Geely and Volvo have jointly announced that they will cancel their merger plan while continuing to work closely together. 

Geely acquired Volvo in March 2010, but in order to maximize the benefits, the two parties have maintained their independence. Since then, Geely has grown to one of the most valuable companies in the world.

Recently, Volvo released a financial report stating it sold 661,713 cars in 2020, with a year-on-year decrease of 6%.

Hanken Samuelson, CEO of Volvo Cars said: “Having evaluated different options to realise value, we concluded jointly that a collaboration model between two standalone companies is the best way to secure continued growth and at the same time achieve technological synergies in many areas.”

The merger plan was originally proposed by Li Shufu, chairman of Geely Holding Group. If the merger had been successful, Geely would have become the most valuable company in China's auto industry and would have been created an international alliance.

Geely also owns 9.7% of the Daimler group, and controls Proton, Lotus, Lynk & Co and Polestar.

Li Shufu admitted: “As a shareholder of these two listed companies, Geely Holding Group has gained tremendous benefits while cooperating independently.”

It’s believed that Geely will deepen cooperation with Volvo on the basis of maintaining their existing company structures. Areas of cooperation include the development in autonomous driving and building EVs.