Ford has long said that selling off Volvo would be difficult given the way the Swedish automaker and its technologies are so integrated into the Blue Oval’s product development and marketing programs. Earlier this month, Ford announced that Chinese automaker Geely was its preferred bidder for Volvo, and now the three entities are meeting together in Sweden to hammer out some final details.
The biggest obstacle to overcome is just who will control Volvo’s intellectual property rights. A Chinese newspaper, Shanghai Securities News, reports that Volvo would own its licensed technology, its facilities and its dealership network but will allow Geely access to its intellectual property.
In return, Geely would build an assembly plant in China that would be capable of producing about 300,000 cars annually.
If it sounds familiar, it probably is: Fellow Swedish automaker Saab , which is set to be acquired by a China-backed Koenigsegg , will give its new Chinese investor access to some of its technologies in exchange for a high-volume assembly plant in the world’s fastest growing new car market.
Reports indicate that Geely will pay somewhere in the neighborhood of $2 billion for Volvo – a far cry from the nearly $6.5 billion Ford paid for the automaker in 1999.
