Geely will get right to use Volvo licensed technology
Shanghai, November 17, 2009; Ford Motor's Volvo car division will retain the rights for its licensed technologies, and its Chinese bidder Geely will get the right to use them, Reuters reported today, citing a Geely spokesman.
"Geely's proposal is in line with the best interest of Volvo," Yuan Xiaolin told the Shanghai Securities News. Volvo will retain all its manufacturing and research facilities along with its dealership network and its agreements with the labor union, Yuan said.
Under the proposal, Volvo can above all strengthen its sales network in China, the world's largest auto market, and continue to develop low-emission cars, he said.
Last month, Zhejiang Geely Holding Group, the parent of Geely Auto, was named by Ford as a preferred bidder for its loss-making Swedish car unit Volvo. Yuan said Geely was currently in detailed talks with Ford, not giving a timetable for the deal.
Geely said it would build a new Volvo plant in China with an annual capacity of 300,000 vehicles. Volvo could sell one million cars a year globally within four or five years, compared with recent annual sales of about 400,000 vehicles.
Although Ford and Geely have not disclosed a possible sale price for Volvo, media reports suggested it could be closer to $2 billion than the $6.45 billion Ford paid for the Swedish car maker in 1999.
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