Chinese business houses seem to have developed a fascination for acquiring global car brands affected by the economic slowdown. After Hummer was acquired by a Chinese company, Volvo seems to be in line next. China based Zhejiang Geely Holding has currently placed the highest bid for gaining control of Volvo. Geely Holding is not interested in acquiring a stake and is vying full ownership.
Zhejiang Geely Holding has placed a bid instead of giving the privilege to its in-house car industry arm Geely Automotive. Ford currently owns Volvo and is keen to ensure that crossover of parts and intellectual property does not take place once a deal is settled. The bid has been placed by Geely Holding in order to assure Ford that such a scenario won’t happen.
According to Li Shufu, Chairman, Geely Holding, talks are at an early stage and are taking time as there are lots of details. Industry insiders are worried that Geely might be interested only in Volvo’s advanced technology. According to a Geely spokesperson Volvo will only benefit from its sales network in China and a technology crossover is not envisaged.
Volvo already manufactures its S40 and S80 car models in China while it imports the C30, C70, XC60 and XC90 in collaboration with Chang’an Motors. Geely Automotive is infamous in its country for manufacturing the cheapest cars.