For a short time it had seemed that the Volvo sale to Geely had faltered, but now it appears that deal will be wrapped up and inked by the third quarter of 2010 according to Chinese media reports. Initial reports indicated that Ford and Geely had issue at the IPR at stake which came with the Volvo sale, the sale was given the ultimate nod by the EU regulator that is in charge of avoiding monopoly situations in Europe.
During the EU’s investigation into Geely’s assets and backgrounds it was revealed that a government owned investment company based in the oil rich city of Daqing had invested considerably into Geely’s war chest to buy Volvo and has since sparked rumors that Volvo might be setting up shop in the frozen tundra of Daqing rather than the relative comfort of Beijing as previously stated.
A person close to the Geely deal at Daqing’s investment company was quoted in the Economic Daily as saying that Daqing’s investment company had given Geely close to 3 billion RMB and also a large amount of land which Geely might put to use as a Volvo factory with a production capacity of 300,000 vehicles per year.
Daqing is the fourth city rumored to be a production center for Volvo, whilst Beijing, Chengdu, and Shanghai have already been mentioned by the media. Volvo’s China office has already been set up in the financial district of Shanghai in Pudong district.