Geely's bid for Volvo faces labor unions' challenge

Local labor unions are concerned that Geely's bid for Volvo may be harmful to the unions and Volvo employees, reported Friday's Shanghai Security News. Labor unions have proposed a third-party evaluation of the deal and quizzed Geely on financing issues.

In October, a group led by China's Geely Auto was named the preferred bidder for Ford Group's Volvo Cars unit. On December 2, Geely's spokesman Yuan Xiaolin announced that the two sides had reached an agreement over the issue of intellectual property rights (IPRs) involved in the acquisition. Geely will obtain the ownership of Volvo's key technologies and IPRs through acquiring Volvo.

The deal involved not only Geely, Ford and Volvo, but also suppliers, dealers, labor unions as well as the government, said Yuan. "Geely has a principle that the final agreement should serve the interest of all relevant parties, including the labor unions."

Alexander Klose, chief executive of Volvo Car China, said at the 2009 Guangzhou Automobile Exhibition that the final buyer should not mix the Volvo brand with its own trademark.