Volvo Cars and Geely Auto to Deepen Collaboration

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

  
Haring;kan Samuelsson, President and CEO of Volvo Cars

Håkan Samuelsson, President and CEO of Volvo Cars

Dubai, UAE:  Al-Futtaim’s Trading Enterprises - Volvo today announced that Volvo Cars and Geely Auto have agreed on a wide-ranging collaboration that will maximise the strengths of the Swedish and Chinese automotive groups, delivering synergies in powertrains, sharing of electric vehicle architecture, joint procurement, autonomous drive technologies and aftersales.

This includes:

  • Powertrain operations to be combined in new company focused on next-generation hybrid systems and internal combustion engines
  • Expanded use of shared modular architectures for electric vehicles (EVs)
  • Enhanced collaboration in autonomous and electric drive technologies
  • Joint procurement to cut purchasing costs
  • Lynk & Co to expand globally by utilising Volvo distribution and service network
  • Companies to retain independent corporate structures

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.

The deeper collaboration will enable existing stakeholders and potential new investors in Volvo Cars and Geely Auto to value their respective standalone strategies, performance, financial exposure and returns. We will also have the opportunity to explore capital market options. The collaboration will be overseen by a new governance model, supported by Geely Holding, the lead shareholder in both companies.

Volvo Cars and Geely Auto confirmed the combination of their existing powertrain operations into a new standalone company. The company, expected to become operational this year, will provide internal combustion engines, transmissions, and next-generation dual-motor hybrid systems for use by both companies as well as other automobile manufacturers.

The companies 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.

The two companies, which are planning to share the new SEA and SPA2 electric architectures among their brands, have launched combined efforts to drive speed and efficiencies in the development of hardware and software for the next-generation world-leading modular EV architectures. Intended sharing of platforms and architectures between the companies will drive additional synergies and allow for an expansion of product portfolios across the Volvo Cars, Geely, Lynk & Co and Polestar brands, and external partners.

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."

The collaboration agreement has been welcomed by Li Shufu, Chairman of Geely Holding, the parent company of Volvo Cars and the largest shareholder in Geely Auto.

“As shareholders and portfolio-managers of both wholly-owned and listed companies, Geely Holding sees significant benefits from deeper partnerships and alliances whilst maintaining independence,” said Li Shufu. “We are encouraged by the potential synergies and growth opportunities created by this collaboration, which will create two even stronger globally competitive companies in the rapidly changing world of automotive technology and new mobility services.”

A subsidiary of the Al-Futtaim Automotive Group, Trading Enterprises was established in 1970s in Dubai and is the exclusive authorized distributor for Volvo in the UAE. It is empowered by a highly skilled and trained professional team to provide a complete car buying experience. Al-Futtaim Automotive is one of five divisions within the Al-Futtaim Group which provides quality products and services that enrich people’s lives and aspirations each and every day. For more information on Volvo’s online services in the UAE, visit https://www.volvocars.com/en-ae/online-services

-Ends- 

About Trading Enterprises – Volvo

Trading Enterprises, part of Al-Futtaim Automotive, is the exclusive distributor of Volvo cars in the UAE since 1985. The ISO9001:2008 company represents the world-renowned Volvo cars brand well known for its intuitive innovations, safety, environmental performance and Scandinavian design through its sales and after-sales network in Dubai and Abu Dhabi.

Trading Enterprises – Volvo offers a complete range of premium mobility solutions in the premium segment that includes: Sedans (S60 and S90), Versatile estates (V60 and V90) and SUV vehicles (XC40, XC60 and XC90). Trading Enterprises is regarded as pioneers in the region by Volvo when it comes to adopting Volvo best practices and has introduced the region’s first Volvo Retail Experience Showroom and Volvo Personal Service – which offers a human-centric approach to sales and service.

For more information on Trading Enterprises – Volvo, please call 800 8823 or visit: https://www.volvocars.com/en-ae 

About Al-Futtaim Automotive

Al-Futtaim Automotive, one of the main five operating divisions within the UAE-based Al-Futtaim Group of companies, is a conglomerate of motoring-related businesses, franchising some of the world’s most-recognised automotive brands and services.

Operating in 10 countries across the Middle East, Asia and Africa and empowered by around 9,000 associates, the UAE-headquartered Group’s services span across distribution of new and used vehicles, manufacturing, leasing, and aftersales.

Ranging from passenger cars to SUVs, commercial vehicles, industrial and construction equipment as well as motorbikes and quads, Al-Futtaim Automotive Group offers an integrative customer-centric experience for motorists, fleet operators and contractors alike, and strives to become the leader in tailor-made mobility solutions

About Al-Futtaim

Established in the 1930s as a trading business, Al-Futtaim Group today is one of the most diversified and progressive, privately held regional businesses headquartered in Dubai, United Arab Emirates.

Structured into five operating divisions; automotive, financial services, real estate, retail and health; employing more than 42,000 employees in more than 20 countries in the Middle East, Asia and Africa, we partner with over 200 of the world's most admired and innovative brands.

Al-Futtaim’s entrepreneurship and relentless customer focus enables the organization to continue to grow and expand; responding to the changing needs of our customers within the societies in which we operate.

By upholding our values of respect, excellence, collaboration, integrity; Al-Futtaim continues to enrich the lives and aspirations of our customers each and every day. For more information visit: www.alfuttaim.com 

For more information, please contact:
Shady Fekry
Media and Influencer Relations Manager | Impact Porter Novelli
Tel: +971 4 330 4030 E: 423 | Email: s.fekry@ipn.ae 

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