Volvo to Retain Rights Over Licensed Technologies

In case the deal with Chinese carmaker Geely goes through, Volvo will continue to hold the rights over its licensed technologies while its new owner will only be able to use them. A Geely spokesman also emphasized that Volvo will keep manufacturing and research centers as well as the dealership network but the Chinese carmaker will most likely help expand local operations through the opening of a new plant and new stores.

Ford confirmed last month that Geely is favorite to purchase Volvo but only a few details on the state of negotiations are currently available. It was rumored that the Chinese manufacturer is willing to offer up to $2 billion and intends to set up a new factory in its domestic market to handle local production of Volvo models.

The European infrastructure would be used at full capacity if Geely manages to buy Volvo, helping the Chinese manufacturer deliver a total of 600,000 cars in both Europe and North America.

“Ford’s objective in our discussions with Geely is to secure an agreement that is in the best interests of all the parties,” said Lewis Booth, Ford Motor Company executive vice president and chief financial officer. “Any prospective sale would have to ensure that Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement our core ONE Ford strategy."

Geely's officials are confident that the deal will go through and call for patience as the two sides are still negotiating on the sale terms.

"There are lots of details and we're taking our time," Geely chairman Li Shufu said earlier this month. "We will continue to work hard and bring Geely to every corner of the world," Li said. "We are seeking our way out into the world," he added.