China’s Volvo owner boosts profit on Chinese boom
The Chinese owner of Volvo Car said full-year profit at its local car making unit probably doubled, topping analysts’ estimates and allowing billionaire founder Li Shufu to turn his focus to another major acquisition in Sweden.
Net income at Geely Automobile Holdings increased “around 100%” from the 5.11 billion yuan (€653m) in 2016, the Hong Kong-listed unit of Li’s Zhejiang Geely Holding said.
The maker of Emgrand sedans and X7 SUVs is among car makers getting a boost in the world’s biggest car market, where sales rose to a record for a 27th consecutive year. Geely forecast deliveries will rise 27% to 1.58 million units this year after a surge in demand in 2017, which may place the company as the biggest-selling domestic brand in China, according to analysts.
That performance is already getting its reward in the stock market with shares of Geely more than tripling last year in Hong Kong.
Last month, the parent company Zhejiang Geely announced purchasing a stake in Swedish truckmaker Volvo.
The parent already owns the Volvo Car nameplate after purchasing it from Ford. In 2013, Zhejiang Geely agreed to purchase Manganese Bronze Holdings, rescuing the maker of London’s black taxis after the UK car maker entered administration.
Mr Li is turning his attention to the Swedish company’s heavy vehicles in a bid to bulk up outside China. The stake would mark Hangzhou-based Geely’s first foray into the heavy-truck segment.
