Geely Plans to Export 1 Mil. Cars to Europe, US

China’s Geely has quietly taken big strides toward meeting its goal of exporting 1 million cars by 2015, most of them to Europe and the US. A key element of its strategy is to tout its safety image by leveraging the Volvo brand which it bought from Ford in 2010.

Geely has developed the GTSM (Geely Total Safety Management) system based on the Volvo City Safety anti-crash system. Last November Geely’s EC7, a model of its Emgrand luxury marque, received an impressive four stars in crash safety tests from the European New Car Assessment Program (Euro NCAP), the highest mark ever awarded to an independent auto brand in those tests.

The crash testing was carried out because Geely is preparing to enter the European and the US auto markets, said vice president Zhao Fuquan. It is also preparing to enter the UK market by buying Manganese Bronze Holdings, a London taxi-maker that had announced a distribution tie-up with Geely last August.

One of the challenges Geely faces in 2012 is winning approval to locate a Volvo manufacturing plant in Daqing in the northeastern province of Heilongjiang. Currently the government is carrying out a six-month environmental impact study of Geely’s plans before granting approval. Volvo is also awaiting environmental approval on its plans to establish a factory in the southwestern city of Chengdu. Until Geely can start making Volvos in China, the brand will face an uphill battle toward viability due to the high costs it has been struggling with for at least the past decade.

In 2011 Geely’s sales rose just 1.2% to a total of 421,385 units, far short of the goal of 480,000 units. Its December sales fell 15% from the same month of 2010. However, Geely expects to meet its 2012 sales target of 460,000 units because of several new models in the popular SUV and MPV segments.