Billionaire Li Shufu: Geely’s R&D expense totals nearly RMB100 billion in recent decade

Shanghai (Gasgoo)- Zhejiang Geely Holding Group (Geely) poured over RMB21 billion into R&D businesses in 2018, accounting for nearly 6.4% of the group's annual sales revenue, said Li Shufu, the founder and chairman of Geely.

Besides, Geely's R&D expense in the recent decade totaled roughly RMB100 billion, according to the speech the Chinese billionaire extended on September 20 at the 3rd Western China International Fair Import and Export Expo & Western China (Sichuan) International Investment Conference.

“The operational investment for an automobile company must feature a reasonable structure, of which the greatest deal of money must be plowed into R&D, rather than merely increasing capacity,” said Mr. Li.

He added that Geely's R&D expense has been rising year by year. In the future, the group will maintain a comparatively strong R&D investment and Geely's long-term strategy goal will not be affected by the temporary market volatility.

Geely's R&D proportion is basically in line with that of a large-scale global automobile group, partly reflecting its global competitiveness in R&D level, Li Shufu stated.

The stronger R&D power endows Geely with confidence in joining hands with peers from the global automotive stage.

The group has cooperated with Germany’s Daimler in several programs. The latest one is an joint investment in German air taxi startup Volocopter, which announced earlier this month the first closing of its Series C funding round.

On October 24, 2018, Daimler Mobility Services and Geely Group Company announced that they would form a 50-50 premium ride-hailing joint venture headquartered in Hangzhou.

The other cooperative move happened in this year's March where two automakers unveiled the formation of a 50-50 joint venture to own, operate and further develop Smart-branded vehicles as a leader in premium-electrified vehicles (Geely Automobile's WeChat account).