City of Daqing to invest 3 billion yuan in Volvo
The oil city of Daqing in northeast China will invest 3 billion yuan ($441 million) in Volvo Cars, helping Zhejiang Geely Holding Group Co. finance its $1.8 billion acquisition from Ford Motor Co., Bloomberg News reported, quoting the Swedish newspaper Dagens Nyheter.
The investment will give the Daqing State Asset Operation Co. a 37 percent share of Volvo, the Bloomberg report said. It also may put the city in the running for a Volvo assembly plant to be built by Geely, which has not yet chosen a location.
Other potential sites include Beijing, Chengdu in the southeast and Ningbo in the east, reported Reuters, citing the Shanghai Securities News.
The Securities News also said Geely intends to sell 150,000 Volvo cars in China annually by 2015. Geely plans to launch production of the Volvo XC60 crossover in China this year, followed by the Volvo S60 in 2011, the newspaper added.
Geely will complete the acquisition of Volvo in the third quarter.
The Volvo S40 and S80 models currently are produced at Ford Motor Co.'s joint venture with Changan Automobile Co. and Mazda Motor Corp. Production of S40 will be halted in the future, the newspaper said, without mentioning the S80's future.
