Geely signs deal with Ford on Volvo takeover

• Source: Global Times
• [20:46 March 28 2010]
• Comments

Alan Mulally, Ford's President and CEO, said: "Volvo is a great brand with an excellent product line-up. This agreement provides a solid foundation for Volvo to continue to build its business under Geely's ownership."

The Volvo acquisition will offer Geely an access to the brand's core technology it needs, while the Chinese automaker will keep Volvo's current management teams unchanged. Geely has no plans to shut down assembly lines and other factories operated by Volvo currently in Swedenand Belgium nor lay off workers employed by those facilities.

Geely aims to increase its annual sales from current 400,000 units to about one million in four to five years. It also plans to build a new Volvo plant in China capable of producing 300,000 vehicles  annually

Geely believes the new Volvo has the potential to sell 200,000 cars a year in China. The company wants to use Volvo's manufacturing capacity fully in Europe to sell 600,000 vehicles there and in North America.

Geely got financing from banks in China, the US and Europe, including low-interest loans guaranteed by the governments of Sweden and Belgium. Geely's Hong Kong-listed unit, Geely Automobile Holdings Ltd., and some Chinese local governments also would invest in the deal.