Carmakers Swedish-based Volvo and Chinese-based Geely have completed the formation of two new entities to share existing and future car technologies.
The car manufactures believe the partnership will provide the economies of scale that will allow them to more rapidly develop next-generation electrified vehicle technology.
A new technology joint venture will be formed called GV Automobile Technology. It will be 50/50 owned by Volvo Cars and Geely Holding and headquartered in China with a subsidiary in Gothenburg, Sweden.
Lars Danielson, former SVP of Volvo Cars and CEO of Volvo Cars Asia Pacific, will become chairman of GV Technology, which will seek synergy benefits for Volvo Cars, Geely Auto and LYNK through two units controlling technology access as well as procurement.
A separate LYNK company, fully responsible for the LYNK car line, will also be formed, jointly owned by Volvo Cars, Geely Holding and Geely Auto, with a newly constituted board of directors.
An Cong Hui, president and CEO of Geely Auto, has been named chairman of the board of LYNK, and Hakan Samuelsson, president and CEO of Volvo Cars, will serve as board director alongside Daniel Li, executive vice-president and CFO of Geely Holding, and Feng Qing Feng, group vice-president and CTO of Geely Auto.
"These joint ventures will create significant value for our automotive brands. We aim to deliver global economies of scale by facilitating closer co-operation between our brands on shared vehicle architectures, powertrain development and electrification, while offering synergies that will enable LYNK to achieve its full potential," says Li Shufu, chairman of Geely Holding.
Volvo Cars will hold 30% of the shares in LYNK, while Geely Auto will hold 50% and Geely Holding 20% of the new company. Volvo Cars' significant minority shareholding reflects its support of the LYNK brand both now and in the future, the Swedish carmaker says.
Volvo and Geely already share technology, including the Compact Modular Architecture platform, which is being used by Volvo for its soon-to-be-announced smaller range of 40 series cars.
"We look forward to expanding our co-operation with LYNK. It will be beneficial for both companies," says Samuelsson.
The formation of the LYNK company is expected to be finalised in September.
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