Geely 'favourites to buy Volvo'

Chinese manufacturer Geely has emerged as the leading contender to takeover Volvo from Ford, according to a report from the US.

Ford is currently examining a bid from Geely for Volvo, which is believed to be worth $2.5 billion (£1.5bn).

The report in the Wall Street Journal claimed the bid was much higher than Ford or outsiders had expected for Volvo, a brand which is believed to have lost more than $1bn (£625m) in recent years.

However, one sticking point could be Geely’s demands to only take on Volvo’s assets, such as its safety technology and factories, and would not want to be involved in any post-Ford restructuring process, taking on pension debt or unwanted inventory.

Volvo’s technology is expected to be a crucial part of the deal and Ford isn’t keen to see a brand which is expected t become a rival in Europe and Asia benefit from it.

Last month, Ford’s chief financial officer Lewis Booth, said: “We expected this to be a pretty long process because of the environment we're working in.

“We haven't got an explicit timetable. We're still talking to interested parties. We're working through the options.

Ford CEO Alan Mulally said today that talks to sell Volvo were progressing.

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