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Report: Volvo Bidder Geely Planning to Double Swedish Automaker’s Sales

Huge sales increases targeted for Chinese market

 |  Nov 12 2009, 1:34 PM

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Ford’s preferred Chinese bidder to purchase the automaker’s Swedish Volvo unit has announced a plan that would see Volvo doubt its sales in the coming years. Zhejiang Geely Holding Group, which owns and operated Chinese automaker Geely, has said it believes it could boost total sales to close to one million vehicles globally, up significantly from the roughly 400,000 units it currently sells. Included in that increase would be drastic growth in China, where Geely plans to build a factory capable of producing as many as 300,000 vehicles. Geely’s plan would see Volvo sell as many as 200,000 units in China, up significantly from the 12,600 units it sold last year.

Also included in Geely’s plan would be the introduction of two or three new vehicles, which would be larger, more luxurious and more expensive than much of Volvo’s current offerings.

In the short term, Geely would look at updating Volvo’s Swedish manufacturing facilities.

The reported price for Volvo is $2 billion, but the deal has yet to be settled with some issues (including intellectual property rights) yet to be resolved.

Geely’s plan for Volvo is in many ways the opposite of a reported plan by Koenigsegg for Sweden’s “other” automaker, Saab. That plan would see Saab sell fewer vehicles than it currently does but at much higher prices.

[Source: Reuters]