Comments on: Safe Volvo a risk bet for China’s Geely

By: J

Thu, 05 Nov 2009 13:54:46 +0000

After chinese company get the technology they wanted. All volvo workers in sweden will layoffs.
After chinese company get volvo technology, Chinese company kill US auto industry by cheap price volvo copies.

intellectual property? China is a big country. Sweden goverment and Ford can not do anything against to China.

By: Togo

Togo — Mon, 02 Nov 2009 23:08:15 +0000

I think Geely wants the Volvo brand name more than the technology. Just think of brandname : Geely vs Volvo. think global dealerships. Think reputation: Safety.

The technology can easily be bought but a Geely with Volvo level safety, fit and finish can only sell at Geely margins not Volvo margins. Geely wants to sell at Volvo margins. Also Geely is strong and cost effective in the subcompact range.

Thinks about Volvo designed, small 4 door subcompact with safety, good fuel economy. They can share production volume with a new Volvo badged subcompact of similar design. Geely badged version might have less performance, less quality fit and finish and less safety features like side airbags to keep cost low.

It could leapfrog Geely over other cheap Chinese makes and Geely and volvo could easily push 500K units of this new subcompact.

By: Aficionado

Aficionado — Mon, 02 Nov 2009 16:59:05 +0000

This is also a means for a Chinese competitor to establish itself quickly in the U.S. market by obtaining its sales network and organization via Volvo. So if they build a quality car while utilizing labor cost advantages, they’ll be able to import an instantly recognizable nameplate with the potential for large profit margins.

Here’s the question: is it shortsighted for Ford (or the big three) to expedite the entrance of yet another formidable competitor into an already tight U.S. market?

By: roadrunner

roadrunner — Mon, 02 Nov 2009 16:28:23 +0000

The deal is cheap for Geely which has little interest in the brand and a high interest in the technology. At a fraction of the price of internal development, and available immediately, Geely now acquires world class competitive technology from Volvo which it needs to compete in the Chinese market. Industry bets are Geely will acquire Volvo, strip out the manufacturing technology and then close Volvo all within the next 10 years. Smart strategy, at a rock bottom price.