Ford announced yesterday it has completed its sale of Volvo to the Zhejiang Geely Holding Group Company Ltd. for $1.8 billion.
The finalized agreement for Volvo and related assets was agreed upon in March and will see Ford “cooperate” with Volvo in the several areas to ensure a “smooth transition.”
“Volvo is an excellent brand with a strong product line, and it has returned to profits after a successful restructuring. We are confident Volvo has a solid future under Geely’s ownership,” said Alan Mulally, Ford’s president and CEO.
Ford, which has not retained any ownership of Volvo business, will supply the new independent automaker with powertrains, stampings and other vehicle components, the company said in a release.
Ford also has committed to provide engineering support, information technology, access to tooling for common components, and other selected services for a transition period.
Agreements between Ford and Geely govern the use of intellectual property; these agreements will allow both Volvo and Ford to deliver their business plans and establish the proper use of each other’s intellectual property.
“The Volvo team has made tremendous progress in restructuring its business and delivering results during the sale process,” said Lewis Booth, Ford executive vice president and chief financial officer.
“We believe this agreement will provide Volvo with the necessary resources, including the capital investment, to strengthen the business and to continue to move it forward in the future. We wish Volvo’s management team, employees and new owners every success for the future.
“Ford appreciates the support of the Volvo management team, Volvo’s labor unions and the government officials in Sweden and China during this transaction,” Booth added.
Geely named Stefan Jacoby, CEO of Volkswagen Group of America, as the new CEO of Volvo Cars.