Chinese automotive giant Geely completes takeover of Volvo

Geely also proceeded to appoint Stefan Jacoby to take over the chief executive officer’s duties from Stephen Odell. Jacoby was the former US chief executive for Volkswagen AG America. The 52 year old former VW top man held the position for 3 years before stepping down where he was involved with cost cutting measures, rolling out the first ever model for the American market, moving the Volvo headquarters from Virginia to Michigan as well as building a Tennessee based assembly plant.

This was part of the strategy imposed by Alan Mulally, the Chief Executive Officer of Ford where they are no longer interested in the European car brands in order to be fully focused on their Ford brand instead.

Li Shufu, the chairman of Geely will be the chief of the Volvo brand board which also include the former CEO of Volvo, Hans-Olov Olsson. Geely also announced that Stuart Rowley, the interim chief financial officer will also relinquish his duties to make way for Hans Oskarsson. The deal was first reported back in the mid 2008s and the deal was finalized only recently with a purchase price of USD1.8billion agreed in March this year. Having done that, the final amount will only exactly be determined later this year after the value of the Gothenburg base is determined.

Under the new deal, Ford will still be involved where they will be supplying components like powertrains, stampings and others to Volvo while providing support in terms of engineering and technology as well as access to tooling for its common components. It was also revealed that the S40 and S80L models for the China market were built in the factory co-managed by Ford and Chongqing Changan Automobile Co and Volvo will still be doing so for the next 3 years until they build their own factory in the next few years. As part of its European exit strategy, Ford recently sold Aston Martin to a group of investors led by David Richards 3 years ago and then in 2008, they also sold Jaguar and Land Rover to India’s Tata Motors for an agreed sum of USD2.4billion.