• New Modular Architecture to be developed for both Volvo Cars and Geely Auto to lead into the future

13 September 2013, Gothenburg, Sweden. Geely Group is excited to announce that the joint R&D Centre of Geely Auto and Volvo Cars in Gothenburg starts soft operation following the decision made in February this year. The Centre will embark on a focused program developing a modular architecture and components for the next generation leading C- segment cars for both Geely Auto and Volvo Cars.

This newly launched joint R&D Centre is an important step in consolidating Geely Group’s global footprint. In line with our strategy, the Group aims to leverage global technological resources in different business units to build world-leading R&D capabilities and teams, enhancing our ability to continuously innovate. Developed in accordance with international standards, the modular architecture will help achieve synergies through economies of scale and scope in terms of development, testing, and procurement, without slightest compromise on brand value of each. With independent platform, Volvo Cars will continue to focus on the global premium car market, while Geely Auto will remain servicing the mass market.

“The modular architecture is an important springboard for Geely Group’s sustainable development globally and benefits the growth of both Volvo Cars and Geely Auto. The architecture will provide Geely Auto with the tools to improve its products and technology significantly. Capital investment in the Centre will help drive the advancement of Volvo Cars’ technological breakthrough. Access to Geely Auto’s OEM suppliers in Asia is also made available to Volvo Cars for procurement optimisation as needed.” An Conghui, President of Geely Group, said in the ceremony. He continued: “We have put together outstanding technical and management teams and provided them with first-class working conditions and facilities, to ensure the success of the cross-brand modular architecture strategy.”

Mats Fägerhag, CEO of the new R&D Centre, commented: “The modular design which allows several different vehicle platforms to be developed from one single architecture has been a proven approach in the industry. This will ensure tailor-made solutions to multiple brands for various market segments. This joint R&D Centre with combined strengths will enhance our competitiveness in technological leadership.”

Located in Lindholmen Science Park, Gothenburg, the Centre will take the advantage of industry-specific capabilities and abundant resources available in the region. Geely Group plans to invest approximately RMB400 million annually in the Centre to support its daily operations. The Centre has been staffed by existing engineers from Geely Auto and Volvo Cars as well as externally recruited talent to further strengthen the team. At present, approximately 70 engineers have started working in the Centre, we anticipate the number to reach its full scale of 200 by the second half of 2014.