Geely Auto weighs global acquisitions to get tech

Geely Automobile Holdings Ltd., which has been considering a possible bid for Ford Motor Co.'s Volvo brand, said Friday that it is interested in using international acquisitions to gain access to technologies and sales networks, and to circumvent trade barriers it might otherwise face as a Chinese auto maker.

Outlining its "path to internationalization," Hangzhou-based Geely didn't name any specific international acquisition targets. But the disclosure provided new insight into the thinking of China's second-largest, home-grown automobile maker after Chery Automobile Co. The company has sent mixed public signals about its interest in overseas deals, even as it has quietly pursued the possible acquisition of Volvo.

"In order to seek capital, to seek markets and to seek partners for international cooperation, overseas mergers and acquisitions is an important method for Geely Auto," the statement said. Overseas deals "will help Chinese car companies with their own brands ease the competition in the domestic market, and at the same time create bigger space for growth," it said.

The Wall Street Journal reported earlier this month that Geely, one of China's biggest auto makers without a foreign partner, is likely to submit a bid to acquire Volvo. People familiar with the situation have said that plan remains on track.

Responding to the report, Geely Chairman Li Shufu initially said last week his company wasn't keen to buy foreign brands. Then, in a press briefing a day later, he softened his stance, saying the Chinese auto maker is open to overseas deals.

Friday's statement said Geely thinks China's lower labor costs are also a good reason for it to get involved in overseas mergers or acquisitions. It didn't elaborate on that point. But an individual familiar with Geely's interest in Volvo has said Geely might be interested in shifting some of Volvo's manufacturing capacity to China to reduce costs.