Geely studies manufacturing electric cars in Valencia

The Geely E2 (also called EX2 in Latin American markets) is an affordable 4-meter-long electric car with about 395 kilometers of range and power outputs of up to 116 hp that last year became the best-selling car in China. Aware of the potential of its urban electric vehicle, the Chinese automotive giant Geely made the leap to Europe some months ago, but the fact of having to pay tariffs and transport and distribution costs means that its cars are not so competitive on the Old Continent.

The Ford plant in Almussafes is, for now, one of the main weak links for the oval brand. Ford is in a process of reorganization and withdrawal from the European market, and in recent years it has stopped manufacturing some of its most relevant cars, such as the Focus, the Fiesta or the Mondeo, among others. Last February Bloomberg already warned that Ford had begun to negotiate with the Chinese giant Geely to reach an agreement for a transfer or convention to manufacture some of the Chinese models in Europe, taking advantage of the infrastructure and specialized labor that Ford has on the Old Continent. And the Almussafes plant is one of those that the Chinese giant's top brass values most highly thanks to its location, the ease of communication with the rest of Europe, and the proximity of battery manufacturing centers and other suppliers. The Iberian Peninsula has become one of the industrial targets for Chinese brands, as to the arrival of Chery in Barcelona we must add the landing of Leapmotor at the Figueruelas plant, in Zaragoza, where it will also manufacture an affordable urban electric vehicle. The Almussafes plant is an industrial opportunity, and Geely would like to copy part of the strategy of Chery and its subsidiaries Omoda, Jaecoo and Ebro in Barcelona, which for now has worked according to the initial objectives.These weeks some local suppliers of Ford Almussafes have been contacted by Geely executives, as reported by Economia Digital, in a move that seems to confirm the Chinese brand's intentions to establish itself in Valencia. Currently, only the Kuga is manufactured at the Ford Almussafes plant, and during the past year only about 100,000 vehicles were produced there, far from the plant's operational capacity, which exceeded 400,000 vehicles last produced in 2017. In this regard, the arrival of the Geely E2 (or EX2) would be a breath of fresh air for a factory that seemed condemned to ostracism –and who knows if to closure– due to Ford's poor economic results.An electric, urban and rational car

Geely is one of the major Chinese automotive groups, with a strong presence in Europe through Volvo and Polestar, its two European subsidiaries, positioned in the most aspirational segment of the market. Geely also has the Lynk & Co division and the legendary British brand Lotus, among others, and has agreements and conventions with Mercedes-Benz for the control of the Smart subsidiary. With the most aspirational and luxury part of the European market well covered, the group's strategy in Europe now focuses on affordable models.

In this sense, the next logical step for the Chinese brand is to start introducing some of its affordable electric models in Europe, such as the E2 or EX2. This electric car aims to be the alternative to the BYD Dolphin Surf, its great rival in China, but also to be able to compete with the Renault 5 or the new Volkswagen ID Polo and Cupra Raval, among others, and position itself in the price range below 20,000 euros. Geely's top management knows that the international context and trade tariffs will make it very difficult for a Chinese electric model to be marketed below this range, unless it is through collaboration and production in local plants by taking advantage of industrial agreements with traditional manufacturers like Ford, which is in full process of industrial and commercial repositioning.