Ford – Volvo Could Be Sold

Things get worse in Dearborn

By Brendan Moore

07.15.2007

According to sources within Ford, the company has reversed its corporate stance on Volvo and is now open to selling the Swedish car company in the near future.

Ford has been insisting for months that Volvo was not for sale, despite rumors to the contrary, and a recent news report that BMW had considered buying the company from Ford. Spokespeople at Ford had no comment today on today’s revelations, which have been reported by most major news outlets. The story is considered credible enough so that The Wall Street Journal is running it on their weekend online edition front page today.

We predicted in December 2006 (Is Ford Going to Make It?) that Aston Martin, Jaguar and Land Rover would probably be sold in 2007, and opined that Volvo stood an excellent chance of being sold in 2007 as well. Ford is in very bad shape financially, and the recent turnaround efforts are not going as well as Ford had predicted (although its pretty much tracking what we predicted), so it is not that surprising that Ford needs operating cash badly enough to sell Volvo. According to the industry analysts that price these sorts of things out, Ford could reasonably expect to realize around $8 billion USD from the sale of Volvo. Ford is literally in a fight for its very existence and the company is going to need every bit of cash they can lay their hands on in the next couple of years, so that $8 billion would be welcome indeed.

Unlike Jaguar and Land Rover, who so far have not attracted a lot of interest as a package deal from prospective buyers so far this year, Volvo by itself is expected to elicit desire among several possible purchasers. Ford should have no shortage of potential bidders for the Swedish company.

As fans of good automobiles, we hope that Volvo gets a good steward if/when they get sold, and let’s hope that Ford can put the money from this desperate sale to the best possible use. Stay with us for more updates as they unfold.

COPYRIGHT Autosavant.net – All Rights Reserved

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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4 Comments

  1. Ford has already put out a press release denying Volvo is for sale. You should stop spreading rumors like this. Ford will never sell Volvo, it’s the only part of the company worth anything.

  2. I think it is past the rumor stage at this point.

  3. Never say never…..

  4. I decided to quote myself from a post then I posted at Autoblog, sorry for the inconvience, I couldn’t resist.

    The Peich family wants to made VW as the “GM of Europe”, I could said then the Quandt family, the main stockholders of BMW wants to made BMW as the “GM of Bavaria”, a interesting pipe-dream but…. maybe I’m pessimistic here. I won’t be surprised to imagine then Carlos “Car tzar” Ghosn could be back with another offer to Ford to acquiring Volvo, there was a old rumor spotted at this French blog
    http://www.leblogauto.com/2007/06/volvo-nouvelle-demande-en-mariage-de-renault.html

    and an older topic at this French blog, some suspected then BMW might buy Volvo to eleminate an opponent in a more long-term
    http://www.leblogauto.com/2007/05/bmw-serait-interesse-par-le-rachat-de-volvo-automobile.html

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