According to the Wall Street Journal Beijing Automotive Industry Corp is interested in buying Ford owned Volvo, adding a new name to a list of potential Chinese bidders for the Swedish car brand.
A team of BAIC executives is likely to visit Volvo's Gothenburg, Sweden, headquarters as early as Thursday to meet with its executives and tour its research and development and manufacturing facilities, the paper said, citing three people familiar with the situation.
A spokesman for state-run BAIC, China's fifth-largest automaker, said he was not briefed on the company's interest in any foreign auto brands. BAIC expressed an initial interest in General Motors' Opel earlier this month. Despite last month’s preliminary agreement with Canadian supplier Magna it is still in contact with the German government over Opel, Economy Minister Karl-Theodor zu Guttenberg said Thursday without providing further details.
Other potential Chinese buyers for Volvo that have cropped up in news reports include Geely Automobile Holdings, Ford's China partner Chongqing Changan Automobile Co., and Chery Automobile.
Stefan Elfstrom, a spokesman for Volvo Cars, declined to comment.
"Ford has said it is a process ongoing, but they haven't disclosed any names," Elfstrom said.
But analysts said Chinese firms, burned by past acquisitions that backfired, lack skill and stomach to take over the entire operations of their foreign counterparts, and are more likely bargain hunters for technologies and assets being sold in secondary sales.
"Don't take the reports seriously. Lots of so-called Chinese interest stories are leaked by investment bankers and lawyers trying to drum up deals," said Zhang Xin, an analyst with Guotai Junan Securities.
An industry source told Reuters that Beijing Automotive was interested in technology and designs which could then be used in its first self-developed car which it hopes to roll out in 2010.
Beijing Automotive currently only makes Mercedes-Benz and Accent cars at joint ventures with Daimler AG and South Korea's Hyundai Motor.
"BAIC doesn't even have an in-house design car brand so far. How can anyone realistically expect it to take over and turn around Opel or Volvo?" asked the source, who was not authorized to speak publicly on the matter.
One of the people told the Wall Street Journal that Beijing Auto's interest was "preliminary" and "nascent."
Source: Automotive News Europe
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