A couple of years ago, Geely bought Volvo for $1.5 billion from Ford. Geely gained ownership of Volvo’s platforms and a licensing contract from Ford as part of the acquisition. The licensing contract has limitations and the platforms are getting older. Geely is now going to invest as much as $11 billion until 2015 into a development program for the next generation Volvos according to Reuters.
Zhejian Geely Holding Group Posts
Ford Motor Company (NYSE:F) is confident that they will be finalizing an agreement to sell Swedish car subsidiary Volvo to China’s Zhejian Geely Holding Group. Chinese Vice President Xi Jinping is scheduled to be around to sign the deal according to the Detroit News. “We’re still working toward reaching a definitive sales agreement by the end of this month,” stated Ford spokesman Mark Truby. “Things are looking good for Volvo right now, and we want to get on with selling our cars,” added Volve spokesperson Olle Axelson. Ford CFO Lewis Booth is expected to fly over to Sweden this weekend. Volvo lost $653 million last year which is $812 million less than it lost in 2008. Ford started looking for buyers on Volvo after selling Jaguar and Land Rover to Tata Motors. Geely reportedly will be buying Volvo for about $1.8 billion. [Detroit News]