Mercedes-Benz has begun early discussions with China’s Geely about expanding cooperation on future vehicle development in China, Bloomberg has reported.
The preliminary conversations are centred on potential collaboration on vehicle models planned for release after Mercedes’s current generation of EVs.
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Greater reliance on Geely could enable the German manufacturer to shorten development timelines and cut engineering expenses in China, its largest market.
The shift comes as domestic Chinese carmakers continue to gain ground with faster development cycles and aggressive pricing.
A Mercedes spokesperson told the news agency that the company “is continually reviewing ways to make research and development faster, better and more efficient – both in China and globally.”
The talks also highlight a broader trend within Europe’s automotive industry, where established manufacturers are increasingly engaging with Chinese partners to maintain competitiveness.
According to a recent report, Stellantis is assessing potential agreements with Chinese carmakers linked to its European operations while prioritising investment in the Americas.
For Mercedes, a deeper partnership with Geely would be a sensitive move and the discussions may not necessarily lead to a formal agreement, according to Bloomberg’s sources.
Mercedes’s primary manufacturing partner in China remains the state-owned Beijing Automotive Group Co. (BAIC).
Geely founder Li Shufu is also one of Mercedes’s largest shareholders, and the two companies already maintain regular exchanges between their senior management teams.
Mercedes and Geely currently work together through a joint venture for Smart, which has been repositioned as an all-electric brand.
Within that partnership, Mercedes is responsible for design while Geely oversees engineering and manufacturing, including production of the Smart #3 crossover.
Separately, Mercedes-Benz recently resolved a case with the US National Labor Relations Board (NLRB) concerning allegations related to its conduct during a union organising campaign at its Alabama facility.
As part of the agreement with the NLRB, the company will distribute and adhere to a notice outlining employees’ rights to organise.
