Ford to keep Volvo
November 9, 2007 by Alborz Fallah
Volvo employees must be feeling a little confused because Ford’s plans to sell its Swedish manufacturer have taken yet another turn: the blue oval now intends to keep Volvo.
Ford released its third-quarter earnings report today, noting a strategic plan for Volvo’s road to financial recovery. Although there was no reference of a long term outlook for Volvo within the Ford ranks Ford chief executive Alan Mulally said Ford no longer urgently wanted to rid itself of the Swedish marque .
“Our plan now is not to sell Volvo but to improve its cost structure and brand positioning. I think we can do substantially better than where we are today, “ Mr Mulally said.
It appears that while Ford is not ruling out a sale at the right price, it wants Volvo to operate more independently, giving Ford room to recover from its financial woes. The plan involves:
- Enhancing Volvo’s position as a global maker of premium vehicles
- Establishing appropriate business arrangements between Volvo and Ford-brand operations to let Volvo operate more independently
- Getting more efficiencies between Ford-brand operations and Volvo in areas such as product development and purchasing
- Disclosing Volvo’s financial performance beginning with 2008 results.
Volvo hasn’t exactly made it self a great acquisition either, the company posted an estimated $100 million loss in the third quarter of 2007.
Ford set up its Premier Automotive Group (PAG) with Volvo, Jaguar and Land Rover in 1999 to expand its market share, a plan which did not eventuate. Ford is still planning to sell Land Rover and Jaguar.
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****PRIMO!****
Said it before and say it again, no market for Volvo & Saab when they are priced like a Bmw/Benz/Audi/Lexus.
A dead brand, but in all fairness Fart have not ruined it as bad as GM has with Saab.
PS GM just reported a US$39 Billion Loss, good going guys!
Cheers
F-0
I cant imagine ford wanting to sell volvo.. dont want to lose the brilliant engine powering the focus xr5.
I agree with Frugal One’s comment though, Volvo and even more-so Saab are always going to struggle at German Prices. Ive driven the new saabs and they are a damn nice driving car, one of the linear arc or vector 9-3 has the most comfortable (not for spirited driving just highway driving) seats ive ever sat in.
Volvo are now making very impressive cars as well, again just too expensive.
What’s this ‘****PRIMO!****’ is that like ‘touchdown’ or something?
Ford are getting something out of Volvo. Hence, Volvo isn’t sold.
^^ive thought that for a while, kindve a stupid way to start each comment
Well – I am looking forward to seeing the new XC70. It isn’t priced like a BMW.
Diesel will be $60k, somewhat less than a X5 etc.
Some of the low end models are overpriced though…
Ford is smart keeping Volvo, I’m sure they sell heaps more Volvos than GM trying to sell a SAAB or two, I never see any ads for this brand of car anyway.
Ford has to keep some reputation and not go down GM-Daewoo lost venture, in the end quality is what people want…
Ford is smart keeping Volvo?
Ford has financial woes just like GM, so the loss of $100 Million from Volvo fits well in the Ford psyche – wouldn’t do to have a profit maker in there, hey?
not really reckless1, GM last quarter lost $39 billion dollars, ford lost $380 million in a quarter. Its still not great, but when analyists were expecting $1b loss from ford, and $380 million is 100 times less than GM, I’d say ford can handle the occasional brand to slip up. GM is the one running out of options, and at least Volvo is worth keeping (they do fairly well in europe), and has the potential to be fixed, unlike saab, who’s on life support and waiting for someone to pull the plug.
Iamthestig Says:
November 9th, 2007 at 2:56 pm
Well – I am looking forward to seeing the new XC70. It isn’t priced like a BMW.
Diesel will be $60k, somewhat less than a X5 etc.
Yeah……Same price as a almost same size X3
Me and the market have spoken, we know which we prefer:-)
Cheers
F-0
People are funny…
Volvo made it’s first loss of 100 million this last quarter, otherwise Ford has seen nothing but profits from Volvo, it’s actually the one that help PAG up while the rest were losing money.
Sell Jag/LR and keep Volvo, they intergrate better than the other two.
One quarter of losses does not = a bad purchase.
\”Yeah……Same price as a almost same size X3
Me and the market have spoken, we know which we prefer:-)
Cheers
F-0\”
Right…
XC70 – 4838mm long
X3 – 4569mm long
X5 – 4854mm long
Check your facts first eh ?
The upcoming XC60 is the X3 competitor.
The X5 sells well, the X3 doesn’t…
Iamthestig Says:
November 10th, 2007 at 11:39 pm
\”Yeah……Same price as a almost same size X3
Me and the market have spoken, we know which we prefer:-)
Cheers
F-0\”
Right…
XC70 – 4838mm long
X3 – 4569mm long
X5 – 4854mm long
Check your facts first eh ?
The upcoming XC60 is the X3 competitor.
The X5 sells well, the X3 doesn’t…
Length of vehicle means zip, its wheelbase thats the true measure of a vehicles room and market segment.
X3 2795mm
X5 2819mm
XC70 2763mm
Yeap i checked my facts, and as per usual 100% correct
Volvo is a dog brand, but not as bad as Saab [Yet!]
Ford cannot *dump* it, NOBODY is interested in buying it!
Cheers
F-0
“Length of vehicle means zip, its wheelbase thats the true measure of a vehicles room and market segment.
X3 2795mm
X5 2819mm
XC70 2763mm
Yeap i checked my facts, and as per usual 100% correct
Volvo is a dog brand, but not as bad as Saab [Yet!]”
Dear, dear, you are a dumbo…
Trying to cover up your mistakes with Polliespeak !
Wheelbase is “size” not length – oh well…
For your records – The new XC70 actually has a wheelbase of 2815mm
Are you happy now ? – Mr 100% WRONG !
LOL !!!
Looks like that are over it now
Hard to say if not selling Volvo
is good or bad for Ford…
Cheers
Me.
LOL