Swedish auto giant, Volvo may soon feature engines from Daimler apparently. Manager Magazin, the German media outlet claims the company is considering working with Geely, Volvo’s parent company towards a partnership that could range from buying a small part of Volvo to supplying them with engines.
Li Shufu, the owner of Geely currently owns a 9.7 percent share in Daimler so it would make sense for the companies to intensify their already present collaboration. He is also one most likely to make such a decision for the purposes of what he would term as preserving the auto industry.
Mixed Feelings from Owner of Volvo
Li Shufu is of the view, that further co-operation is vital towards fending off newcomers like Uber and Alphabet in the industry, which he has referred to as ‘invaders’. He particularly stated cooperation in the areas of self-driving and electric cars when he acquired stake in Daimler, though there is no doubt both of the parties are going to be open to other areas of cooperation.
It would seem that not everyone shares the motivation directed at the self-driving race. It is understandable how this may be considered a threat from some parties. It will completely change the way cars are operated in terms of fuel and driving which uproots certain brand placements and exposes several parties financially. To some like Li Shufu, it is a matter of principle. The invasion of silicon valley into the auto industry to make self-driving and EV a reality is contaminating the concept on which the auto industry was built. Unfortunately, progress has never been subdued for long so this is a compromise that even he will have to adapt Volvo towards. The company is already supplying models for self-driving Uber options after all. There also reports of both companies developing a joint EV platform along with production of battery cells. Volvo was after all developing a new EV platform for some-time and the first iteration from this platform was expected to be unveiled during the coming year.
Cold Shoulder from Some Mercedes Execs
This is not the first time Daimler has made a deal with an auto manufacturer. They did so with Aston Martin in 2013 for a 5 percent stake in return for supplying them with engines and electronic systems. This type of agreement though is not popular in house.
Apparently Daimler executives are not enjoying the prospect of what they term as handing over technologies to Volvo. Daimler though is also expected to buy a small share in Volvo though none of the companies has given an official confirmation on this as yet. Volvo has since been skeptical on this part of the report, stating it was speculation.
Apart from the EVs, Mercedes would be expected to share other components with the Swedish manufacturer. In the future thus, AMG performance engines could be utilized for Polestar performance brand units. Volvo may also get a lot of flexibility as they offer a lot of more engine options for the clients depending on the particular markets in question. The smooth 9 speed dual clutch automatic transmission may also make its way into Volvo models but this is still speculation at the moment.