BAIC Keeps an Eye on Volvo

BAIC, who has been most recently linked with an Opel takeover proposal, is now interested in purchasing the Swedish ailing manufacturer Volvo. The Chinese manufacturer has already announced it is looking to buy or partner with a company overseas and Volvo is one of the last option. An earlier report hinted that Volvo's parent company Ford is now planning to delay the sale of the company until General Motors gets rid of Opel. This way, Ford would be able to invite the losing bidder to fight for Volvo and thus get a better price.

But BAIC has already lost the battle for Opel, as we told you last week, because it couldn't reach an agreement with General Motors over some intellectual property issues.

"We had a good and thoughtful discussion around the key operating metrics and key issues associated with the three final offers we received on Monday evening", said John Smith, GM's chief negotiator for the sale of Opel. "We have agreed to continue detailed talks with both Magna and RHJI to secure Opel's future."

BAIC admitted it lost the race for Opel but revealed that it still wants to continue negotiations for the German brand or at least to look for a partner outside China.

"In the negotiations over intellectual property, we have been in constant communications with General Motors. Regrettably, both parties failed to reach agreement on the intellectual property issue," BAIC said in a statement.

"We still believe that Beijing Auto is a very good partner for GM's development in China and we remain willing to take discussions on IPR arrangements a step further," Xu Heyi, President of Beijing Automotive Industry Corp. (BAIC), said. "GM was worried that after we acquired Opel and obtained its intellectual property rights, we would impact their interests in China and its relationships with its existing partners."