Volvo Cars has taken control of its three joint ventures in China for $2.7bn, to “more accurately reflect its growing presence in the world’s largest car market”.
The Swedish manufacturer now owns 50% of its China joint ventures alongside its parent company Geely. The joint ventures include car manufacturing facilities in Chengdu and Daqing, an engine manufacturing facility in Zhangjiakou, and a research and development center in Shanghai. Volvo said in 2013 that it planned to export cars from its Chinese factories to the USA and Europe, as part of an ambitious five-year plan.
Volvo says that the joint venture purchase allows it to fully consolidate its activities in China, providing a more accurate financial and operational picture of the company as it continues to expand in the region. It announced the move at the same time as its financial figures, which showed a $2bn profit for the first half of 2015.
“The incorporation of the Chinese entities is an important step toward the long-term objectives to capture the growth and sourcing potential in China,” said Håkan Samuelsson, Volvo president and chief executive.
August 26, 2015