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China to back Geely purchase of Volvo

China to back Geely purchase of Volvo

Published: 31 Dec 2009 10:25 GMT+01:00
Updated: 31 Dec 2009 10:25 GMT+01:00

The Chinese government will support the sale of Swedish automaker Volvo to Geely Automobile, the company said on Thursday.

Gui Shengyue, Geely Automobile's executive director, said its parent initially planned to develop Geely Automobile and Volvo as separate brands.

He said Geely will look at ways to collaborate with Volvo once its parent group completes the acquisition of the loss-making Swedish brand from US auto giant Ford.

"But when the timing is right, we will find a suitable point of collaboration," he said during a press conference in Hong Kong.

Gui said the acquisition had the backing of the Chinese government and was expected to be completed in the first quarter of 2010.

Injecting the Volvo operation into Geely Automobile remains parent Geely Group's ultimate goal, Dow Jones Newswires quoted Gui as saying.

Geely Automobile would consider supporting Volvo on strategic development and financing, he also said.

Zhejiang-based Geely Group, one of China's largest private carmakers, and Ford announced last week they had agreed on the main terms of Volvo's sale.

Overseas demand would support the long-term growth of China's auto industry, Gui said.

"The automobile industry in the domestic market will continue to grow in the next two years. After that, its growth will mainly come from its overseas markets."

AFP/The Local (news@thelocal.se)

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Your comments about this article

11:56 December 31, 2009 by Atlas
So, next time you buy a Volvo it will come with complimentary biography of Mao Zedong along with his military doctrine, People's War...

Happy New Year Sweden, from across the strait ;)
12:18 December 31, 2009 by krigeren
@Atlas

My old Volvo bought under GM's ownership period came with the DVD Dumb and Dumber.
13:20 December 31, 2009 by Atlas
@krigeren, Good for you :)
17:59 December 31, 2009 by rumcajs
China's gov is nopt really a saint of my devotion, but in THIS ONE CASE, they are doing what they should do and what the swedish gov should've done ages ago. In case some1 is gonna call me communist... I AM NOT COMMUNIST, but one should not act according just to one's idealogy cos there's not just black and white.
20:49 December 31, 2009 by tsruikk
Damn communists. ;-)

This is definitely interesting to watch what goes on with Volvo and this deal. Waiting to see where the actual production ends up.

Now if only a deal with Saab comes about...
09:22 January 2, 2010 by spy
Poor Volvo, these guys are savages.
07:11 January 3, 2010 by Katanga
Remember? When the Yankees took over Volvo nobody was complaining about it. Now that the Chinese are on board there's a big moaning all around.

Ford throws away Volvo like a hot potatoe; mayby they should have asked Mr. IKEA to buy Volvo at a dumping price...........

Anyway, as long as Volvos are engineered and manufactured in Sweden I'll stick to this unique brand. Once the first communist Volvo appears in Europe, I switch to another brand.
18:04 August 3, 2010 by HenryMaxwell
I'd shoot for a 240 with a bit fewer miles on it and for around $600-700. one more thing, the odometers in these cars were notorious for failing so the one you're considering may have even more miles on it than the odometer has recorded.

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