Volvo Car Corporation: Volvo Cars and Ford Motor Company Commit to Environmental Technology Development In Sweden

In a twin announcement today, Ford Motor Company and Volvo Carsunveiled environmental engineering plans in Gothenburg, Sweden.

First, led by Volvo Cars, Ford Motor Company will establish ahybrid development center in Gothenburg for Ford's Premier AutomotiveGroup and Ford of Europe business units.

This center will have overall responsibility for the applicationof hybrid systems into Volvo Cars vehicles globally as well as forensuring Ford of Europe and brands from Ford's Premier AutomotiveGroup are able to apply core hybrid systems into their own productplans.

The center will be staffed initially by a mix of 20 leadingengineers from both Volvo Cars and other brands from the Ford MotorCompany group.

Part of a global initiative by Ford Motor Company to speed theintroduction of more fuel-efficient vehicles, the new hybriddevelopment center will build on the experience and expertise thatVolvo Cars has built up over many years in developing advancedenvironmental technology systems, including some of the early hybridsystems, that eventually made their way into the world's first hybridSUV, the Ford Escape.

"We are very pleased that Ford Motor Company has decided toestablish a development-center for hybrid technology in Gothenburg.This shows a strong belief in Volvo Cars and our ability to deliverresults in future advanced technologies and underline the fact thatSweden has all the pre-requisites for research and developmentexcellence" says Fredrik Arp, President and CEO of Volvo CarCorporation.

The center's location will ensure that hybrid technologydevelopment at Ford Motor Company takes into account different markettrends and customer preferences in regions around the world. While thenew center will be located in Gothenburg, each brand within FordEuropean operations will be responsible for applying new technologiesto their own product portfolios.

The team at the new hybrid center will also work closely withFord's hybrid development team in Detroit, Michigan, to ensure optimumglobal alignment and economies of scale.

"The hybrid cars of tomorrow will be more sophisticated and muchfurther developed compared with what we see on the road today. And itis likely that we will find high-performance hybrids running ondiesels and renewable fuels," says Arp.

Volvo Car Corporation invests 10 billion SEK in environmentaltechnologies

In a linked announcement, Volvo Cars announced the investment of10 billion SEK in environmental research and development. The aim isto reduce the total fuel economy and tailpipe emissions of the globalVolvo Cars fleet.

The investment initiative will focus primarily on the developmentand deployment of cleaner, more efficient diesel engines, hybrids andalternative fuel vehicles, the use of light, strong materials likemagnesium, aluminium and lighter high-strength steel, and theintroduction of smaller vehicles, while continuing to meet customerexpectations for safety in Volvo Cars.

"Volvo Cars commitment to the environment is long-standing andwell-recognised - it is part of what people know us for. With thissignificant investment we are ensuring that our tradition continues inthe years to come and that Volvo customers' green aspirations will bemet," added Fredrik Arp.

The Volvo Car Corporation, with its head office in Gothenburg,Sweden, has been a subsidiary of Ford Motor Company since 1999. Volvohas approximately 27,000 employees around the world.

For further information, visit www.media.volvocars.com or contact

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