• Oct 28, 2009
Volvo S60 concept - click above for high-res image gallery

It's been rumored for months Chinese automaker Geely had the best shot at picking up the Volvo brand from Ford, and today, Dearborn has finally confirmed it. Geely was named as the preferred bidder this morning and the Blue Oval is proceeding with negotiations. However, this is not going to be an easy deal to close. Ford doesn't want to keep any stake in the Swedish company, although it does hope to continue some product cooperation.

In spite of the lack of shareholding, Ford doesn't want Volvo to wither on the vine and wants whoever buys it to have the resources to make it a going concern – unlike what happened when BMW dumped Rover. Perhaps the toughest nut to crack will be intellectual property concerns. Any time a sale like this happens, the seller is be concerned about leaving too much information lying around, and that concern is understandably amplified when dealing with an up-and-coming Chinese company. There is no word on when a deal might be closed, so in the meantime, busy yourself with the official release after the jump.



[Source: Ford]

PRESS RELEASE:

FORD CONFIRMS GEELY AS ITS PREFERRED BIDDER FOR VOLVO CARS

DEARBORN, Mich., Oct. 28, 2009 – Ford Motor Company [NYSE: F] announced today that a consortium led by Zhejiang Geely Holding Group Co. Ltd. is its preferred bidder in the ongoing discussions concerning the possible sale of Volvo Car Corporation.

Ford said that while it will be engaging in more detailed and focused negotiations with Geely, no final decisions have been made.

"Ford's objective in our discussions with Geely is to secure an agreement that is in the best interests of all the parties," said Lewis Booth, Ford Motor Company executive vice president and chief financial officer. "Any prospective sale would have to ensure that Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement our core ONE Ford strategy.

"Ford believes Geely has the potential to be a responsible future owner of Volvo and to take the business forward while preserving its core values and the independence of the Swedish brand. But there is much work that needs to be completed in the more substantive discussions that are agreed to take place. We have no specific timeline to conclude the discussions."

While Ford would continue to cooperate with Volvo in several areas after a possible sale, Ford said it does not intend to retain a shareholding in Volvo.

John Fleming, chairman of Ford of Europe and Volvo Cars, said: "Ford fully understands the iconic Swedish nature of the Volvo brand and the responsibility we have as Volvo's custodian to its employees, local communities and other key stakeholders.

"Any sale also would need to take into account the significant connections between Ford and Volvo in terms of continuing component supply, engineering and manufacturing."

Ford and Volvo will maintain appropriate communications with key stakeholders, such as Volvo's employees, unions and the Swedish government, during the ongoing process.

"Volvo's management team welcomes today's announcement as a positive step forward," Volvo CEO Stephen Odell said. "At Volvo, we are continuing to keep our attention firmly fixed on engineering and building great Volvo cars, to reduce our cost base and to return the business to sustainable profitability at the earliest possible opportunity."


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  • 63 Comments
      • 5 Years Ago
      i also doubt that the kind of people who buy Volvo's would be happy knowing they were manufactured by what are essentially slaves.
      • 5 Years Ago
      Silly Pickle really? You'd buy a Volvo from the people who brought you poison toys and killer drywall and drugs that make you ill?
        • 5 Years Ago
        What the hell does that have to do with Volvo? Sometimes I'm amazed how narrow-minded people can be. Wow.
      • 5 Years Ago
      As with every other Volvo fan out there, I hope not.
      • 5 Years Ago
      Oh and did I forget to mention the pollution manufacture in China causes? With no regulation did you know the major source of air pollution in California is China?!!! So let's see dangerous products made by slaves while contributing enormous amounts of unregulated pollution. Gee sounds like a winner!
        • 5 Years Ago
        Oh one more thing. It's hard to avoid products made in Chine not because there's so many of them but because a lot of times they're stamped "made in the USA", or any other country because even they know how bad their reputation is.
      • 5 Years Ago
      If Ford has even the slightest concerns over intellectual property rights, they need to stay far, FAR away from China.
        • 5 Years Ago
        Well, you do know that Geely BOUGHT those rights don't you? You know, as in purchased, with money, so that they can USE THEM?
      • 5 Years Ago
      Volvo would be a competitor to Ford, so why would they not want it "wither on the vine" once it's sold?
      • 5 Years Ago
      I LOVE VOLVOS!

      I am a complete Volvo-phile. Not anymore.

      It would seem that what makes Scandinavia a great place for cars to originate from the fact that it is the home of more innovations per capita than anywhere else on the planet. Switching a storied brand with such special character from its main pivot point being in Scandinavia to Chinawill certainly change the brand. The culture is different in China than Scandinavia. That is not to say that they cannot build quality or even design beautiful things, but they will never be true Volvos in the sense that all Volvos have been made since back in the day. Philosophies extend throughout all different kinds of systems, like corporate structures. Volvo is going down the drain.

      GOOD THING SAAB IS IN SAFE HANDS! I can still get my Swede on!!
        • 5 Years Ago
        I think you're mistaking Scandinavia for Israel, in terms of innovations per capita, but the Scandinavians make cool stuff too.
        • 5 Years Ago
        @ Resolverobo24

        > GOOD THING SAAB IS IN SAFE HANDS! I can still get my Swede on!!

        Chinese company BAIC bought the company that bought Saab.
        • 5 Years Ago
        Factually incorrect- BAIC is only taking a minority stake in order to get their hands on the outgoing 9-5 model. This is a completely different case than full ownership, as Geely-Volvo would be.
      • 5 Years Ago
      You people assume things. Look at Hasselblad. Classic Swedish company. Owned by Chinese group Shriro. Still located in Sweden, still manufacturing cameras by hand. Those things aint cheap.
        • 5 Years Ago
        hypermiler you're an idiot and frankly a racist moron. The Japanese language doesn't even have all the sounds to pronounce the company's name, and assuming everything that ends in "iro" must be Japanese is friggin' retarded.
        At any rate all this fear mongering about how the Chinese are gonna just move production to China is retarded. Why would you ruin the foreign brand image of the brand you just wasted all that money buying-that makes no sense.
        • 5 Years Ago
        Swede,

        Don't bother to debate with hypermiler, as I said in my previous post:

        he is a Hyundai troll that roams the blogs and forums promoting Hyundai and slandering the Japanese and Chinese under various usernames, very much likely employed by Hyundai.

        in hypermiler's eye's :

        Hyundai and everything out of South Korea is god.
        All else is crap especially if it is from competing Asian countries.
        • 5 Years Ago
        @ Swede

        > Owned by Chinese group Shriro.

        Shriro is Japanese.

        The first thing Geely would do is to move the whole plant to China and fire all Swedish assemblers.
        • 5 Years Ago
        Shriro is very much a Chinese company.
      • 5 Years Ago
      Yeh China!
      • 5 Years Ago
      this is where you see why corporations are not responsible citizens. ford has a responsibility to transfer a legendary company, culture to a owner that values all things brand. brands are not built over night and it takes time. if this Chinese company things they can instantly get credibility by buying an innovator, they are dead wrong. ford squeezed all the safety know how out of volvo to make ford cars some what credible cars but they didn't invest in volvo for it to grow.
      volvo will not be able to ask for premium prices for their cars if they are made in china. china needs a long time to change their perception of low quality made product. until chines companies do their own R&D and come up with their own innovation they will be always considers low quality products that do not have any value to customer.
      it will be a sad day when volvo is owned by a wanna be cool Chinese company.
      lenovo is the only chinese brand that is global and they are struggling in US now also.
      • 5 Years Ago
      Are people really going to buy Volvo's , (know for safety), from the Chinese, (who's every product is life threatening)?
        • 5 Years Ago
        joe : Except if the new owners don't buy the same ingredients for cost reasons, that steak wont taste the same. ;)

        sorry for double post, damn AB for no delete option
        • 5 Years Ago
        Joe based on past performance I'd say yea they would. China routinely sells defective or dangerous products, I don't imagine Volvo under their control would be any different.
        • 5 Years Ago
        Correct. Not I!!

        Volvo's reputation will be toast (perceived and/or tested).
        • 5 Years Ago
        Mikey, out of the literally millions of products coming from China, you've managed to list a handful of dangerous ones. Despite what the media wants us to believe, "every product that comes out of China" is not dangerous. A majority of them is fine, and some excellent. People probably said the same thing when Lenovo bought IBM's PC business. Those people aren't talking now.

        I truly believe that the goal companies like Geely have is to make better and safer cars. That, and to enter the North American market. How better to do both than buying an established brand like Volvo? It's highly doubtful that they're willing to spend $2B to buy a brand just to destroy it.
        • 5 Years Ago
        Right, because Geely really wants to buy Volvo and actively make it unsafe.
        • 5 Years Ago
        Well joe23521 every product that comes out of Chins is dangerous. Remember lead filled toys, wallboard that makes you sick etc. Why would Volvo be any different?
        • 5 Years Ago
        hmmwv is right on.

        Think of it this way, Mikey... The restaurant is changing owners, but the chefs are staying. Your steaks are going to taste exactly the same.
        • 5 Years Ago
        good point mikey683
        • 5 Years Ago
        Mikey, a lot of businesses buys Thinkpads for their reliability, function, and design. They still do after the Lenovo takeover in 2004. The reason is Lenovo kept most of IBM's design and engineering talent, I think if Geely is smart it'll do the same thing.

        Moving lots of assembly work to China, sure, why not, they already building S40s there. But Geely will definitely keep Volvo's current design and engineering team. I think in the end world wide Volvo quality will not drop, the only difference is that it'll start to gain a significant market share in China. I fail to see why is that a bad thing.
      • 5 Years Ago
      That makes me sad...
        • 5 Years Ago
        I have a newer Jaguar and my wife has a newer Volvo. When Tata took over Jaguar, it didn't really bother me at all, heck, they have more money to throw into Jaguar & LR. But with Geely taking over Volvo, that worries me.

        Considering we have spent the last month arguing which of the two cars should be traded in for an SUV, the choice has just been made easier. Love you Volvo, but you gotta go.
        • 5 Years Ago
        ... how. Ford's washing their hands of volvo. their quality perception they've worked so hard to refine focuses on Ford products. Whatever happens to volvo isn't going to affect jon q public looking at the fusion.
        • 5 Years Ago
        This could turn out to be the biggest mistake Ford has ever made and ultimately put them in the same position as GM one year ago and toss away their quality perception that they worked so hard to gain.

        Too bad.

        But all the power to the new owner.
        • 5 Years Ago
        This makes me excited actually, since Geely will probably almost go overnight to making the safest cars out there. Think of the hundreds of thousands of middle-class-but-not-rich-enough-to-buy-an-Accord Chinese peoples' lives that'll be saved.
        I dunno if Volvo really has the kind of intellectual property for the kinds of powertrains generally favored by Asian manufacturers anyway.
        Seemed to work for Ford anyway since their crash test ratings have improved rather considerably after acquiring Volvo.
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