Volvo Cars, a distinguished name in the automotive industry, has recently made headlines with its strategic move to acquire full ownership of its operations in China. This decision raises a pertinent question for many car enthusiasts and industry observers alike: who exactly owns Volvo Cars? Understanding the ownership structure is crucial to grasping Volvo’s current trajectory and future ambitions, especially within the global automotive landscape.
To clarify, Volvo Cars has been under the ownership of Zhejiang Geely Holding Group (Geely Holding), a Chinese multinational automotive company, since 2010. This acquisition marked a significant turning point for the Swedish car manufacturer, providing it with the resources and support to revitalize and expand its global presence. Prior to Geely, Volvo Cars was part of Ford Motor Company. The shift to Geely ownership brought about a renewed focus on innovation, safety, and Scandinavian design, core tenets that define the Volvo brand.
The recent agreement between Volvo Cars and Geely Holding further solidifies this partnership, albeit in a nuanced way. Volvo Cars is set to acquire Geely Holding’s stake in their joint ventures in China. This strategic maneuver is not about changing the overarching ownership of Volvo Cars itself; Geely Holding remains the parent company. Instead, it’s about streamlining operational control within China, Volvo’s largest and one of the fastest-growing markets globally.
This acquisition of the remaining 50 percent of shares in Daqing Volvo Car Manufacturing Co., Ltd and Shanghai Volvo Car Research and Development Co., Ltd empowers Volvo Cars with complete control over its manufacturing plants in Chengdu and Daqing, its national sales company in China, and its R&D facility in Shanghai. While these joint venture companies were already consolidated within Volvo Car Group’s financial statements, this full ownership simplifies the operational structure and allows for more direct management and strategic implementation in this crucial market.
Håkan Samuelsson, chief executive of Volvo Cars, highlighted the significance of this agreement, stating that Volvo Cars would become the first major non-Chinese automaker with full control over its Chinese operations. Daniel Donghui Li, chief executive officer of Geely Holding, also emphasized that these transactions aim to create a clearer ownership structure within both Volvo Cars and Geely Holding, optimizing collaboration within the broader group.
Volvo Cars’ performance in China speaks volumes about the strategic importance of this market. In 2020, the company sold over 166,000 cars in China, marking an impressive 7.5 percent increase from the previous year and the eighth consecutive sales record. This growth trajectory continued into 2021, with sales surging by 44.9 percent in the first half compared to 2020. This robust growth underscores Volvo’s commitment to investing in China and maintaining its strong momentum.
In conclusion, to answer the core question, Zhejiang Geely Holding Group owns Volvo Cars. The recent agreement to acquire full ownership of the Chinese joint ventures is a strategic step to enhance Volvo Cars’ operational efficiency and market penetration within China, under the continued umbrella of Geely’s ownership. This move signals a deeper integration and commitment to the Chinese market, reinforcing Volvo Cars’ global strategy for growth and innovation in the years to come. As Volvo Cars continues to navigate the evolving automotive industry, its partnership with Geely remains a cornerstone of its global success.
