Drop The Fears of China Soiling Volvo's Reputation

Phil LeBeau | @Lebeaucarnews

Published 10:35 AM ET Wed, 23 Dec 2009 Updated 11:29 PM ET Wed, 17 March 2010 CNBC.com

Maybe it's because the Chinese are new to the auto game.

Maybe it's because Americans automatically think, "we invented the car business and nobody can do it better than us."

Or maybe it's because some people are worried the Chinese will grow Volvo and become an increasing threat to the Big 3.

Whatever the reason, this fear of the China based Geely ruining the reputation of Ford is absurd. It reminds me of the snide remarks made ten years ago when Ford bought Volvo. Back then, the elitists said Ford would drag Volvo down and the brand known for quality and safety would become nothing more than a once great European brand with a reputation that didn't match reality. Just as the elitists were wrong 10 years ago, I think those fearing Geely's purchase of Volvo are also wrong.

The Chinese, including Geely have been anticipating when they would finally branch out and become a major player outside of the auto market in China. With Volvo, Geely gains access to the European and U.S. markets. It also takes control of an automaker with incredible facilities and know-how about safety and technology. It's a big deal. And Geely doesn't want to blow it.

How can I be certain they won't screw up Volvo? Nobody knows for sure what will happen over the next decade. But the Chinese automakers have been studying how the Japanese companies grew in the 70's and how the Koreans came on strong in the 90's. They've also hired many of the execs that helped make the Korean car companies so competitive. In short, they know they have a chance with Volvo to rapidly accelerate their auto business and they don't want to blow it.

Just as Ford tapped Volvo's expertise to improve the quality of its vehicles, Geely will do the same thing. It will try, like Ford, to also grow Volvo's sales. And just as Ford found out over the last decade, Volvo is niche brand in a market where the niche players are finding harder and harder to thrive. My guess is Volvo will do ok under Geely, and for now, the Chinese automaker can live with that.

However you feel about the Chinese auto companies, keep this in mind: they're coming. Volvo is just one more important step in the growing expansion of the Chinese automakers.