Ford has completed the sale of Volvo to Chinese car manufacturing group Geely for $1.5bn.
The deal which was agreed in March, marks the US company’s final disposal of an overseas car brand after it sold its UK Aston Martin brand to Kuwaiti-led investors in 2007, and Jaguar and Land Rover to India’s Tata Motors in 2008. It also marks the largest overseas acquisition yet by a Chinese car maker. Li Shufu, Geely’s chairman, said the signing marked “a historic day for Geely, which is extremely proud to have acquired Volvo Cars”.
Ford paid $6.45bn for Volvo back in 1999 when it was split from the truck making group of the same name. Geely said that Stefan Jacoby, formerly chief executive of Volkswagen of America, would become Volvo’s new chief executive on August 19, replacing Stephen Odell, who will now become chief executive of Ford’s European arm.
Volvo will retain its headquarters in Gothenburg and manufacturing presence in Sweden and Belgium, but Geely said its new management “will have the autonomy to execute on its business plan under the strategic direction of the board”.
Geely said in March when the deal was agreed that it planned to nearly double Volvo’s sales to 600,000 in five years, largely by building market share in China, where it is currently has only a small presence.
Ford will continue to supply Volvo with engines and parts for defined periods, but is selling 100 per cent of the carmaker to Geely.
Alan Mulally, Ford chief executive, said in a statement that the sale would allow the company to sharpen its focus on the Ford brand around the world.
“Volvo is an excellent brand with a strong product line, and it has returned to profits after a successful restructuring,” Mr Mulally said. “We are confident Volvo has a solid future under Geely’s ownership.”