Geely+Volvo=happy drive?

“I drive happily!” This could, in the near future, be the slogan of a car commercial, since the announcement by Ford of an agreement to sell Volvo to Geely (吉利). Volvo means “I drive”, “I move” in Latin and Geely’s Chinese name means “happy”, “auspicious”.

As noted in Ford’s official announcement, “the sale is expected to close in the third quarter of 2010, and is subject to customary closing conditions, including receipt of applicable regulatory approvals.” But the fact, that both Li Yizhong (李毅中), China’s minister of industry and information technology and Maud Olofsson, Sweden’s deputy prime minister and minister for enterprise and energy were present at the signing ceremony in Gothenburg is a sign that the deal is being supported both in Beijing and Stockholm.

Earlier this year, Sichuan Tengzhong Heavy Industrial (四川腾中重工机械有限公司) said it didn’t receive the approval of the ministry of commerce (中华人民共和国商务部) to buy the Hummer brand from General Motors. The acquisition of a brand associated with secure and well designed cars (Volvo) by a company already making cars (Geely) should go more smoothly.

In 2009, Beijing Automotive Industry Holdings (北京汽车工业控股有限责任公司) agreed to buy some intellectual properties belonging to another Swedish brand, Saab, from General Motors. For Geely, Volvo is not the first overseas acquisition. At the beginning of last year, it bought Drivetrain Systems International, an Australian car parts maker.

The deal says, that Geely, which is China’s biggest private car manufacturer “will own 100 percent of Volvo Cars and its related assets”. Geely intends to maintain Volvo’s factories in Europe.