Why Did Geely Fail to Acquire Technology from Volvo After the Acquisition?
2 Answers
Geely's inability to acquire technology from Volvo after the acquisition can be attributed to the following reasons: 1. Legal Aspects: One factor involves legal constraints. Although Volvo has been acquired by Geely, as of now, Volvo Cars and Geely Auto remain two independent automotive brands. Directly utilizing the other party's core technology without Volvo's permission would constitute infringement. 2. CMA Platform: Geely and Volvo have devised an optimal solution—the CMA platform, jointly developed by both brands. The greatest advantage of this platform lies in the fact that the technologies developed under it do not entail the high maintenance and repair costs associated with Volvo's technologies, while also offering certain improvements over Geely's previous technologies. Therefore, this compromise solution has proven satisfactory for Geely.
After Geely acquired Volvo, it couldn't obtain all the technologies, mainly due to the protective clauses in the agreement. As someone who has long followed the automotive industry, I've reviewed a lot of materials. At the time of the sale from Ford to Geely, there were strict restrictions in place. Volvo's core intellectual properties, such as safety systems and environmental technologies, couldn't be directly transferred to Geely, as doing so would violate international intellectual property laws. Although Geely became the owner, the core technologies remained under the control of the Volvo team. Sharing these technologies required complex approval processes, compounded by significant cultural differences and poor communication between engineers from both sides, leading to slow technology transfer. This is actually common in cross-border mergers and acquisitions, where the primary goal is to protect brand value rather than achieve rapid replication. I believe Geely is gradually learning through joint R&D, but it will still take many years to fully absorb the technologies. Currently, they are more focused on enhancing the brand's global influence.
