Volvo Cars and Volvo Trucks, while sharing the same front name, have been separate companies for quite a while – but that’s about to end now with the surprising announcement that Chinese automaker Geely has opted for a stake in the commercial vehicle producer.
The company recently announced the investment of around $3.3 billion for a 8.2 percent stake in Volvo – AB Volvo – the latter splitting from Volvo Cars back in 1999. A reunion is not in the works, at least for now, even though both Volvos have very near headquarters, located in Gothenburg, Sweden. Geely has decided to take the stake in AB Volvo from investment company Cevian Capital, and that’s probably because it has become keenly interested in developing new mobility features – such as electric drive and autonomous technology – for heavy goods vehicles as well. By the way, AB Volvo is in turn the owner of a 45 percent stake in China’s Dongfeng Commercial Vehicles.
“Given our experience with Volvo Car Group, we recognize and value the proud Scandinavian history and culture, leading market positions, breakthrough technologies and environmental capabilities of AB Volvo,” commented in an official statement Geely Holding chairman Li Shufu. It’s interesting to see where the new management is heading with AB Volvo, since previously Cevian wanted the truck company to separate its construction equipment and engine units. Meanwhile, Geely is seemingly playing hard across the international automotive industry, with portfolio that includes LEVC, which produces the London Black Cabs, British sports car manufacturer Lotus, a minority stake in Malaysian car maker Proton and of course the flourishing Volvo Cars.