Photo: Volvo
Volvo Cars has announced a strategic move in its direction to become a fully electric manufacturer by 2030. The Swedish marque that is owned by Geely Holding has divested its 33-percent stake in Aurobay, a company that makes hybrid and plug-in hybrid parts, to Geely.
The idea is for Volvo to ensure it does not manufacture any more combustion-engined vehicles by 2030. In case you were unaware of Aurobay, worry not, as it was established in 2021 as a separate entity from Volvo Cars Powertrain Engineering in Sweden, along with its engine plants in China, the related Research and Development teams, and all other relevant assets.
In other words, almost two years ago, the Volvo Car Group turned its internal combustion engine manufacturing department into a separate company, which had factories in Sweden and China, and the Swedish marque's stake in that separate firm has now been divested to Geely.
Volvo Cars has not specified too many details of the transaction, so no financial aspects of the arrangement will be known. However, it has been specified that the proceeds from the divestment will be used in the Swedish marque's transformation to a fully electric company, including its new production line for electric motors in Skövde.
The same city had a Volvo engine plant and the accompanying research and development team, so most (if not all) of those qualified and talented employees will continue to have work to do for Volvo once the deal is done.
It is important to note that Volvo has not mentioned anything related to the employees of Aurobay, so we are just guessing what might happen, but we will have to wait and see what will be decided after the deal is concluded.
For the moment, the transaction needs to be verified to receive the necessary regulatory approvals. Volvo Cars notes that it expects the process to be concluded by the end of 2022, but it depends on the relevant authorities.
In other words, almost two years ago, the Volvo Car Group turned its internal combustion engine manufacturing department into a separate company, which had factories in Sweden and China, and the Swedish marque's stake in that separate firm has now been divested to Geely.
Volvo Cars has not specified too many details of the transaction, so no financial aspects of the arrangement will be known. However, it has been specified that the proceeds from the divestment will be used in the Swedish marque's transformation to a fully electric company, including its new production line for electric motors in Skövde.
The same city had a Volvo engine plant and the accompanying research and development team, so most (if not all) of those qualified and talented employees will continue to have work to do for Volvo once the deal is done.
It is important to note that Volvo has not mentioned anything related to the employees of Aurobay, so we are just guessing what might happen, but we will have to wait and see what will be decided after the deal is concluded.
For the moment, the transaction needs to be verified to receive the necessary regulatory approvals. Volvo Cars notes that it expects the process to be concluded by the end of 2022, but it depends on the relevant authorities.
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