CHINA'S GEELY COMMITS ANOTHER R10 BILLION TO VOLVO

Geely plans to invest a total of 10.5 billion US dollars (R84 billion) in Volvo Cars, the asset it purchased from Ford a year ago for $1.8 billion (R14.4 billion) to become China’s first multi-national car maker.
 

Celebrating the first anniversary of its acquisition, Geely has not only enjoyed growth and progress through rational planning and effective management, but has also helped Volvo Cars to turn loss into gain.

In the months following the acquisition, there was concern that Geely might suffer from organisational challenges.  However, Geely quickly proved that the acquisition was a smart move.  First, Geely allowed Volvo Cars employees to continue to manage Volvo Cars.  With this management style, Volvo Cars employees are fully responsible for managing and operating their own brand and products.

Second, Geely also helped Volvo Cars build its own board of directors and senior management team, which consists of financial, research and development, manufacturing and logistics executives. The established ‘Volvo-Geely Co-operation and Collaboration Committee’ encourages extensive communication between Volvo Cars and Geely in fields including production, purchasing, R & D, marketing and sales, and employee training.   It is this series of effective decisions and actions that has enabled Volvo Cars to thrive financially again despite the European economic slump.

“The acquisition of Volvo Cars allows for collaboration and co-operation between an eastern enterprise and a western enterprise, and it also effectively links the market in the East with that in the West,” said Li Shufu, chairman of Geely.   The two car makers had successfully integrated their organisational, marketing and cultural resources, giving full play to their respective advantages in sales, R & D and services, and had laid a solid foundation for their future growth and development in the ever-changing automobile market, he added.

Geely recently sponsored Zhejiang Symphony Orchestra on a tour to six European countries, including Italy, Austria, the Czech Republic, Germany, Sweden and Belgium.  The tour not only presented music that integrated eastern and western cultures to the European audiences, but also helped to send out the message that Geely and Volvo Cars were both in great shape and had benefited significantly from the acquisition.

STORY BY GEELY