Volvo and Geely tighten collaboration
Volvo and Geely have agreed on a wide-ranging partnership to combine powertrain operations in a new standalone company, enhance collaboration in autonomous and electric vehicles, develop joint procurement strategies and promote global expansion.
Both companies will still retain independent corporate structures.
Following a detailed review of combination options, the companies have concluded they can secure new growth opportunities and meet evolving industry challenges through deeper cooperation, while preserving their existing separate corporate structures.
Through the collaboration, the two companies will focus on the development and sourcing of next-generation technologies, from connectivity and autonomous drive to car sharing and electrification. They are planning to share and jointly source batteries, electric motors and connectivity solutions that will generate valuable synergies. This will include the joint development of a world-leading autonomous driving (AD) solution under the lead of Zenseact, Volvo Cars’ AD software development company.
However, they have confirmed the combination of their existing powertrain operations into a new standalone company which is expected to become operational this year, providing internal combustion engines, transmissions, and next-generation dual-motor hybrid systems for use by both companies as well as other automobile manufacturers.
Leveraging Volvo Cars’ existing distribution and service network, the two companies will also collaborate on the global expansion of the jointly owned Lynk & Co brand.
Håkan Samuelsson, president and CEO of Volvo Cars, said: “Having evaluated different options to realise value, we concluded jointly that a collaboration model between two standalone companies is the best way to secure continued growth and at the same time achieve technological synergies in many areas. We welcome the opportunity of further and deeper collaboration with Geely Auto.”
An Conghui, president and CEO of Geely Auto, said: “Geely Auto looks forward to partnering more closely with Volvo Cars, achieving significant synergies for our respective businesses. This will enable Geely Auto to accelerate its global expansion, to capitalise on our strengths in China and develop a new generation of world-class new-energy vehicles and associated mobility services.”
