Geely to base Volvo China HQ, R&D in Shanghai

Shanghai, July 8 (Gasgoo.com) China's Zhejiang Geely Holding Group, who is buying Volvo Cars from Ford Motor, said today that it will locate Volvo's China headquarters, R&D center and production base in Shanghai's "auto town", media reported, citing a local official.

The Shanghai International Automobile City (SIAC), which is situated in Anting, Jiading district, about 25 kilometers from downtown Shanghai, is already home to Shanghai VW, the car-making venture between SAIC Motor and Volkswagen AG. Shanghai Automotive Industry Corp (SAIC), China's largest automaker, is also based there.

Geely, the new owner of Volvo, has announced that it will set up a research and development (R&D) facility, as well as Volvo's China headquarters and production base in Shanghai, eastern China. "We have reached a deal and the R&D center will be built in our automobile city," said Xu Ming, vice general manager of SIAC, also said last month.

Earlier this week the European Commission approved Geely's takeover of Volvo, and Geely confirmed today that it expects to complete its Volvo deal in the third quarter. Volkswagen's North American CEO Stefan Jacoby is hired to lead Geely's Volvo brand, according to German media.

Geely will spend $2.7 billion on the deal, which includes the original price tag of $1.8 billion plus $900 million in working capital to improve the brand. Geely aims to sell 150,000 Volvo cars in China annually by 2015.