The U.S. Department of Energy and the Swedish Energy Agency are providing a three year grant to the Volvo Group in a combined amount of $18 million for the development of hybrid technology and drivelines for alternative fuels.

This is an extension of the one-year research and cooperation agreement signed between the Volvo Group and the Swedish and U.S. governments in June 2007. The cooperation is aimed at reducing heavy vehicles' use of fossil fuels through research and development projects in the areas of energy efficiency, drivelines for alternative fuels and hybrid solutions.

"The climate issue and increasing fuel prices make energy use and energy efficiency some of the most important societal issues of our time. The transportation industry has a special responsibility and this research and development co-operation with the U.S.
Government is crucial in our efforts to develop the drivetrains and technology required by both our customers and society as a whole," says Leif Johansson, CEO of the Volvo Group.

The U.S. government and the Swedish Energy Agency intend to each invest a total of $9 million during the three years that the cooperation will be under way. The Volvo Group for its part has undertaken to invest an amount corresponding to $18 million, which means that the total investment in research and development within the framework of the cooperation agreement amounts to $36 million. As a result of the agreement signed last year, the Volvo Group is already involved in a number of projects.