Geely To Double Volvo Capacity. In China
When Geely bought Volvo from Ford, the feel-good story was that production will remain ind Sweden, with maybe another Chinese factory for Chinese consumption. So much for that. Geely may build three Volvo plants in China, a Geely spokesman told Reuters today.
If the plan is fully executed, Geely would have a combined production annual capacity for 300,000 Volvos in China per year. The final plan needs the approval of Volvo’s board and that of the Chinese government. It would double Volvo’s capacity.
Volvo Cars sold 334,000 cars in 2009, with a pre-tax loss of $653 million.
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.
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You do know that in Belgium there is also a Volvo factory which produces the C30, S40, V50, S60 and XC60? Moreover, the production in Ghent was last year 200.000 cars, while the production in Torslanda was only just over 100.000 cars.
The current plants are operating under capacity. They need to boost sales before it would make sense to add plants. Unlless, of course, the new cars will be as much Volvos as most Chinese Buicks are Buicks.
Building three plants in China is for building 300,000 cars for China. There is plenty of capacity for rest of world from our existing plants. Li Shufu has clearly said those plants are for Chinese market.