Internationalization of the Geely Brand
More importantly, Geely has successfully implemented its localization strategy and created authentic local enterprises abroad. More specifically, Geely has achieved localized production through building assembly plants in foreign countries with large market capacities.
At present, Geely has established assembly plants in Russia, Ukraine, Belarus, Egypt, and Uruguay. More than half of its overseas sales are manufactured in these plants.
According to Yang Xueliang, in October 2012 Geely set up a assembly plant in Egypt to produce the Emgrand EC7. Six months later, the sales of cooperative dealerships reached 1,000 cars per month, ranking in the top 10 in the local market. Local dealers are confident Emgrand EC7 will become the “national car” for Egyptians.
Meanwhile, Geely has developed new models based on local market requirements. For example, to accommodate Saudi Arabia’s high temperatures, Geely enlarged the vehicle’s water tank and enhanced air-conditioner capacity. To deal with Russia’s extremely cold climate, Geely improved the windshield wipers and increased car body capacity. To cope with Latin America’s mountainous roads, Geely strengthened the vehicle’s drive performance.
To improve after-sales service, Geely has not only carefully selected its local dealers, but also set up training centers for local staff. Meanwhile, Geely has built more regional logistics centers, which have significantly improved the efficiency of spare and accessory parts supply.
Since Geely built factories overseas, an increasing number of components and parts can be purchased locally, which has also promoted employment. Most employees at Geely’s overseas assembly plants and sales and after-sale service outlets are locals. For instance, in 2011, Geely and the Uruguayan company Nordex jointly built an assembly plant in Montevideo, capital of Uruguay, producing an annual output of 20,000 vehicles and creating 300 jobs and providing 900-plus potential job opportunities.
Moreover, Geely pays great attention to local etiquette and customs. Since Muslim followers pray in the afternoon, the entire production line stops at these times. In order to allow workers to observe their prayer rituals, Geely’s plant in Egypt employs eight people in shifts at a position usually covered by one person in China.
Ambitious Plans for the World Stage
Strategically, overseas markets have become increasingly important for Geely. According to Yang Xueliang, Geely sold 490,000 vehicles in 2012, including 100,000 in overseas markets, taking up 20 percent of Geely’s total sales volume. “This percentage is expected to rise to 25 percent in 2013, and to 30-40 percent in the coming three to five years,” Yang said. In order to advance the brand’s popularity in the global market, the automaker is planning to integrate its three sub-brands (Global Hawk, Emgrand, Englon) into one – Geely.
At the same time, a three-step overseas development strategy has been mapped out. At the first stage, the company attaches importance to entering emerging markets through which Geely’s team for overseas markets can be developed and trained. Geely has three advantages in this aspect: first, the technical barriers in these markets are similar to those in China; second, emerging markets have higher growth rates than developed markets; and third, most overseas consumer groups focus on cost performance. The vehicles produced in China usually have superb cost performance, although they have not gained outstanding brand recognition yet.
EU and the U.S. are Geely’s targets in the second and third stages. Zhang Lin, vice-president of Geely Group, states: “Technically, there are no blocks in Geely’s routes into the EU and even the highly competitive U.S. markets. Our products like Emgrand cars meet EU import standards and have achieved E-NCAP standards.” Zhang further explains: “We are not in a hurry to enter the EU market since we need time to build our overseas marketing capacity.”
Zhang also revealed that the products jointly developed by Geely and Volvo are expected to be introduced into the European market in 2017.
What’s more, the automaker is sticking to its plan to build more factories overseas. It has mapped out a project for opening factories in Russia, and an assembly plant has been put into operation. In 2013, Geely signed an agreement with the Belarusian government on setting up factories there. In addition, Geely is mulling over a plan to open a factory in Brazil. R&D centers are also expected to be set up in the near future.
Geely plans to introduce its latest models to overseas markets. For example, the most up-to-date Emgrand EC7 is currently Geely’s major export product. In June 2013 in Saudi Arabia, EX7 was launched, as Geely’s first SUV to enter the overseas market. EX7 is believed to form a product grouping together with EC7.
At present, Geely is researching a collision mitigation system capable of protecting a car from collision as well as of detecting objects at a distance. A sample model equipped with this system has been successfully developed, with first-generation products to be launched at the end of 2014.
At the gates of Geely’s Beilun Factory in Ningbo, China, a poster can be seen declaiming, “Make Geely a Brand Famous across the World.” This represents an ideal and a career goal for all of Geely’s staff. They are committed to bringing automotive bliss to people all over the world through their quality products.
