Geely's Daimler deal is just a matter of course: China Daily editorial

It would be sad if Chinese automaker Zhejiang Geely Holding's surprise emergence on Friday as the biggest investor in Mercedes-Benz owner Daimler, with a 9.69-percent stake, becomes fuel for China phobia.

A German parliamentary committee is to reportedly question government officials on whether Geely violated disclosure rules and whether loopholes in securities trading law need to be closed.

Geely is not snapping up shares without consideration, it has made no secret about what it wants — access to Daimler's know-how in electric and autonomous vehicles — and in its eagerness to acquire them it has reportedly employed aggressive tactics to build the required voting stake after its earlier overture to Daimler was rejected. Although former Morgan Stanley Germany CEO Dirk Notheis is said to have been the architect of Li Shufu, Geely's founder and chairman, amassing shares in the German automaker.

Geely may be an unwelcome partner to Daimler executives, who had various reasons to give it the cold shoulder. It owns rival carmaker Volvo, and Daimler already has a Chinese partner, the Beijing-based carmaker BAIC. Likewise, German market regulators may have questions about how Geely managed to acquire its stake in Daimler, even launch a probe, as the financial and markets regulator, BaFin, is reportedly doing.

At the end of the day, as German Economy Minister Brigitte Zypries said on Monday, this is a business matter after all.

It is a gamble, so that Geely can compete in the rapidly changing global automotive market.

Geely is only one of numerous Chinese companies trying to sharpen its edge in the fierce competition in a globalized market. The Chinese government holds no stake in the listed company. Geely's business operations in China are subject to Chinese industrial policies and government regulation.

While keeping an "especially watchful eye" on Chinese investments, the German government should not ignore this: Last week BMW announced a deal with Chinese manufacturer Great Wall Motor to build electric-powered Mini cars in China for the local market, and over the weekend, Daimler announced a $1.9 billion investment into its partnership with BAIC. It's a two -way street.

The suspicions that the deal will be a "gateway" for Chinese industrial policy interests simply show how much people prefer to cling to their positions rather than exercise rational judgment.

Things do not need to be more than they are, Geely simply wants to survive the tech tsunami that is about to engulf the automotive industry.