Why Geely could be a contender

In this time of angst in automaking, which company is best poised to dominate the future? Who has the right strategy to juggle — and master — the demands of autonomy, mobility, electrification, global regulation and retail transformation?

Will it be one of the industry's pioneers — Daimler or Ford? A master of global scale such as Volkswagen, Toyota or the Renault-Nissan Alliance? Nimble innovators such as Mazda and Tesla?

Or how about D: none of the above?

Indeed, the future is so unclear right now that the leader of the new automotive order could be a company that was born in 1986 making refrigerators, didn't produce its first car until 1997 and has since offered models called the King Kong and the PU Rural Nanny.

Think that sounds silly? OK, a little.

But in confronting the disruptive forces facing the auto industry, an underdog such as China's Zhejiang Geely Holding Group Co. may well prove to be one of the best prepared companies, thanks to the foresight of its mercurial founder and chairman, Li Shufu, its deepening relationship with Volvo and its record of success in the world's most dynamic economy.

While Tesla and Google make headlines as the purported disruptors of our era, it's Geely that has quietly seized on the industry's biggest challenges — not with small-scale pilot projects but expansive commitments and aggressive strategies to fulfill them.

Driving that ambition is Li, who grew up in a farming region in Zhejiang province and began his vocational life as a photographer before moving on to engineering and entrepreneurship.

Michael Dunne, president of Dunne Automotive, a Hong Kong investment advisory firm and an expert on the Chinese auto industry, calls Li "part poet, part visionary — at heart a fearless entrepreneur."

Says Dunne: "He asks, 'What do we have to do to win?' "

Electrification? Check. Geely's Volvo has pledged to offer an all-electrified lineup by 2019, and a separate subbrand called Polestar is devoted to making electric cars not just practical, but fast and sexy — that is, Tesla-like. In 2016, Geely delivered roughly 49,000 EVs in China, second only to Chinese EV giant BYD. In 2015, Li announced a target of deriving more than 90 percent of annual sales from alternative-energy vehicles by 2020, with EVs accounting for no fewer than 35 percent of those vehicles.

Urban mobility? Check. Geely owns the company that produces London's iconic black cabs, and it has a new U.K. plant that's fitting them with plug-in hybrid powertrains. Last year, Geely launched a proprietary ride- hailing service under the name Cao Cao. As of June, it had dispatched more than 10,000 EV taxis to 11 cities in eastern China.

Autonomy? Check. Volvo is a research leader in safety and focused on making unsupervised autonomous cars a reality by 2021. It has a joint venture with Sweden's Autoliv to develop software for autonomous systems that can be supplied to other automakers.

Economies of scale? Check. Ever since the Geely holding company acquired Volvo from Ford Motor Co. in 2010, Li has arranged for the Geely brand and Volvo to develop vehicle technologies and platforms together. In August, Li formed a Volvo-Geely joint venture to share all vehicle architectures, powertrain development and electrification, and Geely's new global premium brand, Lynk & CO, will gain access to Volvo's newest modular platform for midsize and large vehicles. Geely also has acquired stakes in Malaysian automaker Proton and sports car maker Lotus.

Alternative ownership and retail models? Check. When Lynk & CO's 01 compact crossover arrives in the U.S. in 2019, Geely plans to let buyers order online, rather than through a franchised dealership. Another concept, the 03 sedan, includes onboard software to enable sharing and a subscription payment model.

"We hope to pass down the spirit of sharing through automobiles," the company says in a 2016 report.

Sure, but what about flying cars? Actually, yes. According to media reports, Geely agreed to buy U.S.-based startup Terrafugia, which claims to have developed the world's first practical flying car, called Transition.

There was a time when there were doubts about the roadworthiness of Geely's vehicles, let alone their airworthiness. Li and his company showed up in Detroit in January 2006 as the first Chinese automaker to exhibit at the Detroit auto show, with dreams of beginning U.S. sales in 2008.

The occasion was widely noted as the dawn of a new era, but the drab sub-$10,000 people's car on display was underwhelming, delivering a reality check across China's auto industry.

Geely got its big break when Li sealed a deal to take Volvo Cars off Ford's overburdened hands in 2010.

"Many people were skeptical," recalls Dunne.

Volvo "must have been making no more than 300,000 cars a year at the time, barely making money and not doing much," Dunne says. "And he said, 'This is the way forward.' The only way to get the world's finest technology was to buy it."

Geely bent over backward to reassure skeptics that it would be a benign overlord and allow Volvo's Swedish character to blossom, undiluted by Geely's mass-market ambitions.

"I want to emphasize that Volvo is Volvo and Geely is Geely — Volvo will be run by Volvo management," Li told reporters then. "We are determined to preserve the distinct identity of the Volvo brand."

But the Geely that has emerged from that moment isn't just a caretaker. It's a risk taker. It was the first automaker with the courage to sell China-built cars in the U.S. and envisions turning ever-struggling Lotus into the next Porsche. Lynk & CO will seek to challenge the world's best in the U.S. and Europe.

Li isn't daunted. "I don't see competition in a very complicated way," he told Automotive News Europe last year. "If we can reach or exceed the expectations of our customers, I think we can be successful."

Yang Jian and Richard Johnson contributed to this report.