Geely Close to Closing Volvo Deal
We nearly abandoned all hope (or fear) that China might buy a Western brand. The Ford-Volvo-Geely deal was on the ropes, supposedly over intellectual property worries. We didn’t believe it.
Finally, FoMoCo officially announced that they had inspected all the bids. Geely came out on top, says the Wall Street Journal.
China’s Zhejiang Geely Group Holdings Co. was bestowed the official title “preferred bidder for Ford’s luxury Volvo brand.” Apparently, Geely coughed up the better deal Ford wanted. Now the two sides will enter “more detailed and focused negotiations.”
Ford CFO Lewis Booth said that “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.” Not a word about safeguarding intellectual property.
Ford had also been in discussions with China’s BAIC and the Crown Group, led by former Ford director Michael Dingman. They are out of the race.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
More by Bertel Schmitt
Comments
Join the conversation
WOW Talk about drama! Our Green Yuppie (GY) class has been on life support with the near death of Volvo, Saab, and Saturn. Glad to hear China is throwing them a lifeline. The Prius and Insight have been helpful but have not proven to completely satiate the GY market.
CarPerson , I disagree. Volvos were decent cars from 60's to 2000. There was enough performance and handling for less money then BMW, Audi and Benz. Quality of their cars was even better then Japanese all through 60-70's. Actually it Volvo that started to elevate quality and safety in auto industry.
Looks like I'll be turning in my Volvo next year when the lease is up. My first and last. Sad.
Bertel, how does ChangAn figure into all this? Do you think a final sale to Geely means a merger/takeover/purchase of ChangAn is planned?