Volvo, Zhejiang Geely to enter into vehicle manufacturing venture in China

Article by Christian Andrei, on February 21, 2012

Volvo Cars and majority shareholder Zhejiang Geely Holding Group Co. will enter into a vehicle manufacturing venture in line with the plans to expand in China, which is the largest automobile market in the world. Volvo will disclose the "concrete details" of the joint venture in around two months, the automaker's Beijing-based spokesman Michael Ning stated.

In accordance with the requirements for a Chinese joint venture on automobile manufacturing, Volvo will also launch a new brand exclusive to China as well as more fuel-efficient vehicles, Ning added. Under the present regulations, Volvo is considered a foreign automaker even if it is wholly owned by Chinese interests, Ning explained. He added that Volvo also requires a local partner before it can manufacture vehicles in the country.

Ning disclosed that Volvo is waiting for the National Development and Reform Commission's approval of a proposed facility in the southwestern city of Chengdu. The automaker is aiming to double sales to 800,000 vehicles worldwide in a decade through 2020. The automaker also intends to spend at most $11 billion around the world in the next five years in order to meet increasing demand in markets such as China, Volvo CEO Stefan Jacoby stated in February 2011.

In August 2010, a Chinese consortium including carmaker Zhejiang Geely purchased Volvo for $1.8 billion from Ford Motor Co. The sale completed the largest overseas acquisition by a China-based automaker. Zhejiang Geely has 51 percent share of Volvo. Meanwhile, the Chinese province of Daqing has 37 percent while the Jiading province has 12 percent.

Volvo's Chinese operations chief, Freeman Shen, disclosed in an interview in June that the automaker is studying an additional manufacturing facility and engine plant in China to its proposed Chengdu factory. Foreign vehicle manufacturers are expanding in China, where lower vehicle-ownership levels and rising wealth aided the country to outperform the U.S. as the largest vehicle market in 2009.

Topics: volvo, china, geely

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

BMW’s 550i xDrive has long been considered as one of the most successful business sedans in the world. For the brand, this may not be enough as it has officially...
by - January 20, 2017
Amazon is now moving beyond the four corners of online retailing. Only recently, the retail giant has been awarded a patent for its Road Network system. Since the patented technology...
by - January 20, 2017
The newest version of the Lamborghini Huracan is not a Superleggera, but a Performante. When Lamborghini filed for a patent for a new name, there were still debates whether this...
by - January 20, 2017
What is hotter and more menacing than a Hellcat? If we ask Dodge, its answer would be the “Demon.” Of course, we aren’t talking about a demon with horns and...
by - January 20, 2017
The 2018 model year could be an exciting year for fans and enthusiasts of the Chevrolet Corvette. This comes as the 2018 version of the Corvette is bound to feature...
by - January 19, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries