Geely and Volvo announce a merger to form a new powertrain company
China Car News, February 24, Volvo Cars and Geely Automobile jointly announced this evening that the two parties have reached the best merger plan. While maintaining their existing independent company structures and achieving their strategic goals, continue to expand cooperation areas, deepen cooperation in the new four modernizations (electrification, intelligence, connectivity, and sharing) of the automobile, exert synergy effects, and truly achieve business integration The greatest value of the company, strengthen technological advantages, and continue to lead industry changes. In order to promote the above cooperation, Geely Automobile and Volvo Cars will also establish a new coordination management mechanism to ensure the efficient and smooth implementation of various projects.
Li Shufu, Chairman of Geely Holding Group, expressed his support for the merger plan and cooperation consensus: 'At present, the global automotive industry is facing profound changes. We must seek openness and coordination, and unite. This time Geely Automobile and Volvo Cars Further integration of business and establishment of closer strategic synergies can achieve the best merger effect. This will create two stronger companies in the rapidly changing automotive technology and travel service fields, create a new development pattern, and continue to lead the development of the industry.'< /p>
According to the consensus content of the cooperation, Geely Automobile and Volvo Cars will focus on the forward-looking technologies of the new four modernizations of automobiles, merge and collaborate in business areas such as powertrain, three-electric technology, and highly automated driving, and continue to promote technological innovation. The two parties merged the powertrain business in the form of equity merger to establish a new company, focusing on the development of a new generation of dual-motor hybrid power systems and high-efficiency internal combustion engines. In addition to continuing to supply both parties, it also provides products and services to third-party automotive companies. The company plans to start operations before the end of the year.
In the field of smart electric vehicles, based on the current shared SEA and SPA2 electric vehicle architectures, the two parties have launched the joint development of the next generation of pure electric exclusive modular architectures, realizing the sharing of core technology achievements and the advantages of scale . Volvo, Geely, and fast-growing Lynk u0026 Co and Polestar brands will all share this structure. The two parties will also realize technology sharing in terms of three power and intelligent network connections, share battery packs and electric drive systems, and reduce costs through joint procurement. This will further enhance Geely Automobile's new energy research and development capabilities, and provide strong support and guarantee for Geely Automobile to become a new four-generation automobile company.
In the field of advanced autonomous driving technology, the two parties will jointly develop the world's leading highly autonomous driving solutions based on their own rich research and development results and experience, led by Volvo Cars' autonomous driving software technology development company Zenseact.
The two parties will continue to deepen the synergy in sales channels and after-sales service to achieve complementary resources. Lynk u0026 Co., a new global high-end brand jointly created by the two parties, officially announced its entry into Europe at the end of last year. Lynk u0026 Co will make full use of Volvo Cars' overseas channel resources to gradually serve global users.
Through this move, existing stakeholders and potential investors of Volvo Cars and Geely Auto can evaluate the strategies, performance, financial risks and returns of the two companies respectively, and make more flexible and effective investment decisions. Volvo Cars may have the opportunity to explore various options in the capital market in the future.
