Volvo Cars has signed an agreement with its parent Geely Holding to acquire Geely Holding’s stake in the companies’ joint ventures in China, with the aim of taking full ownership of its car manufacturing plants and sales operations in the country.
The acquisition of an additional 50 percent of the shares in Daqing Volvo Car Manufacturing Co., Ltd and Shanghai Volvo Car Research and Development Co., Ltd, will further strengthen Volvo Cars’ position in China, its largest market, and maximize exposure to one of the fastest growing regions globally.
“With this agreement, Volvo Cars will become the first major non-Chinese automaker with full control over its Chinese operations,” said Håkan Samuelsson, chief executive of Volvo Cars.
“Geely Holding Group and Volvo Cars are continuously evaluating the best way to collaborate and structure operations within the wider Group. These two transactions will create a clearer ownership structure within both Volvo Cars and Geely Holding,” said Geely Holding chief executive officer, Daniel Donghui Li.
Volvo Cars has grown significantly faster than the average market in China in recent years and will continue to invest in the country to maintain the strong growth trend. Following the transactions, Volvo Cars will have full ownership of its manufacturing plants in Chengdu and Daqing, its national sales company in China and its R&D facility in Shanghai.
The transactions will be completed in two steps, starting in 2022 when the joint venture requirement for auto manufacturing in China will be lifted, and expected to be formally completed in 2023.
Volvo Cars has seen strong growth in the Chinese market in recent years. In 2020, it sold 166,617 cars in China, an increase of 7.5 per cent versus 2019 and its eighth consecutive sales record in the market. In the first half of 2021, sales increased 44.9 per cent compared to the same period in 2020, and by 40.1 per cent compared with the same period in 2019.
Good. Volvo doesn't need Geely, or any chinese JV partner for that matter. Its just dilutes Volvo's brand.
ReplyDeleteUpon reading the article, Volvo is not buying themselves out from the Geely group/ownership. They are just buying out the China Manufacturing operations (Daqing Volvo and Shanghai Volvo) to increase their control to be sole operator/owner of those factories for the Chinese Market.
DeleteThey are still under the Geely umbrella.
Correct! And the parent Volvo company is still owned by Geely, so however they restructure the ownership on JVs, overall control of Volvo would still be under Geely.
Deletewhat is there to be diluted? Volvo already sucked even before they were acquired by Geely
DeleteComing from a non volvo user...
Delete^^
DeleteWe had a Volvo s60 2008 before... Nothing but problems. I'd never touch any Volvo or anything European for that matter.
Geely acquired Volvo in a time when Volvo was nearing financial ruin under Ford ownership. Under Geely they've bounced back stronger. You should really look up what you're talking about first.
DeleteWhat's really ironic to the point of weeping hilarity is that those people praising Volvo are the same ones saying Fords are junk.
DeleteThats good news but paano naman yung mga loyal Geely owners?! Ang yayabang pa naman that "Volvo is like Geely, or vice-versa. Kawawa sila di ba?
ReplyDeleteBWAHAHAHAHAHA
DeleteInggit pikit
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