Volvo Cars and Parent Geely to Merge Combustion Engine Operations
07 October 2019 - 10:26PM
Dow Jones News
By Dominic Chopping
STOCKHOLM--Volvo Cars will merge its combustion engine
operations with that of its Chinese parent Zhejiang Geely Holding
Group Co., allowing it to focus on developing its all-electric
cars, the Swedish auto maker said Monday.
Volvo and Geely will merge their existing combustion engine
units into a stand-alone business, establishing a new global
supplier to develop next-generation combustion engines and hybrid
powertrains for use not only in Geely brands Geely Auto, Proton,
Lotus, LEVC and LYNK & CO, but also to third-party
manufacturers.
Volvo is in the process of developing an all-electric range of
cars and it said that by the middle of the next decade it expects
half of its global sales to be fully electric and the other half
hybrid, supplied by the new unit.
"Hybrid cars need the best internal combustion engines," said
Volvo Cars Chief Executive Hakan Samuelsson.
"This new unit will have the resources, scale and expertise to
develop these powertrains cost efficiently."
The merger concerns 3,000 Volvo Cars workers and around 5,000
Geely employees and the companies don't expect any cuts to the
workforce as a result of the move despite expecting substantial
operational, industrial and financial synergies.
Geely bought Volvo Cars from Ford Motor Co. (F) in 2010.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
October 07, 2019 07:11 ET (11:11 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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