Volvo First Foreign Automaker to Take Control Of China Business
Swedish automaker Volvo Cars will be the first major foreign traditional automaker to take full control of its Chinese operations.
Analysts view this as the first of many non-Chinese automakers that will take full control of operations in China once the rule to partner with a local partner is removed in 2022.
Volvo agreed to buyout its parent and joint venture (JV) partner Geely Holding Group’s stake in two JVs for an undisclosed sum.
The transaction will be completed in two phases, starting in 2022 and ending in 2023. And could help pave the way to make for a more attractive IPO.
Geely Holding, which owns HKEX-listed Geely Automobile, had previously said it was mulling options, including a listing for Volvo.
In 2020, Volvo sold 166,617 cars in China, 7.5% more than 2019. In 1H2021, sales increased 44.9% YoY.
Image credit: Bread News / Volvo