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Volvo and Geely to Merge Combustion Engine Unit, Freeing Up Volvo to Work on Electrification

Volvo’s internal combustion design unit is being spun off and combined with Geely’s unit to a form one, new standalone business. This, say the companies, will allow Volvo to focus on the electrification of its range.

After teasing the electric XC40, this marks another proclamation of Volvo’s dedication to all-electric powertrains. The Swedes figure that a full half of their sales will be electric, with the other half coming from hybrid cars. 

With Geely, Proton, Lotus, LEVC, and Lynk & Co still requiring combustion engines, and Volvo still requiring combustion engines for their hybrids, Geely couldn’t exactly just shutter the engine plant.

So the 3,000 people associated with Volvo’s combustion engine department, and the 5,000 associated with Geely’s will moving in together. The company doesn’t plan to lay anyone off as a result of this move.

“Hybrid cars need the best internal combustion engines. This new unit will have the resources, scale and expertise to develop these powertrains cost efficiently,” said Håkan Samuelsson, Volvo Cars’ president and chief executive.

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