Volvo Cars and Geely Automobile are planning to merge in a move that would bring the Swedish company back to public markets and create China’s first global carmaker, reported the Wall Street Journal.
The proposal, announced on Monday, comes 18 months after Volvo Cars abandoned an attempt to list independently, against a backdrop of growing consolidation in the car industry. Li Shufu, chairman of both Geely and Volvo Cars, has spent more than a decade assembling a portfolio of brands outside China to complement his domestic car manufacturing business. They include Britain’s Lotus and black taxi maker LEVC as well as Malaysia’s Proton. Geely called off talks to invest in luxury carmaker Aston Martin only weeks ago.
Mr. Li has often expressed his ambition to create a Chinese automotive powerhouse with global reach, modeled after Volkswagen AG’s multi-brand strategy.
Restructuring his auto empire would place Volvo and Geely under one management, and would include Chinese-Swedish automaker, Volvo’s premium electric vehicle company Polestar and British sports car maker Lotus Cars.
Mr. Li also holds nearly 10% of Daimler AG, the German manufacturer of Mercedes-Benz cars.
The new auto company would have production facilities and sales in China, the US, and Europe. Last year, Volvo and Geely together produced around 2.6 million vehicles.
Full Content: Gov UK
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