Chinese Co. buys maker of London Cabs
Saturday, 02 February 2013

When pop band The Spice Girls performed at the closing ceremony of last year's Olympics, they arrived on stage in glitzy versions of London's black cab. But now the United Kingdom is losing ownership of one of its most famous images to a Chinese auto maker.

Zhejiang Geely Holding Group said on Friday it has acquired the principal assets of Manganese Bronze Holdings, owner of the London Taxi Co. The price of the acquisition: $17.5 million.

The move reflects the international ambitions of China's auto makers while underscoring the difficulty of keeping a niche product, such as the black cab, afloat as manufacturing in Britain becomes more expensive. At the same time, taxi drivers have delayed purchasing new vehicles due to the country's poor economy, which has crimped spending by Londoners on expensive cab fares. London Taxi sold 1,502 cabs in the U.K. in 2011, down from 1,653 in 2010 and indicative of a long slide.

The deal is an example of how Chinese are on the prowl for global brands, particularly in Europe, where many consumer icons are struggling with dented consumer confidence and high manufacturing costs. Last year China's state-owned Bright Food Group Co. paid $280 million for British breakfast-cereal brand Weetabix.

Geely has said it plans to keep the factory in Coventry, England, where the black cabs have long been assembled. The Chinese company will continue to assemble cabs for the British market there, though many of the parts are made in China. Geely also plans to invest in updating the vehicle and expand sales of the traditional cabs outside the U.K. market, said Daniel Li, chairman of Geely's U.K. unit.

"Despite its recent difficulties, we have long believed that the company and the black cab have huge potential," Geely Chairman Li Shufu said.

The black cab, sometimes called a Hackney Carriage, has a colorful history dating back to the beginning of the 20th century. Its high-roofed passenger cabin was initially designed to accommodate gentlemen's top hats, and the trunk was built to fit the old luggage trunks that travelers brought on boats across the Atlantic. Cab drivers undergo extensive training and pass a detailed test called "the knowledge" before setting out on the British capital's roads.  


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