After news that the EU have okay-ed the sale of Volvo to automakers Geely, comes word that the Chinese company will be setting up a research and development centre for Volvo at the Shanghai International Automobile City. Looks like the ‘technology transfer’ plans have started immediately! Rumours of Geely scouting for a possible site in China for a Volvo assembly plant still persists, and such a plant will likely be near the R&D centre.

The R&D centre will be called Geely-Volvo Research and Development Center and will be situated in an industrial park in the Jiading district of western Shanghai, which plays host to other big names like Shanghai Volkswagen Automotive Co., Shanghai Automotive Industry Corp. and also automotive suppliers such as Fiat Powertrain Technologies. The Shanghai International Circuit is also located in Jiading.

Geely’s president Li Shufu said that Volvo’s biggest handicap is its economies of scale and will only start making a profit if sales hit 370,000 units a year. This number currently stands at 335,000 vehicles globally, of which 22,664 are Chinese market contributed numbers.