The company is also the latest in a line of Geely's acquisitions outside its native China, including Volvo seven years ago as well as a more recent purchase of a 49.9% equity stake in Malaysian automaker Proton, and a 51% stake in British sports auto maker Lotus.
Geely, which owns a stake in national carmaker Proton, said it had received the necessary approval for the deal, including from the USA government's Committee on Foreign Investment, to take over all of Terrafugia's operations and assets.
Geely has announced it has taken over US-based Terrafugia Inc, which has made headlines for developing and displaying flying cars for many years but not yet selling any.
The two companies plan to utilise their respective expertise to further the development of flying cars, with Terrafugia already having tripled its United States engineering team as part of an expansion ahead of the takeover.
If you've been dreaming of a flying vehicle since you were a child, have patience - there may not be long to wait before flying cars become an ordinary part of everyday life around the world.
Terrafugia was set up by graduates from the Massachusetts Institute of Technology in 2006.
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Under the acquisition terms, Terrafugia is expected to be domiciled and headquartered in the U.S. and will continue to focus on developing flying cars.
Geely International business vice president and executive advisor to the board Nathan Yu Ning will become Terrafugia chairman. "Now as part of Geely Holding Group, I am confident that we can reach that vision and subsequent commercial success by utilizing the groups' shared global synergy".
Geely says it's investing in Terrafugia to make flying cars a reality. Dietrich will remain in the company as chief technology officer, a newly created position, after the acquisition. 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 vehicle a reality.
However, the company did not disclose any financial details concerning the deal, The China Daily newspaper reported today.
Francis Kwok Sze-chi, managing director at Freeman Securities in Hong Kong, told NQN: "Demand for "flying cars" is promising in China where traffic congestions are chronic headaches".