Geely gets in high gear
- Source: Global Times
- [08:19 January 20 2010]
- Comments
The 100 percent acquisition would boost the private carmaker's image, help improve its technology and enrich its sales network in Europe and North America markets, said Zeng, adding he didn't expect an "ambitious" overseas expansion by Geely.
Zeng said besides growing in China, the most important thing for Geely Group for the next few years is to stop Volvo from losing money.
Volvo has been losing money for the past few years and in 2008 sales fell 18.3 percent to 374,297. Compared with the purchase price, Volvo's operational costs might be even higher.
Besides maintaining Volvo's Sweden plant, it has been widely reported recently that Geely Group is talking with the Beijing municipal government to set up a plant.
Zeng said the plant won't be ready for mass production until two or three years from now.
Even more questions like "will people buy a made-in-China Volvo" and "how will Geely work with Ford's partner in China, Changan Ford on production and its sales network" also need to be resolved.
New models
Geely Group, spending 10 percent of its sales revenue on R&D, started in 2007 to transform its strategy from making low-end autos for ordinary Chinese to making medium and high-end cars.
It launched three sub-brands, Gleagle, medium-end Emgrand and Shanghai Englon.
Existing models like Free Cruiser, KingKong, and Vision will all be turned into three sub-brands in early 2011.
Its first high-end sedan Emgrand EC718 debuted for sale last August.
Currently, few Geely vehicles are priced below 40,000 yuan ($5,859).
After rolling out five new models last year, Geely will launch three new models and nine modified models this year, anticipating 400,000 vehicles sold, up 25 percent year-on-year.
