While General Motors is still trying to figure out what it's going to do with its Saab division, Ford Motor Company announced today that it has settled all substantive commercial terms with China's Geely Holding Group Company Limited on the prospected sale of its Volvo unit.
Ford added that while some work still needs to be done before the deal is sealed such as final documentation, financing and government approvals, the company anticipates that a definitive sale agreement will be signed in the first quarter of 2010, with closing of the sale likely to occur in the second quarter of the same year.
"The prospective sale would ensure 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 its core ONE Ford strategy," Ford said in a statement,
The Detroit automaker added that it would continue to cooperate with Volvo Cars in several areas after the sale, but it does not plan to retain any shares in the business.
It is said that Geely is offering the U.S. automaker somewhere around $2 billion dollars for Volvo Cars which is less than a third of what Ford paid for the Swedish brand a decade ago.
With the prospected sale of Volvo, Ford will offload the last brand in the Premier Automotive Group that also included Jaguar, Land Rover and Aston Martin.
9 Comments:
So Chinese cars now have a high water mark for crash safety to meet! Hard to get much better than Volvo.
This is great to hear! At least one Swedish brand is going to survive. As for Saab, I love Saab, GM just sell the dang brand to Spyker. Overall I see good things for the future of Volvo.
If it is true, I'll never buy a Volvo again.
Don't need Chinese car.
What have american carmakers done with the carmakers they bought all around the world ? And they didn't even managed to remain the first nor save jobs in their own country. What a human, technological, brand and financial wreckage...
this is Ford's first serious mis-step since new mgm't took over.
Super image and premium prices for a spin-off from other Ford/Mazda designs
Just reading up on a few things about Geely, seems promising. They already have experience in some areas of auto manufacturing in its own right and co-ownership of the beloved London Taxis. They appear to be "innovators" not much like their colleagues in China who tend to copy body styles and call it, its own.
This appears to be a Hong Kong-based company as opposed to Mainland China, which is a good thing. Given it's near 100 year influence from the British, the propects look promising. But, I'll admit that dealing with the British is far different than dealing with Swedish.
While in general, I am with the anonymous poster who said he'd never buy a Volvo again, because it is now owned by a Chinese company. I thought the same when Ford bought Volvo until I thoroughly investigated what kinds of things Ford shares with Volvo and visa-versa in particular with the XC90 (that I own today). In that relationship, more was taken from Volvo (particularly the AWD system on the XC90 that is now used in the Explorer amongst all the other SUVs) than Volvo taking from Ford. If the Geely relationship is the same, Geely will benefit more and I hope to see that the "top" models for Volvo will remain unique and less on the early designs of Geely, which were based on an '87 Daihatsu Charade. Hopefully, the S40 does not have that fate. :/
For now, I'm neutral. Let's keep several things in mind, even though Ford sells the company as a whole to Geely, by default as was the case of all the other brands which were sold, Ford still has to provide parts assistance, platform sharing, etc. for at least another 4 years. So, it might be OK.
In any event, as Ford said in this article, there are still a lot of things to be worked out and who knows, it could be the same problem that GM had with Saab selling to Koeniggsegg. But, whatever the case is, this is definitely something to watch closely.
By by Volvo, it was a nice time.....
I'm afraid that they's target is copy every piece of Volvo's safety systems :s
this is Volvo signature year i love the way they are making a come back because every car since now was a disaster
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