China's Geely agrees Volvo takeover deal: report

[FarCenter]

AFP - Chinese carmaker Zhejiang Geely Holding signed a deal Sunday to buy the troubled Volvo brand from US auto giant Ford, China's state media reported.

The deal was sealed at a ceremony at the Volvo headquarters in Sweden, the official Xinhua news agency said.

Ford announced in December that it had agreed on the main terms of the sale of its loss-making Swedish subsidiary Volvo Cars to Geely, one of China's largest private automakers, for a reported two billion dollars.

The deal will bring to an end Ford's decade-long association with the premium Swedish brand, known for its sturdy, family-friendly cars.

<SNIP>http://www.france24.com/en/20100328-chinas-geely-agrees-volvo-takeover-deal-report

[Double T]

1. Another nail in the US/European economic coffin.

How can a quality brand like Volvo be in trouble; mismanagement and executive greed.

[Dover]

2. My theory is that U.S. companies bought out some of their greatest European & Japanese competitors

and then sat on them until they lost viability in the market. Sometimes companies are purchased to enhance/grow existing larger companies and sometimes they are bought out in order to eliminate the competition.
Either that, or it's a testament to just how poorly American companies are run, causing the
ruin of what were once considered to be the best of the best in automobiles.

For instance, I used to love Saab, Mazda and Volvo, but would not purchase one after the
U.S. companies took the reins. My guess is that if those companies had remained in European/Japanese hands, they would have been fierce competitors for Ford/GM/Chevrolet, etc.

[FarCenter]

3. Sometimes large companies buy a small, well-run company hoping that it will improve the large one

It almost never works that way.

Typically, most middle managers of the large company either ignore or undercut the top managers of the small company.

In this case, Ford bought Volvo in 1999 for $6.45 billion, and it is selling it in 2010 for $1.8 billion.

See also "Geely to buy Volvo from Ford for $1.8 billion"

http://news.yahoo.com/s/ap/20100328/ap_on_bi_ge/eu_ford_geely_volvo

[donco6]

4. That's a huge mistake.

People buy Volvo for the quality and safety. "Made in China" nowadays doesn't lend anything to that notion. They'll destroy the brand and the company.

[boomerbust]

5. This is exactly

What would have happened if GM and Chrysler would have been liquidated. Can you imagine the Corvette being made by a Chinese company? Not me!

[HopeHoops]

6. So how long before WalMart begins selling Volvos?