* 922 mln euro loan to refinance existing loans
* Aims for further loans under the deal to finance
* Pays back EIB loan ahead of time
(Adds company comment, background)
By Anna Ringstrom
STOCKHOLM, Dec 13 Chinese-owned car maker Volvo
Car Corporation has agreed a loan from China Development Bank
to repay existing debt and hopes for more to help
finance the investment it needs to double vehicle sales.
Volvo, which has scaled back production at its main plants
in response to weakening demand in Europe, said on Thursday it
had signed a 922 million euro ($1.2 billion) loan.
Spokesman Per-Ake Froberg said that, as a second step under
the loan agreement, the firm hoped to secure credits to be used
to help finance investments amounting to $11 billion, half of
which will be spent on a production upgrade in
Volvo has said it will invest $11 billion as it aims to
double total sales by 2020 to 800,000 vehicles.
"We are developing an entirely new vehicle architecture that
will be very important and that will of course need to be
financed," he said.
The maker of premium cars, which Zhejiang Geely Holding
Group bought from Ford Motor Co in 2010, says
the investment will cut costs and help sales of its cars buck
the market downturn.
Recently appointed Chief Executive Hakan Samuelsson said
last week he saw no positive signals in the European market
while North America was "coming back" and that China was still
growing, albeit at a slower pace.
The first loan matures in 2020, the company said.
Sweden's debt office said separately that Volvo Cars had
paid back a loan from the European Investment Bank ahead of time
following the agreement with China Development Bank.
($1 = 0.7669 euros)
(Reporting by Stockholm newsroom; Editing by Erica Billingham)