VOLVO Cars is planning to set up a new joint venture technology company with owner Geely Holding to advance EV development.

They will share existing and future technology, deepen industrial synergies and provide the economies of scale that will allow them to develop the next generation electrified vehicle technology.

Volvo Cars, Geely Auto and LYNK & CO will share vehicle architecture and engine technologies via cross licensing arrangements of technologies managed by the new joint venture.

They will also cooperate more deeply by sourcing components and cutting procurement costs.

Volvo Cars, Geely Auto and LYNK & CO are controlled by Geely Holding, the new joint venture will be 50/50 owned by Volvo Cars and Geely Holding and be headquartered in China with a subsidiary in Gothenburg, Sweden.

Volvo president and chief executive Hakan Samuelsson said: “Partnerships to share know-how and technologies are common practice in the automotive industry. This is the model we are adopting.

“This planned collaboration will strengthen Volvo’s ability to develop next generation electrified cars.”

Volvo Cars and Geely already share technology, most notably the Compact Modular Architecture which is being used by Volvo Cars for its soon-to-be-announced smaller range of 40 series cars and by LYNK & CO.

It is expected that the collaboration will extend in future to also cover electrified vehicle components such as battery cells, e-motors and charging systems in order to maximise synergies across the group.