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 Peter Horbury is central to efforts by Geely - long seen as a cheap,
no-frills brand in China and unknown in the western world - to push
upmarket and go international by tapping European design and
technology.
Zhejiang Geely Holding Group <0175.HK>'s purchase of struggling
Swedish carmaker Volvo from Ford <F.N> in 2010 has helped it
leapfrog a decade of research and development.
The tie-up has enabled Volvo to sell more vehicles in China than
anywhere else and produced a common platform for Geely to widen its
range. But at seventh place in China's light vehicle brands, it has
a long way to go in a sector suffering from overcapacity and stiff
competition.
Horbury, who headed up design at Volvo in the 1990s and oversaw it
for Volvo, Jaguar, Aston Martin and Ford's other brands from 2002,
says carmakers should play up their roots, citing what he called the
"Hi, I'm Dave" all-American appeal of his Lincoln grille.
"I'm not suggesting we'll do cars with pagoda roofs, but all new
cars have a little signature somewhere that's Chinese," Horbury,
Geely's chief designer since 2011, told Reuters at the Swedish
design studio where he spends three weeks a month.
That means dashboard curves which he compares to a famous Chinese
bridge in Hangzhou where Geely has its headquarters.
"Here at a Chinese company, I think there is something special to
sell, and if you just become anonymous, that's what you remain,"
said Horbury, 66, who spends a week each month in Shanghai.
Geely cars range from 38,900 Chinese yuan ($6,000) to 249,800 for an
electric vehicle. Its new flagship GC9 sedan, which Horbury worked
on, starts at around 120,000 yuan.
"The product seems pretty good, styling wise, and they have got to
get the core sedan product right which it appears that they have
(with the GC9)," said James Chao, Asia-Pacific chief of IHS
Automotive.
"But that's just the start of the brand building exercise. It will
take years for them to build this brand, whether it's this brand or
another brand, to upgrade to the Volkswagen level," he said. "In the
meantime, they’ll have to price a bit more aggressively."
Volvo and Geely each sold about half a million cars last year while
world leaders Toyota, Volkswagen and General Motors (GM) sold around
10 million each.
In China, Volkswagen <VOWG_p.DE> tops sales charts for all vehicles
compiled by LMC Automotive, with the biggest homegrown manufacturer
Changang in fifth place and Geely in 14th.
COMPETITIVE NEIGHBORS
Unlike neighbors Japan and South Korea, which are among the five top
car exporting countries in the world, China is not even in the top
20, the World's Top Exports website shows. It exported fewer than
half a million passenger vehicles in 2015, according to data from
the China Association of Automobile Manufacturers.
At the heart of Geely's ambition to break into European and U.S.
markets is the China Euro Vehicle Technology (CEVT) development hub,
created by Geely in 2013 in Sweden to build the platform which will
be used in all new Volvo and Geely models.
On Wednesday, Volvo is set to unveil two new concept cars - the
first to use the common platform. Sources have told Reuters Geely
will launch a new brand next year, codenamed "L", with cars based on
the platform.
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"Not even during my time at GM did I experience a more aggressive
growth plan," said auto industry veteran Mats Fagerhag, who heads
CEVT, a tech center in Gothenburg with a staff of 1,700 in which
Geely is investing several hundred million dollars a year.
Fagerhag said local production in Europe could be a future step, to enable Geely,
which also owns the company that makes London's trademark black cabs, to get a
complete range of brands the same way Volkswagen has. Horbury declined to
comment on brands.
NUMBERS
After initial scepticism over whether Geely could make the most of European
technology, it has proven to be a keen investor and collaborator. The joint
development between the Swedes and Chinese appears to be paying off when looking
at the numbers.
Volvo, whose ads play up its Swedish heritage, featuring football player Zlatan
and musicians Swedish House Mafia, saw earnings triple last year thanks in large
part to demand in China, now its largest market.
"We went from zero to three factories, to 5,000 people, 200 dealers," Volvo CEO
Hakan Samuelsson told Reuters.
Record sales are predicted this year as Volvo pushes into a premium sector
dominated by German heavyweights such as Daimler Mercedes-Benz and BMW.
Geely, which means auspicious in Mandarin, came through China's auto market
slowdown with sales up 22 percent last year compared to 4.7 percent for the
market overall.
"Both can learn from each other - the knowledge that we have that is in the
bricks here of how to engineer a car the way Volvo has ... the way we approach
design from a more human point of view perhaps, and the fact that the Chinese
come with a spirit of 'Let's get it done,'" Horbury said.
The designer, who started with a staff of six in a "borrowed room" at Geely, now
leads 350 designers in Gothenburg, Shanghai, Barcelona and California.
Geely Chairman Li Shifu, who founded the group in 1986 as a refrigerator
parts-maker with a loan from his father, sometimes visits the Swedish studio -
an old shipbuilding warehouse.
Horbury said Li's approach was very different from that of his American or
European bosses, combining entrepreneurship with art and poetry. One time, Li
brought a stack of books to the studio littered with post-it notes.
"One was on geology - rock formations - one was on Chinese landscape, one was on
Chinese architecture, and fashion," Horbury said. "Just examples that he felt
would inspire the designers for the next Geely."
($1 = 6.5285 Chinese yuan renminbi)
(Additional reporting by Edward Taylor in Frankfurt and Jake Spring in Shanghai;
editing by Alistair Scrutton and Philippa Fletcher)
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