Ford sells Volvo to Geely (Chinese Automaker)
03-28-2010, 10:23 AM
#1
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Ford sells Volvo to Geely (Chinese Automaker)
Link: http://www.autoweek.com/article/2010...NEWS/100329890
Ford has reached an agreement to sell its Swedish brand Volvo to Chinese carmaker Geely for about $1.8 billion in a multinational sale expected to close in the third quarter of this year.
The pending agreement was announced Sunday morning, and Ford will continue to supply powertrains, stamping and other parts to Volvo after the sale. If it closes, the landmark deal delivers the premium Volvo brand--long a benchmark for automotive safety--to a Chinese firm that has ambitious plans for growth. The sides have been working toward a deal since last October, and said in December they expected to announce progress in the early part of 2010.
Ford will get most of the money from the sale in cash, and can use the money to concentrate on its core Ford division. The company said the cash amount may change at the closing. The deal also includes an agreement over intellectual property. Volvo will maintain its manufacturing base in Sweden and Belgium, as well as its Swedish headquarters. Geely is planning for a factory in Beijing to build 300,000 Volvos for the Chinese market, Reuters reports.
Impact on Enthusiasts
Volvo's product line is getting a major upgrade with the launch of the redesigned--and handsome--2011 S60 sedan. The flagship car was revealed at the Geneva auto show, and is expected to bolster Volvo's efforts in the premium four-door segment. It's aiming for sales of about 90,000 around the world. The S60 will take aim at the BMW 3-series and the Infiniti G35, among other luxury sedans.
Doug Speck, Volvo's North American CEO, told AutoWeek last fall the company is planning diesel and electric powertains for the U.S. market, and developed the S60 with enthusiasts in mind. He also left open the possibility of a R performance badge returning; Volvo currently uses R-Design as an appearance package.
“We need people to say, ‘I actually enjoy driving a Volvo,'” Speck said.
Volvo also showed an electric C30 in January at the Detroit auto show. It says it plans to make a test fleet of 50 battery-powered C30s for a two-year trial starting in 2011.
“Volvo is a great brand with an excellent product lineup, “Alan Mulally, Ford CEO, said in a statement. “This agreement provides a solid foundation for Volvo to continue to build its business under Geely's ownership.” At the same time, the sale of Volvo will allow us to further sharpen our focus on building the Ford brand around the world.”
The agreement positions Geely, known formally as Zhejiang Geely Holding Group Company Limited, to accelerate its growth. The burgeoning Chinese market passed the slumping U.S. market in sales last year. Geely was founded in 1986 and has its headquarters in Hangzhou, China.
“China, the largest car market in the world, will become Volvo's second home market,” Geely chairman Li Shufu said in a statement. “Volvo will be uniquely positioned as a world-leading premium brand, tapping into the opportunities in the fast-growing China market.”
Read more: http://www.autoweek.com/article/20100328/C...0#ixzz0jUrn29pn
Ford has reached an agreement to sell its Swedish brand Volvo to Chinese carmaker Geely for about $1.8 billion in a multinational sale expected to close in the third quarter of this year.
The pending agreement was announced Sunday morning, and Ford will continue to supply powertrains, stamping and other parts to Volvo after the sale. If it closes, the landmark deal delivers the premium Volvo brand--long a benchmark for automotive safety--to a Chinese firm that has ambitious plans for growth. The sides have been working toward a deal since last October, and said in December they expected to announce progress in the early part of 2010.
Ford will get most of the money from the sale in cash, and can use the money to concentrate on its core Ford division. The company said the cash amount may change at the closing. The deal also includes an agreement over intellectual property. Volvo will maintain its manufacturing base in Sweden and Belgium, as well as its Swedish headquarters. Geely is planning for a factory in Beijing to build 300,000 Volvos for the Chinese market, Reuters reports.
Impact on Enthusiasts
Volvo's product line is getting a major upgrade with the launch of the redesigned--and handsome--2011 S60 sedan. The flagship car was revealed at the Geneva auto show, and is expected to bolster Volvo's efforts in the premium four-door segment. It's aiming for sales of about 90,000 around the world. The S60 will take aim at the BMW 3-series and the Infiniti G35, among other luxury sedans.
Doug Speck, Volvo's North American CEO, told AutoWeek last fall the company is planning diesel and electric powertains for the U.S. market, and developed the S60 with enthusiasts in mind. He also left open the possibility of a R performance badge returning; Volvo currently uses R-Design as an appearance package.
“We need people to say, ‘I actually enjoy driving a Volvo,'” Speck said.
Volvo also showed an electric C30 in January at the Detroit auto show. It says it plans to make a test fleet of 50 battery-powered C30s for a two-year trial starting in 2011.
“Volvo is a great brand with an excellent product lineup, “Alan Mulally, Ford CEO, said in a statement. “This agreement provides a solid foundation for Volvo to continue to build its business under Geely's ownership.” At the same time, the sale of Volvo will allow us to further sharpen our focus on building the Ford brand around the world.”
The agreement positions Geely, known formally as Zhejiang Geely Holding Group Company Limited, to accelerate its growth. The burgeoning Chinese market passed the slumping U.S. market in sales last year. Geely was founded in 1986 and has its headquarters in Hangzhou, China.
“China, the largest car market in the world, will become Volvo's second home market,” Geely chairman Li Shufu said in a statement. “Volvo will be uniquely positioned as a world-leading premium brand, tapping into the opportunities in the fast-growing China market.”
Read more: http://www.autoweek.com/article/20100328/C...0#ixzz0jUrn29pn
03-28-2010, 10:42 AM
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Hate to see it but I don't blame Ford for wanting the cash. Also, it perhaps will help Ford concentrate on fixing Lincoln. They seem to have a good handle on the "Ford" label stuff. Mercury for the moment is slightly nicer Ford. Now we need Lincoln to be something other than slightly nicer than Mercury!
Thanks for the link!
Thanks for the link!
03-28-2010, 05:59 PM
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Originally Posted by Steponme,Mar 28 2010, 12:38 PM
Big surprise! In a couple of years, China will be the world's biggest automobile market; it was only a matter of time before they started buying up foreign makers.
03-29-2010, 07:14 AM
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The thing to watch for is whether Volvos will continue to evolve or if they will be using the same tech in 5-8 years that they are using today. Personally I think the Chinese and Indian purchases of Western makes is a great way for them to get up to speed on modern car building, but will they be able to advance upon it?
I have a Lenovo Thinkpad, before it I had an IBM Thinkpad. The new laptop is a bit more cheaply made, you can see the cost cutting, battery life is worse, and other than the upgraded processor and graphics, its pretty much the same computer. makes me wonder if cars will be the same.
I have a Lenovo Thinkpad, before it I had an IBM Thinkpad. The new laptop is a bit more cheaply made, you can see the cost cutting, battery life is worse, and other than the upgraded processor and graphics, its pretty much the same computer. makes me wonder if cars will be the same.
03-29-2010, 07:23 AM
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Originally Posted by Saki GT,Mar 29 2010, 10:14 AM
I have a Lenovo Thinkpad, before it I had an IBM Thinkpad. The new laptop is a bit more cheaply made, you can see the cost cutting, battery life is worse, and other than the upgraded processor and graphics, its pretty much the same computer. makes me wonder if cars will be the same.
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03-29-2010, 07:48 AM
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I don't think the Chinese want Volvo for the brand. I think they want Volvo for the knowledge and expertise. It's much easier for them to buy that knowledge than develop it on their own.
03-29-2010, 09:01 AM
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Originally Posted by airgate,Mar 29 2010, 07:07 AM
We'll soon see obese Chinese men and women...just like America.
maybe we'll start to see more skinny americans too! 
