Volvo Investing £6 Billion to Develop New Product

Since Geeley bought Volvo in 2010, it has seemed that it might let the Swedish brand whither on the vine, but the new V40 was the first indication that Volvo might still be able to create new cars. However, Volvo has just announced that it will invest £6 billion in new product and increased production. 

"It is not Geely investing $11 billion," said Volvo spokesman Per-Ake Froberg clarifying where the money is coming from.

Much of the money will be spent in China. Volvo plans to develop cars specifically for China, build an engine factory in China, increase research and development and improve technology. It wants to be able to sell 800,000 cars a year worldwide within the next 10 years and control 20% of the Chinese premium car market. 

"We want to revive Volvo and give the brand its strength back," said Geely President Li Shufu.  

Volvo will borrow the money and use money that it has already saved to finance the development.  

Source: Reuters