass the US GDP within a few years. China held first place in GDP(PPP) starting in 2014. Less than a decade ago, it was estimated that these numbers were to occur around 2050 (if they happened at all). Phenomenal growth, mainly because of the cooperative nature of win-win capitalism.

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