Chinese carmaker Chery Automobile has contacted several European auto brands, including Ford Motor’s Volvo, and is interested in an acquisition, a source with direct knowledge of the matter said today.
Reports from China indicate that Chery is trying to raise the capital necessary (about $4.4 billion) to purchase Volvo but industry experts doubt such a takeover is possible. There is no doubt, however that such a purchase would be a major coup for Chery and the Chinese auto industry as a whole as Volvo would represent the first major Western brand to be purchased by the country.
The major stumbing block is basically the maths as the total value of Chery works out at less that the proposed purchase price. Add to this the fact that realistically the brand’s value would undoubtedly be diminished were it to be sold to a Chinese car maker thus making the figures difficult to stand up to scrutiny.
But we’ve said it before, it’s a strange old world at the moment so we shouldn’t discount anything as a possibility.
Ford, however continues to deny that Volvo is for sale despite the continuing rumours.
Source: Automotice News Europe