Tags: AS | China | Geely | Volvo

China's Geely to Sink $900 Million More Into Volvo

Tuesday, 30 Mar 2010 07:56 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink

Chinese automaker Zhejiang Geely Holding Group expects to spend hundreds of millions of dollars beyond the $1.8 billion purchase price for Volvo Cars to make the Swedish car company profitable, Geely's chairman said Tuesday.

Geely is projecting a total tab of $2.7 billion for its takeover of Volvo, with money beyond the purchase price to be spent on expanding production, chairman Li Shufu told reporters.

Li said half of the total cost would be financed from overseas and half from within China, divided between Chinese banks and Geely itself.

In studying Volvo, Geely found the company had high research and development costs but made cars on a much smaller scale than high-end rivals Daimler AG and BMW AG, said Li. "We will find a way to let Volvo's technology play a better role and to expand their scale in order to lower the costs," Li said.

Geely's acquisition of Volvo from Ford Motor Co. has been heralded as breakthrough deal for China's auto industry, giving one of its most ambitious automakers a well-known, prestigious global brand and access to top-tier technology.

Li said Geely would not seek to impose its own corporate culture on Volvo but rather find ways to let the Swedish company exploit its strengths.

"Geely is Geely, Volvo is Volvo. Geely will not produce Volvo, and Volvo will not produce Geely," Li said. He compared Geely's and Volvo's relationship to two brothers, not to a father and son.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web

Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 

You May Also Like
Around the Web

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved