Volvo to go to the Chinese??

[vztrt]

Seems Beijing Auto is biding on Volvo after no luck with Opel.

http://business.theage.com.au/busine...0611-c47j.html

Chinese car maker eyes Volvo
June 12, 2009 - 11:03AM

Beijing Automotive, a closely held Chinese car maker, may bid for Ford's Volvo unit, according to a person familiar with the discussions.

Beijing Auto, which failed in a bid last month for General Motors' Opel business, is expected to send executives this week to Volvo's Gothenburg, Sweden, headquarters, said the person, who did not want to be identified. The Chinese delegation is to tour Volvo's factories and review its books, the person said.

Ford is shedding its international luxury marques to focus on rebuilding its namesake brand. Last June, the second-largest US car maker sold UK-based Jaguar and Land Rover to India's Tata Motors for $US2.4 billion. Ford sold its Aston Martin line for $US931 million in May 2007 to a group of investors.

"There are a number of interested parties and there are continuing discussions," said John Gardiner, a Ford spokesman based in Germany. "It will take some time to unfold."

Geely Holding Group, China's biggest closely held car maker, remains the front-runner among companies interested in acquiring the Swedish car maker, said the person familiar with the process. Geely executives toured Volvo's factories and reviewed its books in April, the person said.

Geely made its interest in Volvo known to Ford a year ago, before the Dearborn, Michigan-carmaker put its Swedish unit up for sale, people familiar with the matter have said.

$US2 billion price tag

Ford is seeking about $US2 billion for Volvo, less than a third of what it paid for the maker of sedans and station wagons a decade ago, two people familiar with the process have said. Ford, the only major US car maker not in bankruptcy, is seeking to raise cash to avoid requesting government assistance. In December, the car maker put Volvo up for sale as the brand's US sales slid 31 per cent.

Beijing Auto, which has joint ventures to make vehicles in China for Hyundai and Chrysler's Jeep, submitted a letter of interest in GM's Opel unit May 21, a day after the deadline for bids, people familiar with the proposal said at the time. GM and the German government selected Magna International, one of the three original bidders, on May 29.

Beijing Auto's interest in Volvo was reported earlier by the Wall Street Journal.

Bloomberg

[Mark351]

Might help make some chinese cars that crash well...

[vztrt]

Car advice article

http://www.caradvice.com.au/32612/be...-to-buy-volvo/

First it was MG then HUMMER and now Volvo looks like it’s heading to the land of Dragons and Emperors with Beijing Automotive Industry Holding Corporation announcing its interest in buying Ford’s Swedish Volvo car unit.

Beijing Auto is China’s fifth-largest carmaker and earlier this month also expressed interest in buying Opel, but no deal eventuated from that. Even if Beijing Automotive does not go through with its intentions, at the moment it seems very likely that Volvo will be sold to a Chinese company regardless.

So far Geely Automobile Holdings, Ford’s China partner Chongqing Changan Automobile Co., and Chery Automobile have all shown interest in taking Volvo from Ford. Volvo has had little to say about all the speculation: “Ford has said it is a process ongoing, but they haven’t disclosed any names.” Stefan Elfstrom, spokesman for Volvo Cars said.

Beijing Auto currently only manufacturers Mercedes-Benz and Hyundai Accent cars with a joint ventures with Daimler AG and South Korea’s Hyundai Motor.

“(Beijing Auto) doesn’t even have a in-house design car brand so far. How can anyone realistically expect it to take over and turn around Opel or Volvo?” an anonymous source told the Us industry publication Autonews.

We do have to wonder what the future holds for Volvo?

[vztrt]

China’s Geely Motors to purchase Volvo – report

http://www.caradvice.com.au/35575/ch...-volvo-report/

China’s Geely Motors to purchase Volvo – report

A new report from the US today has indicated China’s Geely (Motors) Holding Group is expected to finalise a US$2 billion offer this week to purchase Volvo from Ford.

According to the report published in the Wall Street Journal, Geely’s move to buy Volvo stems from a January 2007 discussion between Don Leclair, then Ford’s chief financial officer, and Geely chariman Li Shufu.

If the move goes ahead Geely could “slash the brand’s costs by taking advantage of lower product development and manufacturing costs available in China”.

Although speculative at best, the move is quite feasible given Geely’s positive financial position and prior interest in the brand.

Either way CarAdvice will be sure to keep you posted on any developments.

[ltd]

With all these brands and marques being sold off, we could end up with Ford being the only cars not made in Asia. I wonder who's going to buy Porsche, maybe Kia.

[vztrt]

Originally Posted by ltd

With all these brands and marques being sold off, we could end up with Ford being the only cars not made in Asia. I wonder who's going to buy Porsche, maybe Kia.

VW is trying to take them over at the moment.

[ehast13]

What a shame. The volvo/mazda/ford relationship was a beauty.

[vztrt]

Geely’s procurement of Volvo almost over

http://www.chinacartimes.com/2009/08...o-almost-over/

Geely’s procurement of Volvo almost over

From China.org.cn

Geely’s procurement of Swedish auto giant Volvo is approaching the final stage, the National Business Daily learned from Sweden. Volvo and its owner Ford Motor Company are expected to make the final approval as early as this month.In addition to Geely, which will get the majority of Ford’s stake in Volvo, a Swedish company will also acquire the remaining shares. Meanwhile, Ford will keep 10-15 percent of its presence in Volvo for the following 7-8 years, in order to facilitate the launch of new Volvo models.Ford plans to sell Volvo at around 20 to 25 billion Swedish Kronas (US$2.528 billion to US$3.159 billion), of which Geely will pay 15.6 billion Swedish Kronas.Previously, the Volvo Engineers Union had expressed dissent about the deal and wished for a European owner instead of Chinese Geely, an opinion also shared by higher officials in the Swedish government. However, Ford’s “package sale,” which involves a local Swedish company, greatly eased the dissent.Some experts told the National Business Daily yesterday that Geely’s boss, Li Shufu, will not merge the two companies, but will keep Volvo’s operation independent.Regarding Volvo’s XC90 manufacturing site in China, insiders from Geely mentioned that both Dong Guan in Guangdong Province and Tianjin Municipality are likely places. However, rumours spread earlier this month saying Beijing and Bazhou in Hebei Province may also be the host for the Swedish vehicles.

Obviously the Chang’an-Volvo JV is expected to stay on track, at least for the short term, but eventually it will probably be terminated and become a Geely-Volvo JV. Geely’s purchase of Volvo is expected to give it a huge technology boost over its Chinese competitors and an excellent pedigree brand. Geely CEO, Li ShuFu is the next Bill Gates.

[Teflon Turbo]

is this some kind of joke? volvo drivers are bad enough as it is.

[ltd]

Maybe the Chinese will learn something about how to build safe cars that get beyond half a star in ANCAP. Maybe if they become nationalistic the Toyota Camry's dominance amongst the Chinese community will come to an end, and they'll all buy Chinese built XC90's.

[XRtowcar]

"Its the end of the world as we know it". REM.
Cant see any reason to manufacture cars in OZ after the Chinese get up to speed.
Replace the crap product with some better built and designed cars and the lower production costs will wipe out a large percentage of auto manufacturing just about everywhere.

[Ghiadude]

Originally Posted by XRtowcar

"Its the end of the world as we know it". REM.
Cant see any reason to manufacture cars in OZ after the Chinese get up to speed.
Replace the crap product with some better built and designed cars and the lower production costs will wipe out a large percentage of auto manufacturing just about everywhere.

YEP. How long before the car companies realise that the same thing can be built elsewhere for a fraction of the cost. IMHO it wont happen en masse untill the Germans do it.

[ltd]

Originally Posted by Ghiadude

YEP. How long before the car companies realise that the same thing can be built elsewhere for a fraction of the cost. IMHO it wont happen en masse untill the Germans do it.

Spot on, but even that won't be too far away.
Aren't some BMW's being built under licence in China? I know some VW's are.

[vztrt]

Originally Posted by ltd

Spot on, but even that won't be too far away.
Aren't some BMW's being built under licence in China? I know some VW's are.

Merc did move their operations to Asia but after their warranty claims sky rocketed that was quickly reversed.

[ltd]

Originally Posted by vztrt

Merc did move their operations to Asia but after their warranty claims sky rocketed that was quickly reversed.

Thanks mate, couldn't quite recall.

[Teflon Turbo]

now, as some of you know i get stuff wrong alot and that's only coz i don't cross referrence my memory with wiki, googles or any internet search type knowledge thingy.

i just use old school knowledge handed down to me from edumacation, but from memory volvo was the first company to make a rolling bearing which then turned into skf (aka swedish ballbearing factory)

the word volvo means "i roll" and then they started making cars.

dunno, thought i would share some trivia with yas

[vztrt]

Geely the only offer for Volvo.

http://www.caradvice.com.au/39733/ch...e-after-volvo/

China’s Geely only one after Volvo?

With Jaguar Land Rover sold to India’s Tata, Ford’s attempts to lean up even further and go solo are still in progress. However the sale of Volvo is proving to be a little more challenging than originally thought.

According to newspaper reports in Sweden, China’s Geely Automotive is currently the only company to have submitted a valid offer for Volvo. The Swedish brand has been losing money for some time and was put up for sale by Ford more than nine months ago.

The blue oval is expected to announce which suitor it has chosen to begin final takeover negotiations with some time this month and the hand over should be finalised before the year’s end.

[vztrt]

U.S.-led consortium wants to buy Volvo from Ford

http://www.easybourse.com/bourse/act...3708600-740290

U.S.-led consortium wants to buy Volvo from Ford: report

LONDON (Reuters) A U.S.-led consortium has entered the race to buy Volvo from Ford <F.N>, the Financial Times reported, in a challenge to China's Geely Automotive <0175.HK>, which confirmed its interest in the money-losing Swedish carmaker last month.

Citing people close to the sale, the FT said the Crown consortium has fully secured financing from U.S. private equity groups. But the consortium is also seeking additional backing from Swedish investors to signal its intent to keep Volvo in the country, according to the FT.

The Crown consortium is fronted by former Ford director and turnaround specialist Michael Dingman and former Ford and Chrysler executive Shamel Rushwin, the people told the FT.

The FT reported another informed person as saying the U.S. consortium had offered significantly less than Hong Kong-listed Geely, but that both plans involved similar plans for more than $3 billion of additional investment in Volvo.

The FT quoted a person close to the sale saying Geely had offered just less than $2 billion for Volvo. Other media reports have put the price tag at around $2.5 billion.

A Ford spokesman was not immediately available for comment.

A Saab spokeswoman declined to comment.

(Reporting by Jon Carter; Editing by Jan Paschal)

[Bossxr8]

From the above article.

"A Saab spokeswoman declined to comment"

Is anyone suprised, considering its Volvo and not Saab being bought out. :

[vztrt]

Dealers sweat on Volvo sale resolution

http://www.goauto.com.au/mellor/mell...257651001BC21F

Volvo workers, dealers get on with business in shadow of Ford’s sale talks limbo

16 October 2009

By RON HAMMERTON

VOLVO employees and dealers are anxious to know the outcome of Ford’s negotiations to sell the Swedish company, according to a leading Volvo executive on a visit to Australia.

Volvo Car Overseas Corporation president Lex Kerssmakers said the sale of Volvo – which Ford bought in 1999 but decided to offload late last year – was being handled by the American management team in Dearborn.

Asked if the sale process that has been dragging on for almost a year was a distraction to Volvo operations, Mr Kerssmakers said: “Absolutely. But we are not really involved. We take care of the operational business.

“We try to have as little distraction as possible, but obviously all employees at Volvo and also the dealers are anxious to know what is going to happen.


“It can easily take a few months and we don’t know. That’s why we stress to our employees that whatever happens, whoever the owner is, we need to deliver a sustainable business, so we go on and sell our cars as good as we can.”

Ford is said to be in negotiation with two potential suitors for Volvo – Chinese car-maker Geely Automobile and Crown – a consortium headed by former Ford board member Michael Dingman and former Ford executive Shamel Rushwin.

Geely is reported to have offered Ford $US2 billion ($A2.16b) for the company – about a third of what the Detroit-based corporation paid for it a decade ago.

However, Crown is reported to have offered even less, putting Geely in the box seat should Ford go through with the sale that has been pending since late last year when Ford was reeling from the global economic meltdown.

Both bidders also have offered to contribute several billion dollars to revitalise Volvo once the sale goes through.

Ford hopes to wrap up the sale by the end of this year – a sentiment that Volvo employees and dealers seem to share.

As with General Motor’s sale of Opel, a major sticking point is sure to be the rights to intellectual property.

Volvo has developed several world-first technologies over the years – technologies that an up-and-coming car-maker such Geely would love to buy into.

Mr Kerssmakers, who is the Volvo head office executive responsible for the Australian market along with all other countries outside Europe, the US, China and Russia, said intellectual property rights would probably be negotiated in this final phase of the sale process.

“That’s one of the elements that is probably part of the final package which is all part of the agreement, so I can’t add any sensible comment on that,” he said.

Along with Volvo, Ford has already shed Jaguar, Land Rover and Aston Martin to focus on its core Ford business.

[R-Design]

Originally Posted by 29 October 2009 By RON HAMMERTON

FORD Motor Company has anointed China’s Zhejiang Geely Holding Group as the preferred bidder for its Swedish subsidiary, Volvo Car Corporation.

But Ford cautions that “more detailed and focused negotiations” need to held between the two parties to settle outstanding issues before any deal can be signed.

A major part of those negotiations will almost certainly focus on the thorny issue of intellectual property ownership and access, which has been a sticking point in the sale of other European car companies, including General Motors’ Opel, in the wake of the global financial crisis.

The same issue reportedly also has sent a shiver up Volvo suppliers, who are fearful that a Chinese company might run roughshod over patent rights.

Geely, which is set to begin exporting its own Chinese-made cars to Australia via Perth-based Chinese Automotive Distributors in the first quarter of 2010, is believed to have offered about $US2 billion ($A2.16b) for Volvo – about one-third the price Ford paid for company a decade ago.

Ford has dismissed a reported rival bid from an American-based consortium, Crown, headed by former Ford board member Michael Dingman and former Ford executive Shamel Rushwin.

Ford executive vice-president and chief financial officer Lewis Booth said any prospective sale would have to ensure that Volvo had the necessary resources, including the capital, to strengthen the business and build its global franchise.

“Ford believes Geely has the potential to be a responsible future owner of Volvo and to take the business forward while preserving its core values and the independence of the Swedish brand,” he said in a statement released from company headquarters in Dearborn, Michigan.

“But there is much work that needs to be completed in the more substantive discussions that are agreed to take place.

“We have no specific timeline to conclude the discussions.”

Ford says it will continue to cooperate with Volvo in several areas after a possible sale, but does not intend to retain a shareholding in Volvo.

John Fleming, chairman of Ford of Europe and Volvo Cars, said: “Ford fully understands the iconic Swedish nature of the Volvo brand and the responsibility we have as Volvo’s custodian to its employees, local communities and other key stakeholders.

“Any sale also would need to take into account the significant connections between Ford and Volvo in terms of continuing component supply, engineering and manufacturing.”

Volvo CEO Stephen Odell said Volvo’s management team welcomed Ford’s announcement as a positive step forward.

“At Volvo, we are continuing to keep our attention firmly fixed on engineering and building great Volvo cars, to reduce our cost base and to return the business to sustainable profitability at the earliest possible opportunity,” he said.

According to a Bloomberg report from Sweden, a Geely-owned Volvo might lose contracts with some suppliers unless the Chinese car-maker promised to protect patents and not plagiarize products in China.

It quoted the head of a Swedish parts industry peak body, FKG – a group representing 300 automotive suppliers – as saying: “Big, tech-heavy suppliers are definitely concerned about China’s record when it comes to copyrights, and Volvo would be in real trouble if it ends up not being being a preferred customer among suppliers.”

Link

[vztrt]

http://www.caradvice.com.au/46373/fo...-volvo-bidder/

Ford names China’s Geely as preferred Volvo bidder

October 29, 2009 by Matt Brogan

Chinese manufacturer Geely Group Holdings is Fords top bidder to purchase Volvo.

Ford will begin more detailed negotiations with Geely, but final decisions have not been made.

“Ford believes Geely has the potential to be a responsible future owner of Volvo and to take the business forward while preserving its core values and the independence of the Swedish brand,” Ford Chief Financial Officer Lewis Booth said in a statement.

Ford has said that although it no longer wants to have shares in Volvo, it would like to continue work with the manufacturer in several areas after the sale.

[vztrt]

http://finance.yahoo.com/news/Ford-p...37690.html?x=0

Ford picks Geely for Volvo cars bid

* On 9:46 am EDT, Wednesday October 28, 2009
By Quentin Webb and Charlotta Kristiansson

LONDON/GOTHENBURG (Reuters) - Ford Motor Co (NYSE:F - News) named Zhejiang Geely Holding Group as preferred bidder for its loss-making Swedish unit Volvo in what could lead to the biggest overseas acquisition by China's fast-growing auto sector.

Ford and privately owned Geely did not disclose a possible sale price for Volvo but media reports have put it closer to $2 billion than the $6.45 billion Ford paid for Volvo in 1999.

The announcement moves the long-running sale, which began in December, closer to a conclusion. Intellectual property concerns, which last week threatened to derail any deal with Geely, may have been overcome.

But it could be months before a final agreement. Ford named Tata Motors (Bombay:TAMO.BO - News) as preferred bidder for Jaguar and Land Rover, its other top-end European brands, in January 2008 and reached a final accord in March of that year.

Ford said it will engage in "detailed and focused" negotiations with Geely, but there was no specific timeline to conclude negotiations. Ford will not retain a stake.

This sale is complicated because Volvo is closely woven into Ford's wider operations, undertaking much of the group's safety work, for example, and Ford said it would continue cooperating with Volvo.

Ford Chief Financial Officer Lewis Booth told a news conference at Volvo's Gothenburg head office that Ford and Volvo needed to make sure the deal contained "appropriate safeguards" and Geely had to undertake more due diligence.

But he said; "We believe that (Geely) have the potential to be a very good owner of Volvo ... they take the heritage of Volvo and the brand of Volvo very seriously indeed."

ENSHRINE INDEPENDENCE

Hangzhou-based Geely said its proposal, financed by Chinese banks, would "enshrine management independence" at Volvo while allowing the Swedish carmaker to source components and tap into sales networks in China.

Volvo would keep existing production and research and development facilities, union agreements and dealer networks, Geely said in a statement on Wednesday.

A Volvo union leader said he was unfamiliar with Geely and had asked to speak to its representatives as soon as possible.

Earlier, Geely had faced competition from rivals including a U.S.-led group including former Ford director Michael Dingman, dubbed the Crown consortium, and Beijing Automotive Industry Holding Corp (BAIC), sources familiar with the matter have said.

Geely is not the only Chinese automaker reaching overseas: the smaller Tenzhong aims to close that deal to buy General Motors's Hummer brand by early 2010.

Frankfurt-traded Ford shares (XETRA:F.DE - News) stood 1.2 percent lower by 1251 GMT, at 4.96 euros a share, outperforming a 4.3 percent drop in the automaking sector (^SXAP - News).

Wednesday's agreement is not with Geely's listed Hong Kong subsidiary Geely Automobile Holdings (HKSE:0175.HK - News).

Citigroup and JPMorgan are advising Ford, while Rothschild is advising Geely.

(Additional reporting by Victoria Klesty; Editing by Douwe Miedema and Marcel Michelson)

[vztrt]

Volvo Australia chief talks up Geely deal

http://www.goauto.com.au/mellor/mell...2576850020DE32

Volvo Australia chief says Chinese buyout would be good news for most customers

7 December 2009

By JAMES STANFORD

VOLVO Car Australia managing director Alan Desselss believes some potential customers might be put off by the prospect of its parent company being sold to Chinese brand Geely, but insists the outcome would likely be overwhelmingly positive.

Ford Motor Company is in the process of selling Volvo to Geely, having declared the Chinese brand the preferred bidder and reportedly signing off on a deal covering the intellectual rights.

Asked by GoAuto if Chinese ownership of Volvo could put some customers off, Mr Desselss said it was hard to tell.

“I think that there might be a reaction in the beginning, but then again Jaguar and Land Rover, they are now Indian owned and does it matter to them? I don’t think so,” he said.

“When Ford originally bought Volvo back in 1998, the world was going to end then and it was all doom and gloom and Ford was actually very good for Volvo.”

Mr Desselss also used the example of prestige brands building vehicles outside Europe and the US.

“Look at Mercedes and BMW and they build cars in South Africa and that was quite tumultuous when they decided to import the 3 Series from there, but now no one cares. As long as it is made by Volvo it has all of the Volvo core values,” he said.

Mr Desselss said Geely appeared to be a good owner for Volvo because it seemed prepared to invest in the brand.

“As long as they do what they say they will do, and that is to invest in the brand and keep the models coming through, then that has got to be a major positive,” he said.

“I couldn’t imagine Geely would buy Volvo and not invest in the products we have got coming; it wouldn’t make sense.”

Mr Desselss said China was the most likely source of an appropriate new owner for Volvo given the current economic climate.

“Who are the people with money at the moment? It (the owner) has got to come out of China, it certainly can’t come out of America, certainly it can’t come out of Europe and probably the only company that could have done it is Tata and they have already committed themselves to Jaguar and Land Rover.”

A Geely buyout would be a positive outcome from the perspective of Volvo dealers in Australia because it would most likely mean they would not lose the franchise to dealers aligned with rival brands.

“Geely do not have an infrastructure, so it means the dealer network is safe, if I can use inverted commas for the word safe,” he said.

“If it was a Renault or a BMW there would be questions about what was going to happen to the dealer network; ‘am I going to lose the franchise?’”

While Mr Desselss said concluding a deal would bring certainty, he said customers did not appear concerned about the likely sale of Volvo.

“I can only go by the sales and they suggest that people don’t care,” he said.

“We are probably going to be stronger than we were last year. We won’t quite get back to our 2007 levels, but we would be pretty close and there are not too many brands around who can say that.”

VFACTS data shows Volvo has sold 4111 cars in Australia to the end of November, compared with 3966 in the same period last year.

After GoAuto’s interview with Mr Desselss, the Wall Street Journal reported that a group led by a former Ford and Chrysler executives submitted a revised bid for Volvo, offering similar money to Geely.

The report said former Ford director Michael Dingman and Chrysler executive were heading up the group called the Crown consortium.

[ZDI-970]

and i thought volvos were already bad! imagine them being made in china were everything is done cheaply and dodgily!

[vztrt]

http://theage.drive.com.au/motor-new...1224-ldr9.html

Ford agrees Volvo sale to Chinese carmaker
December 24, 2009

US auto giant Ford says it has agreed on the main terms for selling its Swedish brand Volvo Cars to Chinese car maker Geely, a deal set to underline China's growing economic clout.

Ford said on Wednesday a definitive accord would be signed early in 2010 with Geely, a former refrigerator parts supplier that has grown into one of China's largest private car makers since launching its car business in 1997.

"Ford Motor Company confirmed today that all substantive commercial terms relating to the potential sale of Volvo Car Corporation have been settled between Ford and Zhejiang Geely Holding Group," Ford said in a statement.

The US company said it expected "a definitive sale agreement will be signed in the first quarter of 2010, subject to appropriate regulatory approvals."

The number-two US car maker said work still remained before finalising the deal, including "final documentation, financing, and government approvals."

The accord marks the first major inroad by a Chinese company into Europe's car industry and would give Volvo access to China, now the biggest car market in the world after the economic crisis hit sales in the United States.

Chinese car makers have launched an expansion drive this year amid upheaval in the global auto industry, with heavy machinery maker Tengzhong agreeing in October to buy the luxury Hummer brand from US giant General Motors.

State-owned Beijing Automotive Industry Holding (BAIC) meanwhile has failed in its bids for GM units Saab and Opel but earlier this month worked out a major deal to purchase the intellectual property rights for some Saab assets.

Ford said the Geely deal would provide Volvo, which employs 22,000 people worldwide, with the resources "to further strengthen the business and build its global franchise."

Geely said in a statement that Volvo would retain its leadership in safety and environmental technologies "should a stock purchase take place."

It also noted that Volvo "will be uniquely positioned as a world leading premium brand to exploit opportunities in the fast growing China market."

According to reports in Swedish media and the Financial Times, the price of the transaction will be around $US2.0 billion ($A2.28 billion), less than a third of what Ford had paid for Volvo in 1999.

Ford, which unlike its US rivals General Motors and Chrysler did not take US government aid to cope with falling sales and managed to avoid bankruptcy this year, had put Volvo up for sale in December 2008.

The biggest question in Wednesday's deal was how Geely was going to manage the image of the Swedish brand, known for its sturdy, high-performance cars, said RL Polk's Bertrand Rakoto.

"It would be better ... that Volvo not take a Chinese brand image, because Volvo is a semi-premium carmaker ... for whom image is very important," the analyst told AFP.

News of a Chinese owner for Volvo was received cautiously in Sweden, where the brand was launched in 1927 and has 16,000 employees.

"There are still many important questions to be resolved and it is a complicated sales process," Swedish Enterprise Minister Maud Olofsson told TT newswire.

The head of a Volvo trade union in the company's western Swedish home city of Gothenburg said it was still unclear how Geely wanted to get the loss-making brand to turn a profit.

"It is still unclear what Geely wants out of this agreement, and that makes me worried," Soeren Carlsson, head of Unionen, told TT.

"Even though our sales are rising, Volvo cars still operates at a loss. How Geely wants to solve that, we don't know," he added.

AFP

[Ohio XB]

Geely may have no intention of "solving" the profit issue at Volvo. They may have just paid $2 billion for the R&D value of now having a quality chassis design and other safety measures. They can just learn from a quality car manufacturer, uninhibited, how to build a good, safe car. This info would be shared with many other car manufacturers in China.


We will see.


Steve


P.S. Ford shares jumped to $10.11 on the announcement of the pending Volvo sale.

[vztrt]

Geely to acquire Volvo from Ford

http://www.goauto.com.au/mellor/mell...25769B000F9748

Ford confirms plan to sell Volvo to Geely by the second quarter of 2010

29 December 2009

By MARTON PETTENDY

FORD has formally confirmed its intention to sell Volvo to Geely by the second quarter of next year.

Announced on December 23, the move is subject to finance and governmental approvals, with the Zhejiang Geely Holding Group now expected to seek permission from the Chinese government to go ahead with the deal.

The Ford Motor Company announced its intention to sell Ford last December, before naming Geely as its preferred bidder in October.

It paid $US6 billion ($A6.77b) for Volvo in 1999, while unconfirmed reports from Sweden have stated Geely could now pay just $US2 billion ($A2.26b).

Ford said it had agreed “all substantive commercial terms” of Volvo’s sale to Geely, which is expected to be signed within months and officially closed before mid-2010.

“Ford Motor Company confirmed today that all substantive commercial terms relating to the potential sale of Volvo Car Corporation have been settled between Ford and Zhejiang Geely Holding Group Company Limited,” said FoMoCo in a statement two days before Christmas.

“While some work still remains to be completed before signing – including final documentation, financing and government approvals – Ford and Geely anticipate that a definitive sale agreement will be signed in the first quarter of 2010, with closing of the sale likely to occur in the second quarter 2010, subject to appropriate regulatory approvals.

“The prospective sale would ensure Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement its core One Ford strategy.”

Ford said it will continue to co-operate with Volvo “in several areas” after the sale, but does not intend to retain a shareholding in the company.

Geely last month said it had agreed with Ford to own the intellectual property rights on key Volvo safety and the environmental technologies.

Last week, it moved to assure Volvo workers that it will not radically alter the company, following “constructive meetings with Volvo management, labour representatives and government officials in Sweden and Belgium – where its key manufacturing plants are based”.

“Geely is committed to work with all stakeholders to complete the transaction in the best interest of all parties,” said ZGH chairman Li Shufu in a statement on December 23, when the company said it “expects to sign a definitive stock purchase agreement with Ford in the first quarter of 2010”.

“Should a stock purchase agreement be finalised, Volvo will retain its leadership in safety and environmental technologies, and will be uniquely positioned as a world-leading premium brand to exploit opportunities in the fast-growing China market,” said Geely.

Ford and Volvo’s most significant component sharing arrangement is the compact vehicle platform that underpins a number of small cars from Ford, Volvo and Mazda.

Designed by 30 engineers from each company under the direction of Derrick Kuzak, who is now Ford’s global product chief, the front/all-wheel drive chassis architecture first appeared underneath Ford’s then-new C-Max in 2004, in which it is known as C1.

C1 also underpins the current Focus, Kuga and Mazda3, while Volvo’s version, named P1, underpins the C30 hatch, S40 sedan, V50 wagon and C70 coupe/convertible.

Ford’s mid-size EUCD platform is also derived from C1 and while the Blue Oval’s latest global C-car platform will emerge under the redesigned Focus in 2011, future Volvo models are expected to employ the existing P1 and EUCD underpinnings.

Founded and based in Hangzhou in 1986, Geely is one of China’s fastest growing vehicle brands and the nation’s largest privately owned automotive group. The former refrigerator parts supplier entered the automotive industry in 1997.

As we revealed in August, one of Perth’s biggest multi-franchise car dealers and former director of original Hyundai importer Bond Motor Sales, John Hughes, plans to introduce the Geely brand in February, initially only in West Australia.

While Ateco Automotive introduced Australia’s first Chinese vehicle brand (Great Wall Motors) this year, Geely could be the country’s first Chinese passenger car brand available here, following delays in car launches from Chery and Lifan.

The first shipments of a 1.5-litre small car are expected in January and Geely could be joined by other Chinese brands in Mr Hughes’ Chinese Automotive Distributors stable.

While Scandinavia’s largest car-maker was founded in Gothenburg in 1927 and has 22,000 employees worldwide, North America’s number two auto-maker was the one of the US Big Three not to file for Chapter 11 bankruptcy and accept government loans this year.

The deal will give Volvo access to China, which is now the world’s largest single automotive market, and at the same time marks the first major inroad by a Chinese company into Europe.

While Sweden’s Spyker group has also launched an 11th-hour bid for GM’s Saab brand - Sweden’s number two car-maker - Geely’s takeover of Volvo is the latest move in a Chinese expansion drive amid the global automotive industry downturn.

Heavy machinery maker Tengzhong agreed in October to buy Hummer from GM, but the state-owned Beijing Automotive Industry Holding (BAIC) failed in its bids for GM units Saab and Opel. Earlier this month it struck a deal to buy the intellectual property rights for some Saab assets.

However, news of a Chinese owner for Volvo has been received cautiously in Sweden, where it employs 16,000 staff.

“It is still unclear what Geely wants out of this agreement and that makes me worried,” the head of a Volvo trade union in Gothenburg told the TT newswire.

“Even though our sales are rising, Volvo Cars still operates at a loss,” said Unionen chief, Soeren Carlsson. “How Geely wants to solve that, we don't know.”

Volvo's biggest plant is at Ghent in Belgium, followed by Torslanda in Gothenburg and its C70 factory at Uddevalla, 60 per cent of which is owned by Pininfarina.

Volvo also owns assembly plants in Thailand and Malaysia, while Changan Ford Mazda Automobile Coproration in Chongqing, China, produces the Volvo S40 and S80L.

[vztrt]

http://www.caradvice.com.au/51751/ge...vo-operations/

Geely has no plans to change Volvo operations

December 30, 2009 by Matt Brogan

It’s a pretty safe bet that, barring any unforeseen circumstances, China’s Geely Automotive will take over Ford’s Volvo brand sometime in the new year, which begs the question of just how the well-known brand will change.

Now in response to this question, Geely has reassuringly announced that it has no plans to modify the current business operations of Volvo once the deal is struck.

According to the latest press releases by both Ford and Geely, the sale of the Swedish Volvo brand to the Chinese automaker has been set in motion and is expected to close during the second quarter of 2010. Ford specified that all substantive commercial terms have reached agreement, and now only the details are left to be worked out.

Consumers and critics alike have voiced concern over the future of the Volvo brand under new ownership. Volvo is a brand that has established itself as a leader in safety and innovation and it leans heavily on the public’s belief in these attributes to sell its vehicles. Conversely, Chinese automakers are notorious for having extremely low safety and crash standards, in addition to quality shortfalls.

“If the deal succeeds, nothing will change for Volvo, except the boss turns to Li Shufu,” said Mr Li Shufu, Founder and Chairman of Geely Automotive. “Volvo and Geely will be two independently managed brands.”

Mr Shufu went on to explain that Geely’s primary interest in Volvo was in the development of new energy vehicles, while also saying that Geely hoped to reduce some of the production costs for Volvo, in addition to expanding the Volvo brand into the Chinese market.

[vztrt]

http://www.caradvice.com.au/55079/fo...on-february-8/

Ford, Geely deal on Volvo sale expected on February 8

January 29, 2010 by Tim Beissmann

Reports from within China suggest a deal between Ford Motor Co and Zhejiang Geely Holding Group Co over the sale of Volvo could be signed on February 8.

The Hangzhou-based Geely is expected to pay between $1.7 billion to $2.2 billion for the embattled Swedish manufacturer, more than $5 billion less than Ford bought it for in 1999.

Reports suggest Geely will sign a definitive stock purchase no later than the Chinese New Year (February 14) which could lead to the deal being finalised in the second quarter of 2010, given the approval of the Chinese Government.

The finer details, such as how long Ford will supply engines and other components to Volvo, apparently remain under negotiation.

Another source from within China says Geely plans to almost double Volvo’s production with the construction of a new plant in Beijing capable of making 300,000 vehicles a year, helping Volvo return to profitability as early as 2011.

It is believed that Geely is keen to add up to three larger, more luxurious models to the Volvo range by 2014 in its attempt to sell one million Volvos by 2015.

The Volvo S40 and S80 sedans are already manufactured in Chongqing as a part of the joint venture between Chang’an, Ford and Mazda.