Ford plans to complete its sale of Volvo Cars to China’s Zhejiang Geely Holding next week, finishing the U.S. automaker’s exit from European luxury brands, according to two people familiar with the plans.

Ford is selling Volvo to Geely for $1.8 billion, less than one-third of what it paid for the Swedish automaker in 1999. Ford and Geely executives are aiming to close the sale next week, pending final regulatory approvals and financing, said the people, who asked not to be identified revealing internal plans.

Unloading Volvo would complete CEO Alan Mulally’s strategy of exiting European luxury lines to focus on Ford’s namesake brand. Since arriving from Boeing in 2006, Mulally has sold Aston Martin, Land Rover and Jaguar, which Ford acquired in 1989 as the first of a stable of premium nameplates that failed to generate the profits the automaker expected.

“Any time you’re marrying a commoner to a blueblood, that marriage is going to be hard to maintain and sustain,” said Rebecca Lindland, an analyst for IHS Automotive in Lexington, Mass. “It’s a shame because the Volvo-Ford marriage was one of the strongest because their car buyers had similar characteristics.”

Ford fell 12 cents to $12.91 on the New York Stock Exchange. The shares have gained 29% this year.

Volvo makes profit

Volvo had pretax profit of $53 million in the second quarter, compared with a $237-million loss a year earlier, Ford said last week.

Ford, the only major U.S. automaker to avoid bankruptcy last year, posted net income of $2.6 billion in the second quarter, exceeding analysts’ estimates by 66%.

“We expect to complete the Volvo sale in the third quarter,” John Gardiner, a Ford spokesman, said in an e-mail. He declined to comment on whether the sale will close next week.

Tim Burt, a London-based spokesman for Geely, declined to comment on the timing of the completion.

Ford has said it will continue to supply Volvo with engines, transmissions and other vehicle components. It also agreed to provide engineering and technology support and access to tooling for common components for an unspecified period.

The Swedish carmaker’s S40 model is built on the mechanical foundation of the Ford Focus now sold in Europe. Volvo supplies diesel engines for Ford’s European lineup.

“They’ll probably wind that down over time,” Lindland said of the technology and parts-sharing agreement with Volvo. “Mulally runs a pretty tight ship. And that’s obviously working out really well since they’re making billions in a really crappy market.”

Car manufacturers are very well known for investing into R&D. So extensive research is nothing but the norm for them. For Volvo, research has turned more into demonstration of what people are capable of, given the externalities of their habitat…almost like the Discovery Channel, but only, there’s alcohol involved.

Volvo’s reputation has always been strongly glued to safety and collision comprehension, however, with us human being a complex bunch of ‘mooks’, they’ve decided to run a few experiments conducted by the Swedish manufacturer, just to see which European country will be crowned the most naughtiest!

And so it is, bottoms up, enjoy the night and the clip below to see the going-ons of a night to be remembered for most, except for those in Paris ofcourse. Naughty, naughty.

The EU found that the move wouldn’t stifle competition within its borders and gave all of the interested parties the green light. Ford originally agreed to sell Geely its former ward in March of this year, and the US$1.8 billion dollar purchase is well on its way to becoming reality.

The move is a big one, not just for Volvo and Geely, but the whole of the Chinese auto market. According toReuters, the buy is the largest overseas automotive acquisition any Chinese company has made to date. We would be surprised if it were the last, though.

Volvo has just gone into battle-mode to try and convince the world that wagons are handy and a cool addition as a prized possession, with its latest video featuring its very own sexy V60 long-roof. The car appears to have a soft spot in hustling family and cargo across town in a jiffy.

The company is offering a variety of engines for the V60, including the new 2.0L direct-injected four, which can kick up 203bhp and 300Nm of torque! But, unfortunately, we aren’t sure if it will ever land in Malaysia. However, Volvo has been very generous in supplying the V60 with a turbo 3.0L T6 with 304bhp and 440Nm! This all-wheel drive vehicle can even scoot up to 100kph in just 6.6s. The V60 is only available with a six-speed automatic transmission.

It is reported that there will be more than 8 engines offered by Volvo for the V60 and we have no idea which one will hit the Malaysian roads. Either way, we are glad enough to share this wonderful video with all of you. Enjoy!

Recently, the detuned C30 was put through its paces around Volvo’s proving grounds where it was found that the hatch feels like a well-sorted version of Mitsubishi’s Lancer Evolution, with a close resemblance to being a “Junior Nissan GT-R”.

However, it is highly unlikely that we would be able to see a production version of this vicious C30 anytime soon. But this exercise has proven one thing, and that is the partnership between Volvo and Polestar should be acknowledged. Look out BMW’s M and Audi’s S/RS divisions.

Chairman of Zhejiang Geely Holding Group, Li Shufu, left, and executive vice president and chief financial officer of Ford, Lewis Booth, shake hands in front of a Volvo S60 car in the Volvo Hall at the Volvo plant and headquarters in Torslanda, Gothenburg, Sweden, yesterday. (Reuters)

The China Post – Chinese car maker Zhejiang Geely Holding has officially  signed a deal on Sunday to buy the troubled Volvo brand from U.S. auto giant Ford, China’s state media reported.

The deal was sealed at a ceremony at the Volvo headquarters in Sweden, the official Xinhua news agency said.

Ford announced in December that it had agreed on the main terms of the sale of its loss-making Swedish subsidiary Volvo Cars to Geely, one of China’s largest private automakers, for a reported US$2 billion.

The deal will bring to an end Ford’s decade-long association with the premium Swedish brand, known for its sturdy, family-friendly cars.

Volvo unions had earlier voiced opposition to the deal on grounds that it was vague on expansion plans and possible layoffs.

Three Volvo unions this week pressed for details “on the capital that will finance Volvo’s daily activities, investment on future projects and the production target of 600,000 vehicles by 2015.”

Volvo unions had earlier voiced opposition to the deal on grounds that it was vague on expansion plans and possible layoffs.

Three Volvo unions this week pressed for details “on the capital that will finance Volvo’s daily activities, investment on future projects and the production target of 600,000 vehicles by 2015.”

But on Saturday they pronounced themselves satisfied.

“We have received all the information that we were looking for,” Glenn Magnusson, head of the Ledarnas union, told Sweden’s TT news agency after two meetings with U.S.-based Ford and Geely management in Gothenburg on Saturday.

“As far as the unions are concerned, we are in favor of the agreement.”

Magnusson did not provide details on the talks with management, saying he and his colleagues from other unions had signed a confidentiality agreement.

Asked whether the Chinese company had given a guarantee that jobs would remain in Sweden, Magnusson said, “we have obtained a response to our questions.”

Volvo has 22,000 employees worldwide, including 16,000 in Sweden.

Ford Motor Company announced in December that it had agreed on the main terms of the sale of its loss-making Swedish subsidiary Volvo Cars to Geely, one of China’s largest private automakers, for a reported two billion dollars.

The deal will bring to an end Ford’s decade-long association with the premium Swedish brand, known for its sturdy, family-friendly cars.

Ford had said it anticipated “a definitive sale agreement will be signed in the first quarter of 2010, subject to appropriate regulatory approvals.”

Geely reportedly secured the financing needed for the purchase earlier this month, which the Financial Times valued at about US$1.8 billion.

The newspaper said more than a billion would be loaned by the European Investment Bank and the Swedish and Belgian governments.

The Swedish media had questioned the ability of Geely, a relatively young player, to finance the takeover.

The deal was a “leap in the dark,” said the Dagens Nyheter newspaper, the day after the accord was announced.

But Svenska Dagbladet said Saturday that Geely’s chairman had given guarantees that all research and development activities would remain in Sweden and that production would first be assured by plants in Sweden.

Chinese Vice President Xi Jinping is due in Sweden this weekend but according to the Volvo spokesman, there are no plans for him at the moment to visit the company headquarters.

Geely boss Li earlier told China’s Xinhua news agency that the Volvo bid was related to a “new energy powered vehicle,” which he described as “the future of the world’s auto industry.

But on Saturday they pronounced themselves satisfied.

“We have received all the information that we were looking for,” Glenn Magnusson, head of the Ledarnas union, told Sweden’s TT news agency after two meetings with U.S.-based Ford and Geely management in Gothenburg on Saturday.

“As far as the unions are concerned, we are in favor of the agreement.”

Magnusson did not provide details on the talks with management, saying he and his colleagues from other unions had signed a confidentiality agreement.

Asked whether the Chinese company had given a guarantee that jobs would remain in Sweden, Magnusson said, “we have obtained a response to our questions.”

Volvo has 22,000 employees worldwide, including 16,000 in Sweden.

Ford Motor Company announced in December that it had agreed on the main terms of the sale of its loss-making Swedish subsidiary Volvo Cars to Geely, one of China’s largest private automakers, for a reported two billion dollars.

The deal will bring to an end Ford’s decade-long association with the premium Swedish brand, known for its sturdy, family-friendly cars.

Ford had said it anticipated “a definitive sale agreement will be signed in the first quarter of 2010, subject to appropriate regulatory approvals.”

Geely reportedly secured the financing needed for the purchase earlier this month, which the Financial Times valued at about US$1.8 billion.

The newspaper said more than a billion would be loaned by the European Investment Bank and the Swedish and Belgian governments.

The Swedish media had questioned the ability of Geely, a relatively young player, to finance the takeover.

The deal was a “leap in the dark,” said the Dagens Nyheter newspaper, the day after the accord was announced.

But Svenska Dagbladet said Saturday that Geely’s chairman had given guarantees that all research and development activities would remain in Sweden and that production would first be assured by plants in Sweden.

Chinese Vice President Xi Jinping is due in Sweden this weekend but according to the Volvo spokesman, there are no plans for him at the moment to visit the company headquarters.

Geely boss Li earlier told China’s Xinhua news agency that the Volvo bid was related to a “new energy powered vehicle,” which he described as “the future of the world’s auto industry.

The engine, which is set to replace a 2.5L five-cylinder model in various European Volvos, produces 203 hp and about 221 lb-ft of torque at 1750 rpm. Magnus Jonsson, head of Product Development at Volvo, said “We’ve succeeded in making a four-cylinder engine that is as powerful as a 2.5-litre five-cylinder unit, and it’s also much more energy-efficient.” How much more efficient? Volvo estimates it would achieve about 28 mpg.

Volvo says, the engine will be offered in Europe with a six-speed automatic or manual transmission. Powering S80s, V70s, and XC60s, the engine will initially be launched in South East Asia, the Netherlands, China, and Japan.

With the engine and an automatic transmission, the S80 will sprint to 100 kmh in 8.5 sec, the V70 in 8.9 sec, and the XC60 in 9.6 sec.

Volvo has revealed the first official images of its new 2010 S60 sedan that will make its world debut at the 2010 Geneva Motor Show next March.

Not much details about it, but on the safety side,Volvo says the S60 can be equipped with Pedestrian Detection, a safety technology that can detect pedestrians in front of the car and brake automatically if the driver does not react in time.

Read more after the press release:

Sculpted to move you – first pictures of the all-new Volvo S60

Here are the first official pictures of the all-new Volvo S60 – sportier and more dynamic than any previous Volvo model.

“Customers in this segment want emotional appeal, sporty design and dynamic driving properties. The S60 has it all. We are convinced that it will be one of the strongest contenders around,” says Stephen Odell.

Started last month, the SATRE project — or Safe Road Trains for the Environment — is an EU-backed initiative set on developing and testing technology for vehicles that can drive themselves. Key to this theory is what leaders are calling “road trains,” or groups of six to eight vehicles traveling on one route.

Each train has a lead vehicle with a person at the helm who knows the route very well, say, a bus or taxi driver. When drivers of the other vehicles need to get off at certain exit or take a turn, they simply retake control of their car and join another road train on the required route.

The advantages, SATRE managers say, are huge. It will improve fuel economy and lower the overall CO2 output of vehicles around the world thanks to the efficient drafting of vehicles only inches from each other. It is also pegged to improve traffic flow and shorten commuting time. Business can also be undertaken while on the move, because no human input is needed to drive.

Technological improvement will deal primarily with the vehicles themselves and not the existing roadway infrastructure, SATRE says. Navigation and transmitter systems control the acceleration, braking, and steering of the vehicles.

Though the concept is nothing new, the available and impending technology is. Past test runs of so-called autonomous vehicles were limited and could be considered fairly primitive compared to what SATRE has in mind.

Volvo is a main technology partner in the SATRE project and along with other partners believes such a way of travel is the future of transportation. Their test vehicles are slated to begin runs on closed tracks in 2011.

The whole idea of autonomous driving naturally conjures many serious questions. Do you believe this is the way of future transportation?

Source: Volvo