Geely gets 1 bln yuan credit line from CEB

Shanghai, January 4 (Gasgoo.com) China Everbright Bank signed a deal on December 31 with Geely Automobile Holdings Group to provide the automaker a credit line of 1 billion yuan ($147 million), said xinhuanet.com yesterday. Of this amount, 250 million yuan will be used for Geely Auto's cash flow and the other 750 million yuan as financing support for Geely's dealers.

China Everbright Bank Hangzhoun Branch will use its banking, securities and insurance businesses to provide services of capital, investment and financing to Geely Auto. As one of the first Chinese banks that have been engaged in auto financing services, China Everbright Bank has cooperated with Chery Auto and Beiqi Foton and has built up its expertise in auto financing operation.

An auto industry analyst noted that the 1-billion credit line will help promote Geely Auto's newly initiated strategic transition. It will speed up the cash flow of Geely Auto in production, marketing, sales, and R&D. It can also give financial support to the coordinated development of Geely's Auto industry chain.

Geely president Li Shufu said that the money provided by the bank will be correctly used where it is most needed and can generate the best results. The deal with China Everbright Bank is expected to guarantee the smooth development and growth of Geely Auto amid the global financial crisis spillover in 2009.

Geely Auto plans to sell 281,000 vehicles in 2009, up 25% over 2008, as it introduces new models and taps government incentives to revive the slumping domestic auto market. The private Chinese automaker will launch a new model and a re-vamped model each quarter this year.