July 30, 2010
China's Geely to buy Volvo Cars: report
Published: 18 Jun 09 10:21 CET
Online: http://www.thelocal.se/20142/20090618/
Dictionary tool Double click on a word to get a translation
Chinese automaker Geely has reached an initial agreement with Ford for the purchase of Volvo Cars, according to Chinese media reports.
- EU approves Volvo loan guarantees (5 Jun 09)
- Rumoured Volvo deal halts trading for Chinese automaker (27 Mar 09)
- Swedish group among Volvo bidders: report (10 Mar 09)
As a part of the deal, Geely plans to start production of the new Volvo XC90 in Dongguan City in what is seen as a major step forward in the Chinese company’s bid to expand into the global auto market.
Terms of the deal were not disclosed, but Jia Xinguang, an analyst with the Chinese National Automotive Industry Consulting and Development Corporation reckons that Volvo would not be sold for less than $3 billion, the Shanghai Daily reports.
Ford purchased Volvo Cars in 1999 for around $6.5 billion.
Geely representatives were not available for comment, according to the Shanghai Daily.
A Volvo spokesperson told the TT news agency on Thursday that the company had no knowledge of any agreement to sell the Swedish automaker to Geely.
“Ford is in charge of the sale. We don’t know anything here,” said Volvo’s Maria Bohlin.
Greely Deputy CEO Daniel Dai also denied the report, telling Sveriges Radio (SR) that his company is too small to buy Volvo Cars.
According to Dai, the information about the alleged deal is mere speculation.
“We’ve already said three times previously that we aren’t involved in this project,” he told SR.
John Gardiner, a spokesperson for Ford Europe’s based in Germany also dismissed the rumours.
“This is just speculation from the market. We neither confirm nor deny these speculations,” he told the TT news agency.
“We continue to discuss Volvo’s future with a number of interested parties.”
However Gardiner refused to name any potential buyers or say how many had a continued interested in purchasing Volvo.
What do you think? Leave your comment below.
Fark It!
Digg This
Facebook
Share everywhere
Send to a friend
Printable version
Twitter This
Geely gets second green light for Volvo purchase
A second Chinese government body had approved China's Zhejiang Geely Automobile's plan to buy Swedish automaker Volvo from Ford, the company announced on Thursday. READ (1 COMMENT) »
Sweden reports 3.7% GDP growth in Q2
Sweden's gross domestic product (GDP) grew by 3.7 percent in the second quarter compared with the same period last year, Statistics Sweden (Statistiska centralbyrån, SCB) reported on Friday. READ »
China approves Geely's takeover of Volvo
China's Ministry of Commerce has approved Zhejiang Geely Holding's plans to buy Sweden's Volvo Cars from Ford, a report said on Thursday. READ »
AstraZeneca Q2 profit jumps on drug sales
Anglo-Swedish pharmaceutical company AstraZeneca said on Thursday that second-quarter net profit jumped to $2.1 billion (15.35 billion kronor) on strong performance across emerging markets and key drug sales. READ »
Glitch makes losing impossible at web casino
Swedish online casino Mr Green announced on Wednesday that it has corrected a technical problem that made it impossible to lose money when gambling on the site. READ »
Stieg Larsson first to sell one million Kindle books
Sweden's Stieg Larsson has become the first author to sell more than one million books in Amazon's Kindle electronic bookstore, the company announced on Tuesday. READ (3 COMMENTS) »
Finnair starts Bromma service in August
Finnair will launch a new connection from Helsinki to Stockholm through Bromma on August 16th in addition to its services to Arlanda, the airline has announced. READ (1 COMMENT) »
Saab turns profit after 2009 crisis
Crisis-hit carmaker Saab Automobile turned a profit of 3.9 billion kronor ($531 million) in 2009, but only thanks to deals with its creditors and a deal to sell equipment to a Chinese automaker. READ (3 COMMENTS) »
Taxes on tourists 'illogical'
A tourist who takes a guided wildlife tour in Sweden pays four times as much tax on his or her ticket as a tourist who visits a zoo. Illogical, says an organization promoting eco-tourism in Sweden. READ »
Pirate Bay co-founder banned from running site
One of the co-founders of The Pirate Bay, Peter Sunde, has been banned by Stockholm district court from continuing to run the filesharing site. READ (2 COMMENTS) »
- 23/07 Truckmaker Scania posts surprise Q2 results »
- 23/07 Ericsson Q2 sales disappoint, shares drop »
- 22/07 Volvo Trucks posts surprise Q2 profit »
- 22/07 ABB Q2 earnings fall, but issues upbeat guidance (1 comment) »
- 21/07 Nordea Q2 profit falls, issues mixed outlook »
- 21/07 Entrepreneur inflation expectations drop: poll »
- 20/07 TeliaSonera Q2 profits rise as expected (1 comment) »
- 20/07 Swedish growth to slow in 2011: IMF (2 comments) »
- 19/07 Free paper publisher Metro sees losses shrink »
- 19/07 Electrolux posts record second-quarter profit (1 comment) »
"Why is this rich man in an expensive suit standing on my president's front lawn and calling me a vertically-challenged gnome? " READ »
- 18/2 08:56 Ryanair – when the going gets tough, will the tough get going?Like all empires, Ryanair's will come to an end, but like a old punch drunk prize-fighter, will they see the upper cut before it is too late? READ »
- 05/2 16:37 Stockholm garbage collectors – an overpaid relic of a bygone age?There is a school of economic thought that opposes the CBA because it creates an insider-outsider workforce, raising wages for those with an over-protected job and levels of unemployment for those without. It is just one side of the argument and there are strong ones available to counter it, but a clearer example of the validity of this thesis is surely hard to find. READ »
| 30/07 | Spanish speaking technical support StudentWork Finndea AB |
Stockholm |
| 30/07 | Area Sales Manager (m/f), Stockholm REGUS |
Stockholm |
| 30/07 | Regional Sales Manager Mercuri Urval AB |
Gävle |
| 30/07 | Customer Support with Danish Monster Worldwide |
Brno |
| 30/07 | KEY ACCOUNT MANAGER Michael Page |
Stockholm |
| 30/07 | Norwegian speaking technical support StudentWork Finndea AB |
Stockholm |
| 30/07 | Regional Sales Manager Mercuri Urval AB |
Eskilstuna |
| 30/07 | Lawyer Structured Finance / Project Finance European Investment Bank |
Luxembourg |
| 30/07 | Recruitment Consultant Michael Page |
STHM |
| 30/07 | Regional Sales Manager Mercuri Urval AB |
Stockholm |
- 30/07 Retail sales drop for June as consumers remain cautious »
- 30/07 Audi looks to China for sales records as price war brews »
- 29/07 VW quadruples profits, beating forecasts »
- 29/07 'Job miracle' stalls as unemployment rises in Germany »
- 28/07 Reclusive billionaire co-founder of discount chain Aldi dies at 88 »
- 28/07 Green BMW ad slammed as 'misleading' »
- 27/07 Consumers join businesses in party mood »
- 27/07 Deutsche Bank posts higher quarterly profit »
- 26/07 Love Parade organiser owns fitness chain McFit »
- 26/07 Summer retail clearance sales officially begin »
- 21:31 I saw Jesus riding my stolen bike
- 21:30 Buying/Selling shares in other EU countries.
- 21:23 Restoring my Virginity for my Marriage
- 21:15 10K Jogging Paths in Stockholm?
- 21:10 The Obama Deception
- 20:58 WELCOME to Sweden!
- 20:51 Little problems to solve in my new home in Sweden
- 20:24 God-Bashing in Sweden
- 20:17 DCS BLACK SHARK! ROCKS!
- 20:07 Bringing UK car to Sweden
We are a field hockey team in Stockholm. Having an international squad we are looking for guys and girls who are interested in playing and having fun.
MORE INFO
The Local is seeking a talented Web Developer with both back-end and front-end skills
FULL JOB DETAILS
Beth Rogerson PhD - Clinical, Marriage & Family Therapist
Click or call 08-5580 1266 now
The Local is seeking talented and experienced media sales professionals for our online advertising sales in Sweden
FULL JOB DETAILS
Find products and services that are specifically focused on English speakers living in Sweden!
FULL DETAILS
A perfect location both for business and pleasure. Centrally located, with atmosphere.
www.adlon.se
Visit Stockholm's beautiful archipelago. Great boat tours for all preferences.
MORE INFORMATION
Therapy in English
David Schultz PsyD
Individuals & couples
In Stockholm in person or by phone or video conferencing
www.anxiousorblue.se
Great nature, food and genuine Swedish culture.
Read more about Västervik
Rapidly growing 300 million dollar debt free company expanding into Sweden looking for high performers with incredible leadership skills, focus and drive. Unlimited income potential.
FULL JOB DETAILS
Your comments about this article:
The comments below have not been moderated in advance and are not produced by The Local unless clearly stated. Readers are responsible for the content of their own comments. Comments that breach our terms and conditions will be removed.
Who is up for a Chinese built Volvo.
It si unfortunate that some Sweden people in the goverment did not grow a backbone and get swedish investers to purchase volvo and keep it in Sweden.
There goes a large amount of Sweden's manufacturing base.
This is bad for all of europe.
Big shame.
TBH, i wouldn't trust a Chinese media report if i was paid to.
And AFAIK there isn't a "new" XC90.
Precisely!
No such reports in Swedish media that have searched! It's all about a report published on Wednesday in the National Business Daily.
Deary me, the local need to check their sources more thoroughly, first the Air France crash photos, now this. Next thing we know they'll be quoting The Dandy and Marvel Comics as reliable news sources, or the Daily Mail.
Just need Kindman to start writing articles about social and religious tolerance, Liveman on the finance and immigration section and the rest of the nutjobs to choose their reporting niches now...
I think someone mentioned bringing SAAB closer to Asia yesterday in the Koenigsegg thread. To that I say, "why?" Why would anyone subject proprietary material to the masterminds of reverse-engineering?
1. "Only european people know how to make european standard cars." - err....one word...Japan. Oh sorry, by "European" you meant "inferior to the Japanese cars", right?
2. So many clichés about quality - no wonder Asians hate us in Europe. Get a grip. Europe has become lazy in the last decades and it needs to watch out - India and China are overtaking us. Rapidly.
4. "Sweden is famous for its Volvo and Blondies, I am glad we still have the blondies." - firstly, Vovlo is owned by Ford anyway. Secondly, what do you get if you turn 5 Swedish blondes upside down? On average three brunettes......or four baldies.......either way, it makes the point - stereotypes are often inaccurate.
5. Report just been denied by both Volvo and Ford? Good! Fewer racial sterotypical, knee-jerk reactions on The Local. Hurrah!
Trevlig midsommar. Try not to kill the små grådorna in your american cars......
- I hope for your sake that this is a mis-quote Maria, otherwise with this kind of attitude, it is no wonder that Volvo is no longer an independant entity.
Maybe Geely are being used as pawns in a high stakes negotiating game with another (as yet unannounced) buyer?!?
Maybe this will force a close to the deal (finally!) with a better long term backer ... the uncertainty must be painful for Volvo workers, unions, Gothenburg regional politicians etc
Just like Buick is so popular in China, but stays there and BMW's are prevalent in South Africa and China. A few years ago, I personally suggested that Saab look to India and Chine to expand the brand, especially to make the brand more competitive in Europe and the USA. Also the Chinese will lead the push towards electric car technology, which will be especially good for Volvo.
Peter Gilbert
Let's look at the consumer base. How many people buy Volvos because they are accessible and affordable? How many people buy Volvos because of the quality and safety features (in other words - willing to invest a considerable amount of cabbage for a greater return)?
Maybe Chinese manufacturers are attempting to broaden their horizons, but I highly doubt it given the amount of crap that flows into my inbox from the CPSC on a daily basis.
Dont worry about the jobs..It eventually passes on to the nations who are good in doing it...Remember, The World Trade Model....Now why are we afraid when China is taking advantage of the lower world trade barriers.
BRIC is emerging. If you go to China, people there are working hard and changing fast. In big cities, the middle class can afford even a new BMW.
1) Quality, accessibility and affordability of Volvos (past, present and future)
2) Consumer expectations
3) Typical Chinese output
If Volvo is sold to Chinese manufacturers, it is only natural for the average consumer to wonder what sort of quality metrics will be adhered to. It's not the consumer's fault that Chinese goods are considered substandard in certain markets. I'm sorry if you find the obvious and proven offensive, but that's the sad fact of the matter. Between piss poor production standards and quality standards which are beyond inconsistent, anyone who falls into the category of high consumer expectation has good cause for concern.
FWIW - I cannot, even if they were given away free, get any of my hospitals to transition to a certain patient slipper, manufactured in China, because of quality and safety issues. These facilities would sooner pay double the price than risk a patient fall due to shoddy workmanship, raw materials, etc...
Expat, how are European cars "inferior" to Japanese cars?
Japan is great because of the MASSIVE transfer of western technology in the past, technology that the Japanese did not have to develop themselves.
I have a classic Mercedes from which the engine was copied to use in the famous Datsuns, very typical.
Look how fast Korean manufacturers rose; they were still building Korean branded cars copied from licensed European models 20 years after they came out in Europe.
Early in the 20 century the Japanese were even buying complete buildings in Europe and shipping by barge to Japan.
Same thing with China, they will buy Volvo, take and master the technology, put it into their own cars and sell it back to idiot Europeans and Americans for half price.
However the time may not be too far away, in which case it will probably signal the end of the line for all mass produced European and American cars.
Let's be leaders in the Next Big Thing, and not get hung up on the past.
The returns on capital among automakers, even in good years, are generally mid-single figure percentages ... hardly worth the effort
The real money in automotive is made by patentholders of key components used by mass market and luxury volume produced vehicles ... doesn't employ so many people but is the big wealth/profit generator ...
When we analysed this at business school ... Italy and the UK emerged as centres of European excellence for auto component innovation (largely as a result of Formula 1 racing research and the large number of specialist sports and supercar manufacturers) ... instead of the intuitive expected German/French domination given their much larger auto manufacturing base!
Let the 3rd world screw the components together ... let the west concentrate on design, marketing and component innovation (particularly green tech) and re-absorb their workforces in more interesting/value-added sectors of their economies
There is quite a lot to be said for it.
The Koreans in particular are able to make cars with a very high degree of reliability,possibly the most important factor,by using very well proven working parts,hence they are able to offer 5,7,or even 10 year guarantees,something not to be sniffed at.
Its ok to be at the cutting edge of technology as in Germany's case.
However even after much testing this does not always guarantee reliability.
Quite a few faults only show up after a few million cars have come of the production line.
I have had problems myself and driving the full length of Europe quite often I have to say that I see more German cars stranded than any others, whilst it is very rare to see a car from the Far East stuck on the roadside.
Taking into account the exceptionally high cost of spares and repairs, in addition to possible inconvenience with the German and also some recent Swedish models, I buy from the East every time now.
Hardly worth paying twice the price just to get away from the lights a fraction quicker, or whatever the latest refinement might be, and losing out big time on reliability, maintenance and overall cost.
Maybe,Maybe Not.
Three likely scenarios.
4 or 5 years on....
1.They struggle under the massive burden of debt,cant pay their way and go under, and as SR suggested become simply a supplier of spares,...the Saab logo is sold cheaply to some other company,in the hope it lives on.
2.They restructure on a much reduced scale and have some success with one or two prestige models.By this time the recession is over and its boom time again,however the profit margins are wafer thin and they are still in debt.
They are eyed up and then swallowed up by one of the big Japanese giants or a newly emerged Chinese or Indian giant.
3.By some miracle they have managed to pay off most of their massive debt and the now smaller restructured company is turning out new popular high quality prestige models that have exceeded all expectations and will remain Swedish or at least Scandinavian.
Place your bets.
A leak; followed by no comments; and then an annoucement a short while later.
The only difference so far is that Volvo PR team are saying some wacky things: "Ford is in charge of the sale. We don't know anything here," said Volvo's Maria Bohlin - and I bet she did't get a pat on the back for that quote.
China is cuttently getting rid of US$ reserve, like Russia and Iran alike.
http://www.globalresearch.ca/index.php?context=va&aid=13997
So, I totally back China to buy Volvo, American assets outside the USA. This is the smart thing to do: buy buy buy american assets outside the USA before it collapse.
Life is beautiful!
My other car is a Jaguar .
Will an owner like Geely really care about what is good for Volvo, its employees and Sweden?
I very much doubt it - I think they would be more interested in getting hold of technology and moving production to China. . . Chinese ownership will destroy a good brand!
With access to Western markets, Western technical guidance with regard to the quality of their product and highly competitive prices they could virtually wipe out the Western Auto industry in a short space of time.
Remember the first Japanese rust buckets on wheels that came into Europe.
It didnt take them too long to get their act together either.
Every dog had it,s day as the saying goes. While a lot of complacent europeans think it is still their day.......a huge, hungry for development Chinese nation is growing out there that has potential far exceeding what Japan achieved.
We Europeans are good at stuff, but it does not mean this trait belongs purely to our nations. It wont take long either.
The US will also be knocked a few notches down very very soon.
They do not have the technical know-how nor any global brands to speak of. They have been making cars for a while but they are substandard in comparision to western vehicles and far below European standards.
What they have got is financial backing from a communist government and a capacity to manufacture cheaply. They can do this because they do not pay western wages, benefits, or have the same heath and safety costs.
2. Chinese compay will buy it even you all are not satisfied.
Businessweeks take is that Swedish Volvo executives made critical errors in recent years fighting Ford management on diversifying production away from Sweden as a currency hedge and for cost control.
They add that Volvos 'safety' premium has been eroded by improved safety standards in competing brands, and that styling has lagged competitors ... at the price charged in the marketplace by Volvo ... they simply couldn't sell enough vehicles to cost-cover
Blind economic nationalism rarely sits side by side with robust profitability ... if Volvo weren't chronically loss making the Swedish management could pick and choose from a wide range of potential buyers ... even in this economic climate ... instead of being out with a begging bowl ...
If and when a deal is done, Volvo management could and should be facing a lot of awkward questions