Shanghai (ZXZC)- Geely Automobile Holdings Limited (Geely Auto) and Volvo Cars have already found the best solution for combining their businesses, the HK-listed automaker announced on Feb. 24.

According to the solutions, both parties will carry out a series of business combination and cooperation on powertrain, electrification, autonomous driving and other operations while maintaining their respective independent corporate structure.

The agreement came after Geely Auto announced in Feb. 2020 that it was in discussions with Volvo Cars regarding the possible restructuring through the business combination of two parties.

Photo credit: Geely Auto

Specifically, they will combine powertrain operations into a new company through equity merger in order to offer powertrain products to both parties and develop powertrain products and next-generation dual-motor hybrid system (available for both hybrid electric vehicles and plug-in hybrid electric vehicles) for them. The post-merger venture will start operation this year and will provide products and services for other automakers.

As for electrification, riding on the current sharing of two modular EV architectures, namely Sustainable Experience Architecture (SEA) and Scalable Product Architecture 2 (SPA 2), two parties will co-develop the next-generation modular electric vehicle architecture for use by Geely Auto, Volvo Cars, the Lynk & Co brand and the Polestar brand. Besides, they will also share technologies on electrification (including battery packs and electric drive systems) and intelligent connectivity, and carry out joint procurement to reduce costs.

Regarding autonomous driving, the two parties will jointly develop autonomous driving solutions under the lead of Zenseact AB, an autonomous driving software development company wholly owned by Volvo Cars.

Moreover, the Lynk & Co brand, which officially tapped Europe last year, will gradually provide global consumers with its services through overseas sales channels and after-sales network of Volvo Cars.