Olofsson happy with Geely Volvo assurances
Published: 21 May 10 10:47 CET | Print version
Online: http://www.thelocal.se/26772/20100521/
Sweden's enterprise minister Maud Olofsson has discussed the Volvo-Geely deal with senior Chinese management and received confirmation that the firm plans to retain its Swedish connection and maintain production in the country.
- Geely reveals Volvo China production plans (1 May 10)
- Geely comments raise doubts over Volvo buy (13 Apr 10)
- Geely sets Volvo sights on Chinese luxury market (31 Mar 10)
"They think that Geely should make major investments in Sweden and there is nothing to suggest that they are going to move everything to China, nothing - in fact they underlined that the brand is strong due to its links to Sweden," Olofsson told news agency TT in Beijing.
Olofsson underlined the Swedish government's position to the NDRC that it is expected that research and production would remain in Sweden even after Geely's purchase of Volvo is completed in the autumn. She underlined that she had informed Geely about Swedish law and the role of the trade unions.
"I have been given the impression that they are very conscious that this is going to be a positive deal and that Geely acts in a decent way in Sweden," Olofsson said.
China is the world's largest car market with 10.9 million cars sold in the country in 2009, up 53 percent on the previous year.
The Chinese car market is expected to expand by 15-17 percent in 2010. Volvo already manufactures its S40 and extended version of the S80 in China but in order to penetrate the market further, production in China needs to increase. According to recent reports Geely plans to build a new Volvo factory in Chongqing, near Beijing - or in western China.
Olofsson explained that she was unable to comment on the proposed plans.
"This is something that the firm has to answer. But I have said all along that if we are to reach out to the Chinese market then cars also need to be produced in China," she said.
What do you think? Leave your comment below.
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| 22/05 | Accounting ManagerMichael Page | Göteborg, VTG |
| 22/05 | Analyse Engineer - Infotainment PlatformVolvo | Göteborg |
| 22/05 | Analyse Engineer - Infotainment PlatformVolvo Car Corporation | Göteborg, VTG |
| 22/05 | Application Owner AXNet Entertainment NE AB | Stockholm |
| 22/05 | Architectural Engineer #8409Aker Advantage | Stockholm |
| 22/05 | Business Developer/Account ManagerTransPerfect Translations | Stockholm, STHM |
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That is all anyone needs to focus on in this story. Everything else is smoke and mirrors.
People have to keep in mind that the investers will not and never give up any strategies to make their business grow and profit. What are the commentators above worried about? the employment or what? so work hard and smart for the new change!
It is hard to work hard and smart if your job has been eliminated because Geely can hire 5 Chinese workers in China for the price of 1 worker in Sweden. As you said, no investor will eliminate an option to grow and profit. Profit margins are what drives a company's bottom line and not loyalty to country and brand combinations. Volvo manufacturing in Sweden is in the twilight of it's existence. Just wait and see.
Volvo will be exceptionally succesful in China. Volvo in Sweden will serve as a conduit for high-tech engineering into Chinese industrial and military power. You can kiss your high end manufacturing jobs good bye. It may take five to ten years, but it is over.
Politics trumps economics. Germany and Britain were each other's number one trading partners, but still tore each other to shreds in war. Similarly, China will push the US too far. War over control of the Pacific will ensue. Even if the combat does not go nuclear, the internation trade regime will be shattered.
Too bad for everyone. Human beings are only imperfectly rational.
I think China today has somewhat the psychology of late 19th century Germany. Germany felt that it had been denied its "place in the sun" by the machinations of Britain and France. China feels as though she had been exploited and oppressed by foreigners since the Opium Wars and is now regaining her place as the Middle kingdom- the center of civilization.
It's nothing short of astonishing that China modernised in 30 years, instead of 300. My view is that both civilizations could learn plenty from each other. The commitment for peace has to be total.
Hey, the jibe about England and Germany tearing each other apart is a little cheap. England and the US tore Germany apart because someone in Germany decided that the best place for ethnic minorities was in a gas chamber. Have they changed the history coriculum in Sweden as well to only include the "acceptable" past?
Maybe China is just getting back at European nations because of the opium wars. Hasn't anyone told the Chinese government yet that we handed back Hong Kong in the last century.
There is no hard evidence that Geely, a rather amazing company by chinese standards, will behave in some of the pessimistic ways predicted here.
Even if they did - did Swedes want to buy Volvo? Nope!
Li Shufu managed to turn a couple of thousand $ in the 80's into the first independent and largest private automobile manufacture in China. Maybe if Volvo is willing to take the ride with this remarkable man, it just might turn out to be something better than the predictions of doom and gloom that so many seem to enjoy.