Volvo acquires full ownership of Luqiao plant

Beijing (Gasgoo)- Geely Holding has reached an agreement with Volvo Car Group for the subsidiary to fully take over the Luqiao manufacturing plant as its company assets.

The Luqiao plant; photo credit: Volvo Cars

This means, in the next two years, Volvo Cars holds ownership of all plants producing its cars. The 2,600 staff members, along with the manufacturing and support departments will all shift from Geely Holding to Volvo Cars, thus creating a clearer ownership structure between the two entities.

Since establishment in 2017, the Luqiao factory was owned by Geely Holding with Volvo Cars providing operational support. The plant will continue producing the Volvo XC40, the fully electric XC40 Recharge and Polestar 2 models.

Notably, the Luqiao plant will likely be referred to as the Taizhou plant in the future, representing the name of its city, given Volvo Cars naming convention.

The transfer is a logical decision benefiting both parties, as it provides Volvo Cars with the corresponding scale needed to further layout in China. The plant currently produces models based on the co-developed Compact Modular Architecture (CMA) by the two companies.

The two parties sustained a mutual goal for optimal collaboration advantages for both. Early on, Geely Holding and Volvo Cars jointly spun off their powertrain operations for a stand-alone business, Aurobay. In July, Volvo Cars also signed an agreement to acquire Geely Holding’s stake in the companies’ joint ventures in China.