Volvo Car Corp will retain the rights for its licensed technologies, while its Chinese bidder Geely will get the right to use the technologies, according to a spokesman for the Chinese carmaker speaking to Shanghai Securities News.
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Shejiang Geely Holding Group, the parent of Geely Automobile, was named by Ford as a preferred bidder for its loss-making Swedish car unit last month. Spokesman Yuan Xiaolin said: “Geely’s proposal is in line with the best interest of Volvo.”
Yuan added that Volvo will retain all its manufacturing and research facilities along with its dealership network and its agreements with labour unions while Geely will help the Swedish carmaker strengthen its sales network in China and continue to develop low emission cars.
There is still no timetable for the deal and Yuan said Geely is currently in detailed talks with Ford. Geely Chairman Li Shufu told Reuters last month he was confident of the Volvo bid.
Earlier this month the Wall Street Journal reported that Geely would build a new Volvo plant in China capable of making 300,000 vehicles a year.
Volvo could sell one million cars a year globally within four or five years, compared with recent annual sales of about 400,000 vehicles, the newspaper said.
Ford and Geely have not disclosed a possible sale price for Volvo, but media reports suggest it could be closer to USD2 bn, considerably less than the USD6.45bn Ford paid for the Swedish car maker in 1999.
