China to the Rescue: Geely Steps In to Save the Smart Brand

Steph Willems
by Steph Willems
china to the rescue geely steps in to save the smart brand

Contrary to past media reports, the Smart brand will not join the likes of Plymouth, Scion, and Pontiac in the great automotive graveyard. If that’s a good thing in your books, send a note of thanks to China’s Geely Holding, savior of Volvo and Lotus.

On Thursday, Smart parent company Daimler and Geely announced a 50:50 joint venture to develop and build a new generation of global-market Smart models in China.

It’s good news for fans of the brand’s diminutive city cars, the existence of which was threatened by declining sales, financial losses, and a development partner (Renault) with cold feet. Daimler’s incoming CEO, Ola Källenius, was reportedly prepared to drop Smart like a hot potato in order to stem the red ink.

Smart moved to EQ-badged, electric-only models in North America in 2018, with the rest of the world following for the 2020 model year. The plan was built on shaky financial ground. Electromobility is still in its infancy, the Smart Fortwo’s range didn’t impress, and the cost associated with developing a new range of vehicles without a partner’s help might have been too much for Daimler to stomach.

Geely to the rescue.

“Under the joint venture 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,” the two automakers said in a statement.

Geely knows electrics, and so does its home market. For Daimler, it’s an opportunity to keep the brand alive on the cheap while reducing its emissions footprint in regions that care about that kind of thing.

“We will jointly design and develop the next generation of smart electric cars that combine high-quality production and known safety standards for sale both in China and globally. In the future, we are looking forward to working with all partners to sustain our success in China and worldwide,” said Daimler Chairman Dieter Zetsche in a joint media release.

“Separately, Mercedes-Benz will produce a compact electric vehicle at the [French] Hambach plant, sustaining employment with further investment in the facility.”

Six executives, split evenly between both automakers, will sit on the board of the new joint venture.

Geely Chairman Li Shufu said his company respects the “value of Smart,” adding Geely Holding Chairman, adding, “This brand has a unique appeal and strong commercial value.”

Until new Smarts begin rolling out of China, Daimler plans to continue production of existing models at its two European plants. The automakers noted that Mercedes-Benz will handle the next-gen Smart’s design while Geely handles the engineering. A move up in size is planned, too. The companies said a B-segment Smart will accompany the new electrics.

[Image: Daimler AG]

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  • Inside Looking Out Inside Looking Out on Mar 28, 2019

    Now how about other zombie brand SAAB? And why China did not rescue Scion and Saturn?

  • HotPotato HotPotato on Mar 30, 2019

    An electric Smart makes a cheeky personal transport pod, but they've got to about double the range without changing the price, and that's not going to be easy.

  • Art Vandelay Best? PCH from Ventura to somewhere near Lompoc. Most Famous? Route Irish
  • GT Ross The black wheel fad cannot die soon enough for me.
  • Brett Woods My 4-Runner had a manual with the 4-cylinder. It was acceptable but not really fun. I have thought before that auto with a six cylinder would have been smoother, more comfortable, and need less maintenance. Ditto my 4 banger manual Japanese pick-up. Nowhere near as nice as a GM with auto and six cylinders that I tried a bit later. Drove with a U.S. buddy who got one of the first C8s. He said he didn't even consider a manual. There was an article about how fewer than ten percent of buyers optioned a manual in the U.S. when they were available. Visited my English cousin who lived in a hilly suburb and she had a manual Range Rover and said she never even considered an automatic. That's culture for you.  Miata, Boxster, Mustang, Corvette and Camaro; I only want manual but I can see both sides of the argument for a Mustang, Camaro or Challenger. Once you get past a certain size and weight, cruising with automatic is a better dynamic. A dual clutch automatic is smoother, faster, probably more reliable, and still allows you to select and hold a gear. When you get these vehicles with a high performance envelope, dual-clutch automatic is what brings home the numbers. 
  • ToolGuy 2019 had better comments than 2023 😉
  • Inside Looking Out In June 1973, Leonid Brezhnev arrived in Washington for his second summit meeting with President Richard Nixon. Knowing of the Soviet leader’s fondness for luxury automobiles, Nixon gave him a shiny Lincoln Continental. Brezhnev was delighted with the present and insisted on taking a spin around Camp David, speeding through turns while the president nervously asked him to slow down.