Volvo Cars and the premium automaker’s parent, Geely Holding have completed the formation of two new entities which they said would share existing and future technology and provide the economies of scale to more rapidly develop next generation electrified vehicle technology.
The agreements, signed at a ceremony in Ningbo, China, formalise the strategic priorities, management teams and targeted synergies for the collaboration within the group.
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A new technology joint venture will be formed called GV Automobile Technology (Ningbo), 50/50 owned by Volvo Cars and Geely Holding and based in China with a subsidiary in Gothenburg, Sweden.
Lars Danielson, a 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 & Co through two units controlling technology access as well as procurement.
A separate Lynk & Co company, fully responsible for the Lynk & Co 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 Lynk & Co and Håkan Samuelsson, president and CEO of Volvo Cars, will serve as a director alongside Daniel Li, CFO of Geely Holding and Feng Qing Feng, 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 cooperation between our brands on shared vehicle architectures, powertrain development and electrification while offering synergies that will enable Lynk & Co to achieve its full potential,” said Li Shufu, Chairman of Geely Holding.
Volvo Cars will hold 30% of the shares in Lynk & Co while Geely Auto will hold 50% and Geely Holding 20% of the new company. Volvo Cars’ significant minority shareholding reflects support for the new brand.
Volvo Cars and Geely already share technology, notably the Compact Modular Architecture (CMA), which will underpin Volvo’s next 40 series cars and those of Lynk & Co.
The formation of the Lynk & Co company is expected to be finalised in September and is subject to relevant corporate and authority approvals.
The brand has run into difficulties in the US with Ford claiming it sounds too much like its own Lincoln brand.
