Ford reaches agreement to sell Volvo Cars to Geely

Zhejiang Geely Holding Group Company Limited and Ford have reached an agreement on the sale of Volvo Cars. The Swedish brand will have its stocks totally acquired by one of the fastest-growing car manufacturers in China, with the sale expected to be closed in the third quarter of 2010.

The purchase of Volvo Cars and related assets will Geely a total of 1.8 billion dollars that will be paid paid in the form of a note in the amount of 200 million dollars, with the remainder being paid in cash.

In a ceremony in Gothenburg witnessed by Li Yizhong, Minister of Industry and Information Technology of the People's Republic of China and Maud Olofsson, Swedish Deputy Prime Minister and Minister for Enterprise and Energy, Li Shufu, Chairman of Zhejiang Geely Holding Group, and Lewis Booth, Chief Financial Officer of Ford Motor Company signed the agreement.

“Volvo is a great brand with an excellent product lineup. This agreement provides a solid foundation for Volvo to continue to build its business under Geely’s ownership,” said Alan Mulally, Ford’s president and CEO. “At the same time, the sale of Volvo will allow us to further sharpen our focus on building the Ford brand around the world and continue to deliver on our One Ford plan serving our customers with the very best cars and trucks in the world.”

“We are pleased to have reached this agreement with Ford, enabling us to safeguard and strengthen Volvo’s renowned brand heritage.  This transaction will ensure Volvo’s continued leadership in the premium segment, where it enjoys a global reputation for safety and environmental-friendly technologies.  This famous Swedish premium brand will remain true to its core values of safety, quality, environmental care and modern Scandinavian design”, said Li Shufu, Chairman of Zhejiang Geely Holding Group.

Geely has shown its intentions of settling China as a second home market for the brand with the construction of production facilities in the country. The Chinese company has also confirmed that it will preserve Volvo Cars’ existing manufacturing facilities in Sweden and Belgium.

Commitment has also been made by Ford in order to provide engineering support, information technology, access to tooling for common components, and other selected services so that the transition period can be as smooth as possible.