geely.jpgIt was a nice story while it lasted. However, Chinese carmaker Geely today denied media speculation that it wanted to buy either Volvo or Saab, the two luxury European marques that have been put up for sale by their beleaguered US owners Ford and General Motors respectively.

Geely chairman Li Shufu said his company is not keen to buy foreign brands and has not held discussions to buy Volvo or Saab, but may be interested in buying some automobile parts businesses abroad.

The Wall Street Journal earlier this week claimed that Geely, one of China's top ten auto makers by sales volume, was planning to submit a bid later this month to acquire Ford's luxury Volvo car brand.

EngagingChina argues that most Chinese carmakers have enough on their plate trying to cope with an oversupplied and rapidly evolving domestic market to want to undertake risky adventures overseas, particularly in mature western markets.

No matter how attractive an establish European marque may at first appear to upstart emerging market manufacturers, the businesses they want to acquire come with a lot of baggage — strong unions, mature markets, old factories, cultural issues, etc, etc.

MG Rover, the UK sports car marque, eventually went to a Chinese buyer but I suspect that is the exception to the rule. Nanjing Automobile, now part of SAIC, bought the assets of the collapsed MG Rover in 2005 and restarted production of MG sports cars in China in 2007.

More on the MG Rover saga in these EngagingChina stories, and on Geely here.

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