Volvo wants bigger loan from EIB to make green cars

2011 Volvo V60

Volvo Cars, now owned by Chinese manufacturer Geely Automobile, is seeking a bigger European Investment Bank loan than had been previously planned. Volvo now plans to seek 600 million euros from the EIB, as opposed to the 500 million originally planned. The company also mentioned that they were in talks with the Swedish government about possibly guaranteeing the loans so that it may commence with the development and production of environmentally friendly vehicles.

An original loan of 200 million Euros was granted to Volvo back in March of 2009, before Geely’s purchase of the company from Ford Motor Company.

“Time has gone by, so we are now talking about a different timeframe. Instead of 2009 to 2012, this now concerns projects running from 2010 to 2013 and that effects the sum we are borrowing,” said Volvo spokesman Per-Ake Froberg.

Earlier in the year, Geely had mentioned that while it remained open to a possible loan from the EIB, it had all financing in place for its takeover. Carmakers all across Europe have been calling for loans backed by governments so that they could develop less-pollutive vehicles in the face of the automotive crisis.

– By: Stephen Calogera

Source: Automotive News (Subscription Required)