Volvo proposes leadership change

Swedish commercial vehicle manufacturer, Volvo, has presented its election committee with a revised board proposal due to the announcement that Chairman Li Shufu of Chinese automaker company, Geely Group, has become the largest shareholder in Daimler.

Volvo’s election committee reportedly no longer proposes a re-election of Swedish businessman, Håkan Samuelsson. It has proposed that Volvo Car Group CEO, Eric Elzvik, be elected as new board member at the Annual General Meeting on 5 April. The committee has also proposed the re-election of Chairman of the Board, Carl-Henric Svanberg, as well as Board members Matti Alahuhta, Eckhard Cordes, James W. Griffith, Martin Lundstedt, Kathryn V. Marinello, Martina Merz, Hanne de Mora and Helena Stjernholm. Lars Westerberg has announced that he will not be standing for re-election.

The reason that Samuelsson is not proposed for re-election, according to Volvo, is the announcement that Geely Group has become the largest shareholder of the German vehicle manufacturer Daimler, one of Volvo Group's major competitors.

Volvo announced in February that Shufu became a new shareholder of Daimler, acquiring 9.69 per cent of voting shares, long-term investment, focus on digital technology services and electro-mobility.

"Daimler is an outstanding company with a first-class management,” said Shufu.

“It will be an honor to support this unique team under the leadership of Dieter Zetsche in the future.

"I am particularly pleased to accompany Daimler on its way to becoming one of the world's leading electro-mobility providers,” he said.

The share purchase makes Li Shufu currently the single largest shareholder of Daimler and points to a long-term commitment. For the time being neither Geely Group nor any other company in the Zhejiang Geely Holding Group intend to acquire additional shares.

"I will fully abide by the company charter and governance structure of Daimler and respect its values and culture,” said Shufu.

With revenue exceeding CNY 270 billion ($54.8 billion) in 2017, the Zhejiang Geely Holding Group is China's largest privately owned automotive manufacturing company and one of the world's leading providers of electro-mobility. Major assets of the group include leading Chinese automaker Geely Automobile Holdings Ltd., Hangzhou (46 per cent), Volvo Cars, Gothenburg, Sweden (100 per cent), Lotus Motor Cars, Norfolk, UK (51 per cent), Proton Cars, Malaysia (49.9 per cent) and London Taxi, Coventry, UK (100 per cent).

Geely Group owns one of China's largest car-sharing providers, Cao Cao (100 percent), operating a fleet of around 16.000 electric vehicles worldwide.

"The competitors that challenge the global car industry in the 21st century technologically are not part of the automotive industry today,” said Shufu.

“But challenges create opportunities. No current car industry player might 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 united strength. My investment in Daimler reflects this vision,” he said.

Volvo Group’s election committee comprises representatives of three of the company's largest shareholders, who together represent 11.3 per cent of the outstanding shares and 33.5 per cent of the outstanding votes, and the Chairman of the Board. The members who represent the largest shareholders are Bengt Kjell, representing AB Industrivärden, Yngve Slyngstad, representing Norges Bank Investment Management, and Pär Boman, representing Svenska Handelsbanken, SHB Pension Fund, SHB Employee Fund, SHB Pensionskassa and Oktogonen.

(Image: Geely Group Chairman and largest shareholder of Daimler, Li Shufu.)