Geely interested to buy over Volvo from Ford
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Ford Said to Be in Talks to Sell Volvo Unit to China’s Geely
By Cathy Chan and Keith Naughton
Feb. 5 (Bloomberg) -- Ford Motor Co., seeking to raise cash to avoid a federal bailout, is in preliminary talks to sell its Volvo Cars unit to Geely Automobile Holdings Ltd., according to three people familiar with the discussions.
Ford will likely get less than the $6.4 billion it paid for Volvo in 1999, said one of the people, who declined to be identified because the talks are ongoing. Ford has also approached Chery Automobile Co. and Chongqing Changan Automobile Co., the people said.
Dearborn, Michigan-based Ford lost a record $14.6 billion last year and is trying to avoid asking for government loans to survive as U.S. auto sales plunge to the lowest level in almost 27 years. A purchase of Ford’s last European luxury brand would help Geely’s founder Li Shufu meet his ambition of overseas expansion, even as the Swedish unit’s sales plummet.
“Li has an entrepreneurial spirit and no fear,” said Asian automotive analyst Tim Dunne of J.D. Power and Associates in Westlake Village, California. “He just goes and gets stuff done.”
Ford spokesman Mark Truby and Geely spokesman Zhang Xiaodong declined to comment.
Geely’s Approach
Geely first approached Ford about buying Volvo a year ago, before the Dearborn, Michigan-based automaker had decided to sell its Swedish auto unit, one of the people said. Preliminary talks with Geely began in December after Ford said it would consider selling the unit, the people said.
Geely has received permission from China’s National Development and Reform Commission to study the acquisition, said the people. The government agency must sign off on any major merger and acquisition talks before a company can enter into them.
Volvo has struggled as the global auto market declined and other automakers made gains in safety technology, a long-time strength for the Swedish automaker. Volvo’s U.S. sales fell 64 percent last year. Ford said Volvo had a pretax loss of $736 million in the fourth quarter.
Jaguar, Land Rover
Last June, Ford sold Jaguar and Land Rover to India’s Tata Motors Ltd. for $2.4 billion. It sold its Aston Martin luxury line for $931 million in May of 2007 to a group of investors.
Geely was founded two decades ago by Li, a former farmer who amassed a net worth of $220 million according to Forbes magazine. Last year Geely’s sales in China fell 1 percent while the total market increased 7 percent, according to J.D. Power and Associates. At the economic forum in Davos last month, Li said Geely’s sales will rise 25 percent this year.
Ford provides engines to some Volvo cars and the two automakers share mechanical underpinnings on several models. Any buyer would have to be assured that Ford will remain healthy enough to provide those key components to Volvo, the people said.
Geely would likely seek to buy Ford’s entire equity stake in Volvo rather than negotiate with the Swedish unit over purchases of specific assets, the people said.
Ford creditors are likely to receive some, or even all, of the proceeds from any sale of Volvo. Ford pledged Volvo as part of the collateral it put up for $23 billion in loans it secured in 2006.
To contact the reporter on this story: Cathy Chan in Hong Kong at [email protected]; Keith Naughton in Southfield, Michigan at [email protected]http://www.bloomberg.com/apps/news?pid=20601087&sid=aEGTs7IHYCYU&refer=home
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like that i will never buy a volvo anymore
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new logo:
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Originally posted by fireice rox:
new logo:
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geely would ruin volvo if they really acquired volvo
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I don't see how Geely will ruin Volvo. They will provide much needed cash, and use vehicle platforms developed by the latter (such as the S60's) rather than the other way around. The Volvos will still be built in Sweden, and they're already using parts built in developing countries by their suppliers.
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I will tell you how. These Chinese don't innovate. They just use the ideas from others. Look at Rover. Volvo will become stagnant and subsequently outdated under the Chinese. I rather see Volvo under Renault.
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Rover has had a dated line-up for some time now, and they went nowhere under BMW and Phoenix as well because the marque and the physical assets and facilities were split.
Tata owns the marque now (yes, together with Jaguar and LR) having bought them it Ford which in turn purchased it from BMW. SAIC and Nanjing own only the factories, tools and rights to existing models.
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Like that will Volvo car prices plummet?
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Originally posted by fireice rox:
new logo:
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Originally posted by xunmeng:
geely would ruin volvo if they really acquired volvo
Imo, Volvo's prestige in the international motoring arena will be affected... but hope that would not be true... If Geely really sealed Volvo's fate...
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Originally posted by lianamaster:
Like that will Volvo car prices plummet?
It's hard to tell... Geely may want to 'exploit' Volvo's technology and design sense for their own cars... or may retain Volvo as a premium brand and develop better cars... in these current times... its unpredictable...
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Originally posted by Volvo_Volgren:
It's hard to tell... Geely may want to 'exploit' Volvo's technology and design sense for their own cars... or may retain Volvo as a premium brand and develop better cars... in these current times... its unpredictable...
hmm... volvo sound better than geely... hehe...
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5 STAR NCAP Geely CK for the upcoming model LOL
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Originally posted by lianamaster:
hmm... volvo sound better than geely... hehe...
Or maybe a merger titled 'VolvoGeely'... Lol
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Originally posted by NoobBOY:
5 STAR NCAP Geely CK for the upcoming model LOL
LOL... maybe that CK is based on either a S40 or... S80! Wah...
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Originally posted by Volvo_Volgren:
LOL... maybe that CK is based on either a S40 or... S80! Wah...
Haha or even based on the new S60 concept car which will make it YUCKS!
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Originally posted by NoobBOY:
Haha or even based on the new S60 concept car which will make it YUCKS!
Hahah... hopefully not!
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Some parts of Volvo cars like Engines used in C90 are made by Japan Yamaha. It a pity for a nice company to be taking over by cheap china compay. Gone are the volvo cars safety record of the company. How about Singapore ST take over? since ST made army tanks and sell to England, as Volvo cars alway very safe and tough, just kidding. :-p Is Geely car company made oem parts for Toyota cars in China?
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shocking news upon switching on laptop!
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Aren't Volvo one of the safest car manufacturers around? I can't imagine it being taken over by a China company.
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who called for me ah..
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scarley they start exporting bodies from china.
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for medical research..
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put volvo engine into geely body....
and stop flaunting the 5-star rating...
you get the same volvo lor!