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SHANGHAI (Reuters) -Geely’s chairman and founder Li Shufu said on Saturday that the global automotive industry was facing "serious overcapacity" and that the Chinese automaker had decided not to build new manufacturing plants or expand production in existing facilities.
Li made the comments at an auto forum in the central city of Chongqing, according to the company. Geely Holding owns multiple automotive brands including Geely Auto (HK:0175), Zeekr and Volvo (OTC:VLVLY).
His comments come as the Chinese auto industry, the world’s largest, has been locked in a brutal price war that is forcing many players to look to markets abroad and has prompted Chinese regulators to call for a halt.
Chinese automakers that have been building plants abroad include BYD (SZ:002594), Chery Auto and Great Wall Motor.
Geely is planning to use French automaker Renault (EPA:RENA)’s existing production facilities in Brazil and take a minority stake in Renault’s business in the Latin American country, according to an announcement it made in February.
Reuters reported in April, citing sources, that Chinese regulators had delayed approval for that. Geely said in response at the time that its cooperation with Renault in Brazil had been successful.