Wed, Jan 12, 2011 - Page 10 News List

Geely may start building Volvo plant in China this year, location still undecided

Bloomberg

Zhejiang Geely Holding Group president Yang Jian gestures while speaking at the CommonWealth Magazine Economic Forum in Taipei yesterday.

Photo: Reuters

Zhejiang Geely Holding Group Co (吉利控股集團), the owner of Volvo Cars, may begin building a plant in China this year that will make the Swedish brand’s cars.

“We have yet to decide on the location for the new plant, with Chengdu and other locations under study,” Geely president Yang Jian (楊健) said in an interview yesterday, referring to the capital of southwest Sichuan Province. There is an opportunity for construction to begin this year, he said.

Geely, based in Hangzhou in Zhejiang Province, bought Volvo Cars from Ford Motor Co in August last year for about US$1.5 billion. Expanding in China is key to Volvo’s goal of doubling sales to 800,000 cars in 10 years, Volvo chief executive Stefan Jacoby has said.

China’s vehicle sales jumped 32 percent last year, helping the nation stay the world’s largest auto market for a second year. Chinese carmakers will face “pretty big difficulties” this year after the government scrapped stimulus measures that boosted deliveries last year, Dong Yang (董揚), vice chairman of the China Association of Automobile Manufacturers, said yesterday.

Shares in Geely Automobile Holdings Ltd, the group’s listed unit, fell 1.1 percent to HK$3.68 in Hong Kong. The stock fell 20 percent last year.

Geely is adding more expensive models to lure customers from rivals including General Motors Co and Toyota Motor Corp. The company said on Thursday last week that it aims to increase sales and production by at least 18 percent this year, after increasing sales 26 percent to 415,000 units last year.

The automaker plans to add six new models this year, Geely vice president Liu Jinliang (劉金良) said yesterday in Taipei. The average price of Geely’s models will exceed 50,000 yuan (US$7,548) this year, compared with 47,000 yuan last year, he said.

The automaker is also in talks with Taiwan’s Foxconn Technology Group (富士康科技集團) about developing parts for alternative energy-powered vehicles, Yang said in Taipei, without elaborating.

This story has been viewed 3432 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top