Flying auto company Terrafugia bought by China's Geely

Chairman Li Shufu has made sure Geely can check all the boxes from autonomy to urban mobility

Chairman Li Shufu has made sure Geely can check all the boxes from autonomy to urban mobility

Today, Zhejiang Geely Holding Group, owner of Volvo Car, announced that it has reached an agreement with Terrafugia Inc.to acquire the activities and assets of the USA company.

Terrafugia strives to market the first flying vehicle in the world with the Vertical Take Off and Landing (VTOL) in 2019.

Terrafugia was founded in 2006 by a group of MIT graduates, and is understood to be the furthest along among its peers in its development of flying cars. And in anticipation of the deal, Terrafugia has tripled the size of its engineering team over the past quarter. Although the company will be under the wing of the Chinese, it will maintain autonomy over its major research and development capabilities and production facilities, while looking to synergize with Geely in accelerating development.

Geely, which owns a stake in national carmaker Proton, said it had received the necessary approval for the deal, including from the U.S. government's Committee on Foreign Investment, to take over all of Terrafugia's operations and assets. A former managing director at Bell Helicopter, Chris Jaran, has been appointed CEO of Terrafugia.

The Chinese automotive giant, which also owns Volvo, said Terrafugia would benefit from its significant expertise and track record of innovation across the globe.

Meanwhile, Terrafugia founder Carl Dietrich is staying on as the company's chief technology officer.

"This is a tremendously exciting sector and we believe that Terrafugia is ideally positioned to change mobility as we now understand it and herald the development of a new industry in doing so". We are committed to extend our full support to Terrafugia, leveraging the synergies provided by our global operations and our state track record of innovation to make the flying auto a reality. Shares in Geely Automobile Holdings, the Chinese company's core Hong Kong-listed subsidiary, soared to an all-time high of 28.4 Hong Kong dollars, immediately following the announcement on Tuesday.

People may dream of flying cars, especially when they are stuck in a traffic jam.

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