Aurobay becomes part of new global company for next-generation powertrains

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Zhejiang Aurobay Powertrain Co., Ltd (Aurobay), formerly owned by Volvo Cars, will become part of a new global company owned by Renault and Geely that develops and manufactures hybrid and low-emission powertrains.Published: November 8, 2022, 05:45

Aurobay’s owner Geely Holding1 together with Geely Auto2 has signed3 an agreement with the Renault Group to merge their operations in the production of combustion and hybrid powertrains. The new company, expected to be operational in 2023, will have 17 factories and five research and development centers in Asia, the Americas and Europe, and employ 19,000 people. Aurobay, which has 2,850 employees in Gothenburg, Skövde and Zhangjiakou in China, will be part of the new company. Since the separation from Volvo Cars in July 2021, Aurobay has become a pioneer in the development of combustion engines with low or no carbon dioxide emissions. The demand for powertrains based on hybrid and low-emission combustion technologies is expected to remain a part of the automotive industry for decades to come. The new company presented today will annually produce around 5 million internal combustion, hybrid and plug-in hybrid engines and gearboxes. The new company will provide several vehicle manufacturers worldwide with a complete set of market-leading powertrains, including electric solutions. From the outset, the new company is expected to supply several customers, including Volvo Cars, Renault, Dacia, Geely Auto, Lynk & Co and PROTON. Volvo Cars has decided to transfer its ownership in Aurobay to Geely Holding. According to the non-binding agreement, Geely Holding and Renault Group will each hold 50 percent of the shares in the new company. The new company, which combines a geographically strategic presence with an attractive business model, will offer its suppliers great synergy opportunities and at the same time constitute an attractive investment opportunity for industrial and financial partners.

8 November 2022, Gothenburg – Geely Holding Group (Geely Holding), Geely Automobile Holdings Limited (Geely Auto HK.0175) (collectively Geely) and Renault Group have signed a non-binding framework agreement to create a new global company to develop, manufacture and deliver market-leading powertrains and highly efficient combustion engines (ICE, Internal Combustion Engines). Once the deal is completed, the new company will be an independent global provider with a full range of solutions based on ICE technology. It will produce next-generation hybrid powertrains and develop low-emission technologies. According to the plans, the new company will operate 17 factories in the Americas, Asia and Europe and have a total of about 19,000 employees, producing about 5 million internal combustion, hybrid and plug-in hybrid engines and transmissions per year. Right from the start, the new company is expected to deliver to customers in the automotive industry such as Volvo Cars, Renault, Dacia, Geely Auto, Lynk & Co and PROTON. In the future, the company may offer driveline technologies to other car brands as well. The new company will welcome new industrial and financial partners who see opportunities in contributing to industry-leading solutions that provide low or no emissions over the product life cycle, as well as the opportunity to create value in the ongoing transformation of the automotive industry. Aurobay has been a leader in the development of internal combustion engines with low or no emissions since the company was established in July 2021. Aurobay has a clear focus on sustainability and a circular view of emissions. Aurobay, with its 2,850 employees in Sweden and China, will contribute its unique R&D and manufacturing capabilities to the new company. Electrification is only one of several solutions required to reach net zero emissions from vehicles globally. In many parts of the world, there will be neither enough fossil-free electricity nor enough charging infrastructure to enable rapid electrification. According to industry estimates, 55-75 percent of all cars on the road in 2040 will still be powered by hybrid and internal combustion engines,” says Michael Fleiss, vice president of Aurobay. “Many car manufacturers are concentrating on electric powertrains and will lose focus on combustion and hybrid systems. The new company will develop and deliver state-of-the-art products. We will have the size, knowledge and capability to develop and manufacture low- or zero-emission hybrid engines on a scale that will significantly reduce the global carbon footprint,” says Michael Fleiss. In addition, Volvo Cars4 has decided to transfer its ownership in Aurobay Sweden to Geely Holding. Volvo Cars and Aurobay will continue to cooperate, and Aurobay will remain Volvo Cars’ sole supplier of powertrains. “Volvo Cars and Aurobay’s strategic partnership continues. Volvo Cars and Aurobay have a common history that spans over 100 years. It is a stable foundation to build future collaborations on,” says Michael Fleiss.1 Zhejiang Geely Holding Group Co., Ltd.
2 Geely Automobile Holdings Limited (Geely Auto HK.0175)
3 http://zgh.com/media-center/news/2022-11-08/?lang=en
4 via its wholly owned Volvo Car (China) Investment Co Ltd. (VCI) Helene Carlson
Head of Communications and Public Affairs
+46 765 25 84 93
[email protected] The following attachments are available for download:
Aurobay Press Release SWE 221108 See full press release and other news from this company at Cision News.
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