Hangzhou: Zhejiang Geely Holding Group (Geely Holding) has formed two new joint ventures with Volvo Cars to co-operate on automotive technologies, purchasing and the future development of the LYNK & CO brand.
The LYNK & CO brand will develop and sell new high end cars primarily targetting for the North American and European markets.
Malaysia will also likely be a market for the new manufacturer, said Geely Auto Group chief executive officer (CEO) An Cong Hui.
"LYNK & CO is global brand, so it's a global development. Surely it will find its way to Malaysia," said An at the signing ceremony here today.
LYNK & CO is ready to release their model 01 SUV in the fourth quarter this year, and their new model 03 sedan in the first quarter of 2018. All three brands, Geely, Volvo and LYNK & CO will maintain their independent brand identities and target different segments of the markets.
Geely Holding and Volvo, its wholly-owned Swedish subsidiary, today signed the wide-ranging agreement to formalize the joint ventures, covering the strategic priorities, management teams and targeted synergies for the collaboration projects.
“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 in a media statement.
Under the agreements signed, a new technology joint venture company will be formed named GV Technology (Ningbo) Co. Ltd., which will be equally owned by Volvo Cars and Geely Holding with its headquarters in China with a subsidiary in Gothenburg, Sweden.
Former SVP of Volvo Cars and CEO of Volvo Cars Asia Pacific, Lars Danielson, will become the Chairman of GV Technology. The joint venture will seek synergy benefits for Volvo, Geely Auto and LYNK & CO through two divisions in technology and purchasing.
The new outfit, GV Technology, operated by Geely Auto and Volvo, will make available all current vehicle architectures and powertrains from the respective companies to their partners. The partnership will cooperate on next-generation automotive technologies, including electric platforms.
“The JV will also generate significant synergies, shared development costs and procurement cost savings for Geely and Volvo,” said Danielson.
A separate LYNK & CO joint venture was also signed today, which will be jointly owned by Geely Auto (HK 0175) (50 per cent), Geely Holding (20 per cent) and Volvo cars (30 per cent).
With this LYNK & CO joint venture, the brand will gain access to technology and business support from Volvo, and the Swedish company’s Scalable Product Architecture (SPA), its advanced modular architecture and the latest powertrain products and technologies.
The two joint ventures began with the collaboration between Geely and Volvo, which was acquired by the Chinese group in 2010.