Geely devoted to greening of London

Chinese owner of hackney carriage maker to invest 250 million pounds in Coventry facilities

The Chinese owners of London Taxi Company and the leaders of London and the United Kingdom are working together to ensure that the company's iconic black cabs have a green future domestically and abroad.

At the Holyhead Road headquarters of the London Taxi Company, its owner, Zhejiang Geely Holding Group Co Ltd, announced that it would invest 250 million pounds ($371 million, 341 million euros) to create a new factory at Ansty Park on the city's outskirts. The investment is expected to generate up to 1,000 new jobs.

The new state-of-the-art research, development and assembly facility would develop and produce the next generation ultra-low emission London black cab. The vehicle is expected to be an electric hybrid.

British Prime Minister David Cameron and London Mayor Boris Johnson visited the company in Coventry on March 26 for the announcement.

The 85,000-square-meter site, which is close to the company's existing factory, eventually would have the capacity to assemble up to 36,000 vehicles a year, tenfold the existing capacity.

"This investment will secure the future of London Taxi Company. Almost two years after we acquired this company - in which we first took a stake in 2006 - it has become an important part of our global automotive strategy," said Li Shufu, founder and chairman of Geely.

"The London Taxi expansion will show how we can harness our resources, industrial know-how and technology to produce an environmentally friendly, next-generation London black cab," Li said.

Investment in the new plant is part of an ambitious plan to capitalize on a new market opening up for the black cabs as a result of changing low-emission regulations around the world.

In London, new guidelines were unveiled in January requiring all new licensed London taxis to be capable of running emission-free, with the expectation that they would automatically operate in zero-emission mode in areas where air pollution is at its worst, The Daily Telegraph reported.

On the same day he visited the London Taxi Co, Johnson confirmed that the world's first ultra-low emission zone will come into force in London on Sept 7, 2020, following a survey of residents, businesses and stakeholders that showed support for the proposal.

It will require vehicles traveling in the congestion charge zone of central London to meet new emission standards at all times or pay a daily fee.

Johnson has kept in close contact with Li for more than a year to help promote the plan for the greening of the London taxi, Li said.

"We will produce the most advanced and greenest taxi in the world," Li said, adding that he believes that the new generation taxi will become the pride of China and Britain and be a brilliant success globally.

Johnson said such efforts are key to the city's plans.

"The production of zero emission capable vehicles, incorporating the latest state-of-the-art technology, is essential as we strive to create the greenest taxi fleet in the world for London," Johnson said.

"I warmly welcome Geely's commitment to building this impressive new factory in Coventry, highlighting the UK's position as a world leader in the development and manufacturing of ultra-low emission technologies.

"The vehicles this facility produces will help transform London's taxi fleet, boost jobs and growth in London and the West Midlands, and secure the long-term future of the taxi industry, whilst ensuring everyone who lives, works in or visits our city has the cleanest possible air to breathe," Johnson said.

Johnson said he is delighted that an internationally recognized symbol like the black cab will continue to be manufactured in Coventry.

Geely's commitment to the London Taxi Company marks the largest greenfield investment in the UK by a Chinese company and is being backed with funding from the UK government's regional growth fund and other UK and local government support. A greenfield investment is one involving construction of new operational facilities from the ground up.

An extra 25 million pounds from the British government will be used to provide grants to help taxi drivers cover the cost of upgrading to a greener vehicle. This will be in addition to the 40 million pounds already committed by the mayor to assist taxi drivers whose vehicles would be affected by tighter age limits to retire the oldest, most polluting taxis.

"Geely's 250 million pound investment and the creation of up to 1,000 jobs is great news for Coventry and a vote of confidence in our long-term economic plan to back business, create jobs and secure the recovery," Cameron said.

The company's existing site has been home to the London Taxi Co for almost 70 years.

"The London black cab is iconic around the world and I am pleased that the next generation will have a state-of-the-art production facility in the UK," Cameron said.

Li said that Geely is hoping its investment in black cabs will open up significant new export opportunities.

Most of the black cabs made in Coventry now are for the UK market, predominantly London. The hope is that about 20 percent of taxis will be built for the UK, with the remaining 80 percent shipped abroad to markets elsewhere in Europe and beyond.

Portions of the company's taxis are made in China. The new vehicle will be developed using significantly increased UK and EU content, bringing local economic benefits through the supply chain. It will be launched in the UK at the end of 2017 and across international markets in 2018.

The investment underlines Geely's commitment to London Taxi Company and the UK following its rescue of the business out of bankruptcy administration in 2013. Since then, the company has invested significantly to restart production and finance the development of the successor to the existing TX4 taxi.

Geely is trying to revive the fortunes of London Taxi Co after buying up its assets and the name in 2013 following the collapse of Manganese Bronze Holdings Plc, which had been making the taxis since 1948.

The Chinese car manufacturer had held a 20 percent stake in the firm since 2009, after forming a joint venture with Manganese Bronze in 2006 to supply the UK business with car parts.

"We are proud of the company's regional heritage in an area that is steeped in automotive and manufacturing history," said Peter Johansen, vice-president of UK operations for the London Taxi Co.

"Geely's investment in this new facility is testament to the dedication of all those who work at the London Taxi Company and this city's reputation for producing world-class engineers.

"We intend to build vehicles in the vanguard of environmental technology which sets new standards for comfort and performance," Johansen says.

(China Daily European Weekly 04/03/2015 page19)