While bumbling GM so far hasn’t closed any of their cast-off brands deals, Ford’s Volvo sale to Geely appears to progress quietly, but steadily. The usually well informed and reliable China Car Times says that Geely is “feeling secure about the Volvo purchase.”
Ford has enlisted JP Morgan and Citigroup to assist with the sale, Geely has employed Rothschild. The deal is expected to close soon, “before the start of 2010.”
According to CCT, Geely is working off a seven point checklist:
1. Geely has secured loans and funding from the Bank of China to initiate a buyout of Volvo.
2. Geely plans to keep Volvo as an independent company, rather than merging it into Geely.
3. Volvo may buy parts from China.
4. Volvo keeps its current sales network already set up in China.
5. Volvo keeps its current production setup, and its R&D ability.
6. Volvo keeps its current contract with workers.
7. Volvo keeps its international dealer network.
That, and Geely’s plans to more than double Volvo’s world-wide sales should make everybody happy and keep other bidders at bay.
Ford should stop this sell for some time and gather some of the fruits of the new models.
Geely will make Volvo the success Ford should have. Just more proof Ford management is brain dead. Losing Volvo engineering and brand name to a Chinese competitor is freaking stupid. The low cost Chinese parts bin will revive Volvo. AM failures – among many – the Dreamliner, the dual turbo Taurus, Volvo. I thought no one could harm Ford as much as Nasser, but I have been proven wrong.
Lets see Geely will make volvo a resounding success, just as Volvo itself as well as Ford couldn’t, those chinese manufacturers have such a strong history of this??? The twin turbo is currently 20% of all the new taurus being sold, seems to be doing pretty well to me. The dreamliner, ahead of schedule and under budget when AM left. And what he has to do with Volvo other than getting there after the fact and doing exactly what he said he would do (focus on Ford and sell the other brands).
Oh! So there’s still hope for a resurrected 240 for the Chinese domestic market!
OK, maybe not… but a tough, stout car like that would be perfect for the non-urban areas.
“3. Volvo may buy parts from China.”
“May,” as in “is permitted to” or as in “might” or as in “will”? As in “will buy ALL parts from China”? I don’t see this working so well anywhere where Volvo has any traditional customers expecting a certain overall manufacturing competency. And isn’t it generally the labor costs which make European cars relatively expensive, so what’s changing? Seems naive to pretend Geely doesn’t want Volvo staff and facilities just long enough to show them the ropes (as Ford did), and then start building all-Chinese “Volvos.”