HANGZHOU, CHINA - China’s Geely Holdings has owned Volvo Cars for just over a decade, and although technology sharing has been implemented between the two brands, those ties are set to deepen in the coming years as part of a new governance model.
This will include the development of both internal combustion and electric cars.
To that end, the two brands’ existing powertrain operations will be merged into a new standalone company, which is expected to become operational this year. The new outfit will provide internal combustion engines, transmissions, and next-generation dual-motor hybrid systems for use by both companies as well as other carmakers.
Volvo Cars and Geely Auto will also focus on the joint development and/or sourcing of future tech, such as, connectivity, autonomous driving hardware and electric powertrains. This will include the joint development of a world-leading autonomous driving solution under the lead of Volvo’s software development company Zenseact.
The two companies are also planning to share their new SEA and SPA2 electric architectures among their brands.
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.
“Following a detailed review of combination options, Volvo Cars and Geely Auto have concluded they can secure new growth opportunities in their respective markets and meet evolving industry challenges through deeper cooperation, while preserving their existing separate corporate structures,” Volvo said.
Geely Auto CEO An Conghui added: "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."