• Sweden's news in English
 

Volvo takes pole after China truck purchase

Published: 26 Jan 2013 09:41 GMT+01:00

The firm announced on Saturday that it had agreed to pay almost 5.8 billion kronor ($900 million) for the stake in the Hubei-based firm, which is a newly formed subsidiary of Dong Feng (DFG).

"The deal is a fantastic opportunity for us, and gives us a strong position in the world's largest truck market. The Chinese market is as big as USA's and Europe's combined," said Volvo's spokeswoman Kina Wileke to the TT news agency.

The deal is conditional on the approval of competition authorities and is expected to take around 12 months to complete. But according to Wileke it establishes AB Volvo as market leader within heavy trucks, overtaking Daimler.

"Dong Feng and AB Volvo sold a combined 400,000 heavy and medium duty trucks in 2011," she pointed out.

Volvo will make payment of the some 5.6 billion Chinese Yuan sales price at the completion of the deal. Dong Feng will retain the remaining 55 percent in DFCV.

The deal will increase AB Volvo's net debt by around 6 billion kronor and the firm declined to specify how the purchase will be financed.

"We are not telling," Kina Wileke said.

According to Wileke, the deal is the largest single industrial investment by a Swedish firm to date in China and she assured that there are no plans to shift jobs from Sweden to China.

"As it looks now we are not going to move any jobs from Sweden to China as a result of this deal, on the contrary it creates employment. When we create jobs overseas, it also creates jobs in Sweden," she said.

AB Volvo's CEO Olof Persson called the partnership with Dong Feng "the best of both worlds" in a press statement.

"Dong Feng is a partner we know well, which we have worked with over the course of several years and which has a leadership and a product assortment which we really like," he said.

Persson identified benefits for both firms from the deal, pointing out the "excellent opportunities for economies of scale within purchasing, development and production within Volvo concern's truck operations".

DFCV holds a market share in China of around 16.1 percent within heavy duty trucks and 15.7 percent within medium-duty trucks. The firm has 28,000 employees.

The firm's head office is located in Wuhan in Hubei province and its truck operations and manufacture are concentrated in Shiyan, also in Hubei.

TT/The Local/pvs (news@thelocal.se)

Your comments about this article

16:57 January 26, 2013 by Just_Kidding
...how the purchase will be financed?

Easy to guess! from the sale of Volvo Aero to GKN.
Today's headlines
Increase in violence in Swedish asylum centres
The surge of migrants into Europe fleeing war-torn regions has increased the pressure on the Swedish migration system. Photo: Soeren Bidstup / AFP / Scanpix Denmark

Increase in violence in Swedish asylum centres

The Swedish Migration Board (Migrationsverket) has so far this year recorded almost as many reports of threats and violence in asylum accommodation as throughout the whole of 2014, according to the Swedish newspaper Dagens Nyheter. READ  

Wet July dampens Swedes' summer spirit
Rain in Stockholm. Photo: Marcus Ericsson/TT

Wet July dampens Swedes' summer spirit

Swedes complaining about the disappointing summer were vindicated after meterologists revealed on Friday that July indeed finished wetter – but warmer – than normal. READ  

Swedes get set for new money, money, money
Christina Wejshammar of Sweden's central bank. Photo: Vilhelm Stokstad/TT

Swedes get set for new money, money, money

A new smartphone app is set to help Swedes navigate the biggest switch in bank notes the country has ever seen with only two months to go before the new cash is introduced. READ  

Bananas free Swedish man from speeding fine
These are not the bananas on trial. Photo: Leif R Jansson/SCANPIX

Bananas free Swedish man from speeding fine

A Swedish driver has escaped speeding tickets in court – because the offender was eating a banana. If that sounds bananas to you, keep reading. READ  

Swedish farm mystery as pigs vanish without trace
Schörling suspects that the swine, which have a value of around 65,000 kronor, were stolen. Photo: Lars Pehrson/SvD/SCANPIX

Swedish farm mystery as pigs vanish without trace

UPDATED: A Swedish farmer is mystified about the disappearance of 64 pigs from his farmyard in the town of Vingåker, central Sweden. READ  

Snoop Dogg's initial drug test positive say police
Snoop Dogg in concert in Uppsala. Photo: Marcus Ericsson / TT

Snoop Dogg's initial drug test positive say police

Initial tests suggest that US rapper Snoop Dogg was under the influence when he was arrested by Swedish police after performing at a gig last weekend, a police spokesman told The Local on Friday. READ  

Mining behind Swedish 'earthquake' say experts
The Malmberget mine in northern Sweden. Photo: Carl-Johan Utsi/TT

Mining behind Swedish 'earthquake' say experts

On Friday Sweden awoke to news of the second earthquake in less than a week, this time in the far north of the country. But a seismologist told The Local that the tremors were the result of mining activity. READ  

Concerns over 'too Swedish' police force
Swedish police are struggling to attract people from foreign backgrounds. Photo: Fredrik Sandberg/TT

Concerns over 'too Swedish' police force

UPDATED: Swedish police academies expressed concern on Friday over a sharp decline in the number of foreign-born future officers. READ  

The Local Recipes
How to throw your own Swedish crayfish party
Swedish crayfish party. Photo: Carolina Romare/imagebank.sweden.se

How to throw your own Swedish crayfish party

August crayfish parties are one of the highlights of the Swedish calendar and appeal to people of all ages. Food writer John Duxbury shares his best tips with The Local for making your own crayfish party a success. READ  

Sweden to crack down on silly police reports
A police spokesman told The Local they receive many complaints from people who lose their car keys. Photo: Fredrik Sandberg/SCANPIX

Sweden to crack down on silly police reports

The Swedish government announced on Thursday that is is going to launch an investigation into valuable police time being wasted by officers forced to deal with unnecessary reports and complaints. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Technology
Modern mugging: Swedish thieves use smartphone app to rob man
Lifestyle
Five fun festivals to get you partying in Sweden this week
National
How a century-old Russian sub wreck got Sweden into a frenzy
Gallery
People-watching: July 29th
National
How to become a Swedish woman
Blog updates

31 July

Editor’s blog, July 31st (The Local Sweden) »

"Dear readers, As the Stockholm Pride Festival kicked off this week, we spoke to the chairman of..." READ »

 

15 July

Climate Change: A New Risk Assessment (The Diplomatic Dispatch) »

"Climate change is one of the most serious threats facing the world today.   The UK is..." READ »

 
 
 
National
Free bus cards for refugees in Sweden
Lifestyle
New snaps of Sweden's baby prince
National
Why are Swedes so scared of Russian submarines?
Gallery
Property of the week: Simrishamn, Skåne
National
Why has Snoop Dogg said he will never return to Sweden?
Sponsored Article
Getting pregnant the Swedish way
Features
Five outrageously harsh tourist comments about Sweden
Sponsored Article
Why is Sweden still working with Russia?
Gallery
People-watching: July 24th-26th
Travel
Seven ways to beat the Swedish rain
National
Should Sweden's alcohol stores be open on weekends?
National
How to become a Swedish man
Gallery
People-watching: July 22nd
Lifestyle
How to never miss your favourite features on The Local
National
Royal husband on 'breadwinner' role
National
Stockholm to ban all cars for one day
Sponsored Article
Outsourcing drives Apreel's Europe growth
Gallery
Property of the week: Sölvesborg, Blekinge
National
Questions over who would replace Swedish PM in a crisis
Gallery
People-watching: July 17th-19th
National
Why are Swedish women joining Isis?
Travel
Ten Stockholm streets you just have to walk down
Sponsored Article
'Swedish women must demand their partners use a condom'
Sport
Did UK football parents threaten Swedish kids?
Technology
Stockholm scientists find world's oldest sperm
Gallery
People-watching: July 15th
National
Angry Swede uses bird nest as fake speed camera
National
Meatball row as Ikea changes recipe
National
Sweden's new princess in spotlight
National
Slimy slugs go on sale to raise cash for EU migrants in Sweden
National
Crown Princess Victoria turns 38
Sponsored Article
Harstena: Life in Sweden's secret archipelago
National
Is this the best marriage proposal story in Malmö's history?
Sponsored Article
'Biofuels critical for climate-friendly flights'
Sponsored Article
Gaps don't have to kill your Swedish CV
National
Why summer could be the best time to invest in a Swedish property
Gallery
Property of the week: Bollnäs, Hälsingland
National
Swedish house on sale for one krona
National
Would you give this ugly food a home?
Gallery
People-watching: July 10th-12th
Travel
Foreign hikers in Sweden set to get more help in English
National
Prince Nicolas enjoys first summer
National
Meet the amazing Swedish granny who loves theme parks
National
Stockholm to host Eurovision 2016
Sponsored Article
'Swedish industry needs US trade deal'
Sponsored Article
Sweden's 'incredible' chance to connect
Sponsored Article
'Today's refugees could be tomorrow's Zlatan'
Sponsored Article
Crans-Montana: International expat hub
Sponsored Article
‘I don’t feel Swedish, I feel international’
Sponsored Article
VIP Mingle at Almedalen's hottest event
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

3,287
jobs available
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
psdmedia.se