Will China's BYD Bring the F3DM to the U.S. or will this be Just Another Broken Promise?

When it comes to making cars,China is king. We’re talking the world’s largest car market, with over a hundred individual marques. So why is it that there are virtually zero Chinese car manufactures selling cars in the U.S. aka the world’s other largest car market?

So far, China’s “Big Four” (well, the four most visible to those outside of China) have made and broken promises of bringing their vehicles to the North American market. Brilliance, Chery, Nanjing and Geely have all backed down from their plans to open dealerships and factories stateside. So far, not a single car from China's major automakers has touched down on U.S. soil outside a motor show.

Senior analyst Bill Visnic of Edmunds.com explains why: “This isn’t computers or cellphones, where you just get into a big-box store. You need some dealerships, and those things are tremendous investments of time and resources. [The Chinese] thought it was going to be a lot easier than it was.”

BYD hopes to change all that. China’s sixth largest automaker provided plug-in hybrid cars to the 2008 Beijing Olympics and now plans on bringing that hybrid, the awkwardly , named F3DM to the U.S.A. for Spring 2012. It still could be an uphill challenge, though.

The fallout from the slump in auto sales after the Global Financial Crisis, the government’s bailouts of two of the Big Three, the liquidation of numerous dealerships and the reduction in hybrid sales that came with the sudden drop in fuel prices is still being felt in much of America’s automotive heartland. Add to that the small market share commanded by hybrid and electric vehicles – just 2.2% worldwide according to JD Power – and BYD may be in over their heads already.

AS Mike Omotoso from JD Power explains:

“Because consumers are wary about electric vehicles and their driving range and batteries, they are even more likely to go with more established companies like G.M. and Nissan. The problem with the Chinese car companies is they are trying to run before they walk.”

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Will China's BYD Bring the F3DM to the U.S. or will this be Just Another Broken Promise?

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China's Geely Completes Takeover of Volvo from Ford

Chinese carmaker Zhejiang Geely Holding Group Co. (simply known as Geely) completed the purchase of Volvo Cars from Ford Motor Co. on Monday. According to Ford, Geely paid $1.3 billion in cash today and issued a $200 million note for the acquisition of the Swedish carmaker. The exact amount of the final sale price will be announced later this year when the final adjustments on Volvo's value are made, and could result in additional proceeds to Ford.


"Volvo is an excellent brand with a strong product line, and it has returned to profits after a successful restructuring. We are confident Volvo has a solid future under Geely's ownership," said Alan Mulally, Ford's president and CEO.


"At the same time, the sale of Volvo will allow us to sharpen our focus on the Ford brand around the world and continue to deliver on our One Ford plan serving our customers with the very best cars and trucks in the world."


Under the agreement, Ford will continue to cooperate with Volvo in several areas supplying powertrains, stampings and other vehicle components. It will also provide engineering support, information technology, access to tooling for common components, and other selected services for a transition period.


The Detroit automaker added that it has also come to an agreement with Geely on the use of intellectual property.


As previously announced, Stephen Odell, CEO of Volvo Car Corporation, will return to Ford as group vice president and Chairman and CEO of Ford Europe. Stuart Rowley, CFO of Volvo Cars, will also head back toFord as chief financial officer, Ford Europe.


"Volvo is a proud company with a talented and dedicated team of employees," said Odell. "I am especially pleased that with Ford's continued investment in recent years, Volvo is well positioned for the future with an exciting range of products that remain true to its core values – safety, quality, environmental responsibility and modern Scandinavian design."


Geely has announced that Volkswagen's former U.S. Chief Stefan Jacoby will replace Odell and become CEO of Volvo Car starting from this month.

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Ford Confirms Deal with China's Geely on Volvo Sale

While General Motors is still trying to figure out what it's going to do with its Saab division, Ford Motor Company announced today that it has settled all substantive commercial terms with China's Geely Holding Group Company Limited on the prospected sale of its Volvo unit.

Ford added that while some work still needs to be done before the deal is sealed such as final documentation, financing and government approvals, the company anticipates that a definitive sale agreement will be signed in the first quarter of 2010, with closing of the sale likely to occur in the second quarter of the same year.

"The prospective sale would ensure Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement its core ONE Ford strategy," Ford said in a statement,

The Detroit automaker added that it would continue to cooperate with Volvo Cars in several areas after the sale, but it does not plan to retain any shares in the business.

It is said that Geely is offering the U.S. automaker somewhere around $2 billion dollars for Volvo Cars which is less than a third of what Ford paid for the Swedish brand a decade ago.

With the prospected sale of Volvo, Ford will offload the last brand in the Premier Automotive Group that also included Jaguar, Land Rover and Aston Martin.

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