Engineering news
US car giant Ford has completed the sale of its last overseas car brand, by selling Volvo to Chinese company the Zhejiang Geely Holding Group for $1.8 billion.
The deal, which was announced in March, sees Geely take on all of Volvo, including its intellectual property, the use of which will be “governed”. The US car giant sold Aston Martin to a Kuwati-led investment group in 2007 and Jaguar Land Rover to Indian firm Tata in 2008.
Alan Mulally, Ford’s president, said: “The sale of Volvo will allow us to sharpen our focus on the Ford brand around the world and continue to deliver the very best cars and trucks to our customers.”
Under the deal, Ford will continue to supply Volvo with powertrains, stampings and other components, and has committed to provide engineering support, access to tooling for common components, and some other services during the transition period.
Volvo UK imports cars into the UK, and employs around 115 people in sales, marketing and administrative functions. Volvo builds its cars in Gothenburg, Sweden and in Ghent, Belgium and produces around 360,000 cars a year.
Geely has said that Volvo will retain its headquarters and manufacturing presence in Sweden and Belgium, and that its management will have autonomy to execute its business plan under the strategic direction of the board.
Li Shufu, chairman of Geely, said: “This is a historic day for Geely, which is extremely proud to have acquired Volvo Cars. This famous Swedish premium brand will remain true to its core values of safety, quality, environmental care as it expands its presence in China and other emerging markets.”
Volvo already produces a small number of its S40 and S80L models in Chongqing, China, and production here will continue. China is a growth market for the company, sales in the region rose 88% for the first half of this year compared to last year.