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New Volvo sale rumors surface

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Surprised nobody caught this. Apparently, there were some fresh rumors this past weekend of Ford looking to sell off the last of the now defunct Premier Automotive Group created by former Ford Motor Co. President & CEO Jack Nasser. Ford was quick to deny.

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Ford denies it's in talks to sell Volvo

Jul. 15, 2007 (AFX International Focus) -- DETROIT (AP) - Ford Motor Co. (NYSE:F PRS) (NYSE:F PRA) (NYSE:F) , responding to reports that it's putting its Volvo unit up for sale, said it is not negotiating with anyone to sell the Swedish automaker.

The Sunday Times, citing unnamed sources in London, said the decision to sell Volvo, which is part of Ford's Premier Automotive Group, was made in the past two weeks, but that the timing of the sale had yet to be decided.

The New York Times, in a story posted Sunday on its Web site, said Ford would entertain offers for Volvo following a board meeting last week. The newspaper cited people whom it didn't name who it said had knowledge of the situation.

Ford spokesman Tom Hoyt said in an interview with The Associated Press on Sunday that the company wasn't commenting on speculation about Volvo's future. But later in the day, he issued a denial that the automaker was in talks to sell the unit.

'To my knowledge, we are not in negotiations with anyone about the future of Volvo,' Hoyt said.

When Ford last August announced it was exploring the possible sale of its Aston Martin luxury sports car brand, the automaker left open the possibility that other Premier Automotive Group brands, including Volvo, could be sold.

Auto analyst David Cole said if Ford's cash flow problems were desperate enough, selling Volvo might make some sense.

'You could get cash out of it, which is very important right now,' said Cole, chairman of the Center for Automotive Research in Ann Arbor.

Ford in December finalized a $23.4 billion financing package to fuel its restructuring and cover expected losses in its automotive operations. It pledged domestic plants and other automotive assets as collateral.

No bank had been appointed to handle the Volvo transaction, both newspapers said. The Sunday Times said the deal could be worth $8 billion.

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Edited by Cadillacfan

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I don't think any of these sales (Volvo, Jag, LR) are going to happen if Ford shows some serious progress in the Q2 financial results. Much of Ford's loss last year was one-time costs like GM had, and with new product flying off the lots and money-makers like the F-series and Expedition still going pretty strong, I'm thinking Q2 will be much sunnier than past quarterlies.

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I worry about how selling Volvo will affect Ford since there is quite a bit of platform/components sharing between the two of them. Ford seems to be tied more closely to Volvo than it was to Jaguar, Land Rover, or Aston Martin. I know that Ford is desperate to raise capital to assist with its turnaround, but is dumping Volvo such a wise move?

Edited by cire

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Maybe the Chinese can take this brand, and again improve the breed over there.

Perhaps Brilliance would be a nice suitor....Brilliance for volume, Volvo as the premium?

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