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Geely Buys Volvo; Production May Move to PRC!

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  • Volvo sale to Chinese Geely tests marque’s quality image
  • Production rumored to move to PRC
  • As globalization takes hold, will the Swedish image for quality and safety remain?

By Gunnar Heinrich | IMG Geely Group

SWEDEN’S strongest “brand” (hate that bloody term) is about to have its Swedishness tested.

Since FoMoCo has announced Volvo sale to Chinese fridge maker Geely for a rumored $2 Billion, it’s being suggested from scholarly sects that the bulk of Volvo production will be moved to China.

One such comment came from a Professor Bailey from the Coventry Business School who told the BBC that in his humble-but-ultimately-professional-opinion R&D would stay in Goteborg but the majority of assembly would happen in the PRC.

This despite the fact that Professor Bailey’s native Jaguar still has the bulk of its cars manufactured in the UK despite Indian ownership.

Still, if such hypothesis proved to true and given that Chinese cars currently enjoy a public relations image for safety that’s as solid as coke can folding under a tire, there seems to be much for Geely to gain domestically and much for Volvo to lose internationally.

Particularly in its home EU market.

Frankly, it’s easy to see Volvo customers taking issue with a $40K luxury wagon that preaches safety and quality as its strongest suits when its assembled in a market that historically values neither commodity.

volvo crash test

December 23, 2009
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About the Author: Gunnar Heinrich is publisher of Automobiles De Luxe online and is executive producer of the Automobiles De Luxe Television series on PBS member station CPTV.

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Filed Under: VOLVO

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