Zhejiang Geely Holding Group has signed up Johnson Controls (JCI) to be its global parts supplier. According to an official statement, Johnson will cooperate with Geely in the clean energy sector.
In the last three years, Geely, similar to other Chinese automakers, has been struggling hard to enhance its global profile by upgrading its technology to the international standards. In this effort, the company has rejected 385 companies from among its pool of suppliers.
Geely is also a preferred bidder for Ford’s (F) Swedish brand, Volvo. So far, Geely has submitted the only concrete bid for the unit. Media reports have disclosed that Geely valued the unit at close to $2 billion.
Geely aims to complete its acquisition of Volvo in early 2010. The deal is backed by the Beijing Government. Three major Chinese banks, including Bank of China, China Construction Bank and Export-Import Bank of China have agreed to extend loans to Geely for the deal.
Recently, China’s fifth largest automaker, Beijing Automotive Industry Holding Group (BAIC), has agreed to buy technology from General Motor’s Swedish brand, Saab Automobile. According to the deal, BAIC will buy the rights to certain powertrain, engine and gear-box technology for Saab’s 9-5 and 9-3 sedans.
BAIC showed its interest in Saab in order to upgrade its own technology and expand production. Due to the lack of in-house brands, BAIC has decided to set up production in China based on an older generation of Saab vehicles.
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