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Volvo to Invest $11 Billion to Increase Stake in Chinese Market

Plan calls for doubling sales to 800,000 units in the next decade.

By Joshua Condon Apr 10, 2012 3:15PM
The Volvo V60. Photo by Volvo.Volvo's aggressive plan to double global deliveries in 10 years, to 800,000 units, won't come cheap. the German magazine Wirtschaftswoche reported yesterday that the Swedish carmaker will invest around $11 billion dollars toward the effort in the next few years. While the initial report suggested that Volvo's majority owner, China's Zhejiang Geely Holding Group, would put up the money, Volvo spokesman Per-Ake Froberg clarified that the financing would come from Volvo itself through cash flow and borrowing, according to Reuters.

The money will be put toward a new engine factory, upgrading technology and strengthening research and development. According to Reuters, Geely Holding Group's other automotive arm, Geely Automobile Holdings, will pool parts purchasing and develop small engines and electric-vehicle powertrains in conjunction with Volvo.

Geely also will roll out a new Chinese-market premium brand using Volvo technologies.

The ultimate goal for Geely is for Volvo to more than quadruple its Chinese deliveries, from 47,000 last year to 200,000, by 2014. Longer-term, the manufacturer wants to claim 20 percent of China's luxury market by 2015. 


[Source: Reuters; Autoblog.]

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DH1995
Apr 10, 2012 4:34PM
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Ahh    The International Automotive Industry Spins more stories for the consumer either Chinese or Swedish  or American.   Just as Ford with the purchase of Volvo,Aston Martin, Jaguar, Land Rover, and subsequent sale of those has shown that its not who makes the parts that is important.  But Who the consumer,  be they be Chinese ,American, Swedish Etc,Etc, THINKS make the Vehicle!  
Even though Ford has "sold"  all their holdings with the various companies they still supply parts and assemblies to  all former shall we say relatives with different strains of various DNA!
Mother Ford depending on the relative importance of the home market doles out the proper   tech for the Branding of that  certain DNA.   General Motors has not been as successful   with the proper  raising of its DNA.    Volkswagen seems to be doing well with DNA transfer though.    Funny Just as Americans thought that Japanese cars were better that american cars, Chinese buyers prefer foreign PERCIEVED built Vehicles.    Got to keep the consumers ill informed or not at all!
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