Ford’s sale of its Swedish Volvo brand to Chinese automaker Geely has moved one step closer to completion with news that the two companies have reached an agreement on intellectual property rights issues.
The agreement will see Geely take over control of all technology developed exclusively by Volvo, and still allow Volvo to use any Ford technologies that are vital to developing the brand as a safety leader and in helping it meet increasingly strict environmental regulations.
The step is seen a a huge move forward as it had potential to become a roadblock. Earlier this year the sale of GM’s Opel unit to China’s Beijing Auto was reported to have fallen through due to intellectual property rights issues.
Just last month Ford named Geely as the preferred bidder for Volvo, a deal that is reported to be worth roughly $2 billion, significantly less than the $6.45 billion Ford spent to acquire Volvo in 1999.
Geely has said that its plans for the Volvo brand include doubling the automaker’s production capacity, with huge sales increases projected in Geely’s home market of China. Geely has also said it expects to add several new premium models to the Swedish automaker’s lineup.
[Source: Automotive News]