A local government official has told the China Business News that Volvo's China base is to be located in Jiading, a district of Shanghai. According to the official, the Jiading government has completed all the necessary preparations, including assigning land.

The official refused to confirm a rumor that the precise location will be Xuhang Town in Jiading. He said the final decision on location will be made public after Geely Automobile finalizes its takeover of Volvo in August.

The auto industry is the most important industry in Jiading District. Local industrial output reached 47.3 billion yuan in the first quarter of 2010, of which 38 percent or 18 billion yuan was derived from the car industry.

Beijing Geely Wanyuan International Investment Company and Shanghai Jia'erwo Investment Company established the Shanghai Geely Zhaoyuan International Investment Co. on February 24 this year. The new company will take charge of Volvo operations in Jiading.

Jia'erwo Investment Company was established by the Jiading State-owned Assets Supervision and Administration Commission and Jiading Industrial Zone. Geely Wanyuan was established by Geely Automobile and the Daqing State-owned Assets Supervision and Administration Commission.

China's business press carried the story above on Monday. China.org.cn has not checked the stories and does not vouch for their accuracy.