The two new joint ventures formed by Volvo Cars and parent company Geely usher in a new era for their already close cooperation, one that Chairman Li Shufu describes as a “brotherly” relationship.
The JVs represent the first time a Chinese domestic automaker has signed a deal for full-technology-sharing and purchasing cooperation with a leading western brand, paving the way for Geely as it ramps production and launch of the LYNK & CO brand later this year and expands its global presence.
CBU/CAR believes there are two significant objectives of the two new JVs.
First, the tech JV will not only benefit the Geely, Volvo and LYNK & CO brands, but also essentially all of the sub brands under the Geely global umbrella – Lotus, Polestar, Proton, Yuancheng, LEVC, etc. All future architecture and technologies developed will also be made available to the joint venture under license for brands across the Group.
Second, the tripartite JV serves as the holding company for all relevant companies and assets engaged in the operation of the LYNK & CO business, including production, sales and aftersales services, essentially giving it a new home. It is also expected to broaden the income stream of Geely Auto. The LYNK & CO brand in the process also becomes a new JV independent brand from Geely and Volvo and China’s first premium JV independent brand. The brand will gain access to technology and business support from Volvo Cars, including the Swedish company’s Scalable Product Architecture (SPA), its advanced modular architecture and the latest powertrain products and technologies.
Maximize synergies, lower development cost, faster technology rollout and better utilize and share resources. These efforts will be crucial for Geely as its global empire balloons.