Geely Expands European EV Manufacturing
Geely takes over part of Ford's Spanish plant to expand European EV production and mitigate tariffs
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Key Points
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Geely’s plan to build on Ford’s Body 3 line in Almussafes could enable EU-made vehicle classification, helping to dodge countervailing tariffs of 18.1% on top of the standard 10% duties when exporting to the EU.
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The European model under consideration is a European version of Geely’s EX2 (sold in China as the Xingyuan) built on Geely’s Global Intelligent New Energy Architecture (GEA) platform on the Valencia-area Body 3 line.
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Almussafes has capacity of about 450,000 vehicles per year but has been operating at well under a quarter of that, with the line and plant largely idle aside from the Kuga on Body 2; Ford had also floated potential layoffs of around 1,622 workers at the site as talks progressed.
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Geely’s involvement at Almussafes continues a long-running cross-border relationship that traces back to Geely’s 16-year-old acquisition of Volvo Cars from Ford, underscoring how blending Ford’s European footprint with Geely’s EV and platform technology can reshape European manufacturing.
Geely has agreed to take over part of Ford's Almussafes factory near Valencia, Spain, marking a major shift for one of Europe's most underused auto plants. Spanish Prime Minister Pedro Sánchez is set to announce the deal in person, underscoring the high political stakes for the region, according to CNEVPost.
The plant has capacity for about 450,000 vehicles per year but has been running at well under a quarter of that. Ford had also floated potential layoffs of around 1,622 workers at the site as talks progressed. The deal gives Almussafes a second life — and gives Geely a foothold in European manufacturing.
Geely Takes Over Idle Body 3 Assembly Line
Geely will build vehicles on the idle Body 3 line at Almussafes. Ford will keep running other parts of the plant, including the Body 2 line, where it makes the Kuga crossover, according to Automotive World. The two lines operate independently, so Geely can move in without disrupting Ford's existing output.
The vehicle Geely plans to build there is a European version of its EX2 — sold in China as the Xingyuan. It will be built on Geely's GEA platform, which stands for Global Intelligent New Energy Architecture. That platform underpins several of Geely's newer electric vehicles.
EU-Made Label Could Shield Geely From Steep Tariffs
Building cars in Spain gives Geely a key advantage: those vehicles could count as EU-made. That matters because Chinese-made EVs currently face countervailing tariffs of 18.1% on top of the standard 10% import duty when entering the EU. Manufacturing locally could let Geely avoid those extra costs entirely.
Bloomberg Law reported that Ford and Geely have agreed to share the underused factory, with the deal framed partly around using excess European capacity as a bargaining asset. For Geely, Spain is not just a factory — it is a way into the European market on better terms.
A Partnership Rooted in Geely's Volvo Acquisition 16 Years Ago
The Ford-Geely relationship is not new. It traces back 16 years to when Geely bought Volvo Cars from Ford. That deal planted the seeds of a cross-border manufacturing relationship that has grown ever since. Now, the two companies are sharing not just history but factory floor space, according to Automotive World.
The arrangement fits a broader strategy: blending Ford's European footprint with Geely's EV technology to cut shared costs. Market Screener noted that Geely, as owner of Volvo, Polestar, and other brands, brings deep EV platform experience that Ford can tap into as it navigates its own electric transition.
Jobs and Politics Push Spain to Back the Deal
Almussafes sits near Valencia and employs thousands of workers. With the plant running far below its 450,000-vehicle annual capacity, the threat of mass layoffs was real. Ford had flagged potential cuts of around 1,622 jobs, making the Geely deal a lifeline for the local economy, according to Bloomberg Law.
Prime Minister Sánchez's decision to announce the deal himself sends a clear signal. His government sees this as a win — for jobs, for Spain's auto industry, and for its role in European EV manufacturing. The announcement turns a quiet factory deal into a national moment.
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