Chinese automaker Geely has been pursuing Volvo for 10 months now, and it’s beginning to look like the chase was in vain. Bloomberg reports that disagreements over Volvo’s intellectual property are about to scuttle the deal, the same reasons GM gave for rejecting Beijing Automotive’s bid for Opel in July. The problem, it seems, hinges on product integration. Volvo’s vehicles are all based on Ford platforms, so giving Geely access to current and in-development Volvo models means trusting them with the special sauce. And Ford is even less likely to do that, after a former Ford employee was arrested last week for attempting to pass some 4,000 secret documents to SAIC and Beijing Auto.
But there’s more to this than just stereotype-fueled fears of Chinese intellectual property thievery (after all, when has Ford had a problem sharing platforms with Mazda?). Another group of bidders has stepped into the picture, headed by former Ford and Volvo execs. And besides having another potential buyer, Volvo’s US sales finally showed signs of life last month. As Bertel Schmitt recently editorialized, Geely needs to man up and work out a deal while the getting is good. After all, the concept of intellectual property goes hand-in-hand with managing an international brand. Either Geely figures this out soon, or it simply isn’t ready for the big time.
So sharing your intellectual property with the Chinese is like trusting your dog to guard your lunch.
Agreed, the Chinese have shown absolutely no respect for intellectual property rights.
That ‘big dog’ needs some training, or it’ll eat everybody’s lunch. We need to set some rules with them, NOW, while we still have at least some power.
Part of the problem was when Volvo sold to Ford out of dire straits. There was about $400,000 left in the r&d dept for the company, hence the Ford platforms and major influences in the following production models.
To think you can hide anything from the Chinese would be the same as, thinking you can hide a girlfriend from your wife. Get over it and play ball.
All we do by selling our companies to foreign firms is to create new competitors. When will we ever learn?
No, you can’t hide things from the Chinese. However, it’s one thing if they reverse engineer and copy your designs. It’s another if you sell them the blueprints and tooling.
I think most Ford vehicles are based on Volvo’s platform (D3).
Ford’s safety is all Volvo too…
Much as I hate to admit it, you have to be impressed at their ability to copy designs and then claim “it’s original”. That Geely in the phot for example…
Much as I hate to admit it, you have to be impressed at their ability to copy designs and then claim “it’s original”. That Geely in the photo for example…
If Geely could bring the above photographed car with decent crash test results and average reliability to the US for Corolla money, they would sell hundreds of thousands of them.
Agree, npbheights. That’s one classy-looking car. If it’s big enough, they could sell it for Camry money.
Ford employee arrested trying to pass secrets to SAIC? Ok, I just folded a tin foil hat here, but am I the only one thinking that that stuff was ultimately destined for a certain business partner of theirs?
@50merc:
Shanghai Silver Shadow?
The Geely sedan in the photo is not any worse than the Chrysler Imperial Concept.
Yeah, pass the jar, I’ll a cookie. Thanks.
the best thing for ford would be if they can afford to keep volvo in the family. it’s a real nice fit and it wouldn’t take all that much to fix volvo.
There is not much needed to fix a Volvo in North America. Elsewhere Ford has problem called Ford. In Europe Volvo does not sell because Fords fit and finish is as good as Volvo and ALL Volvo engines and transmissions available as Fords for much less coin. In Europe even Lexus does not sell the same engine and transmission in Toyota, it would not fly. The only way to fix Volvo outside of US is to stop selling identically equipped Fords. Not a solution Ford wants to use, I am sure.
Intellectual property, my eye. A whalesized red herring. And it stinks.
Western car companies have shared intellectual property with Chinese for more than 20 years. In joint venture companies. Giant universities that teach the Chinese how to design, assemble, market, and sell a car. These universities have a tuition fee: Share the profits.
Ford already sold Volvo IP to China, for a fee: They have a joint venture with Dongfeng. No IP problems there.
But when a deal goes sour, the public is being bamboozled with the IP bugaboo. Don’t fall for it. Ford shared IP with Stalin and Hitler. They can sell outdated designs and tooling to China just as well.
Jeez, GM has a huge engineering center in Shanghai where they breed future technology at Chinese prices. That’s way more sensitive than selling a “current tech” company. “Current tech” is 5 years back.
Agreed … in this context the IP excuse is laughable. I wonder what really went wrong?
Bartel, A+