Swedish daily newspaper Dagens Industri reports that Ford may be seriously interested in selling its Volvo Cars unit – a part of Ford’s Premier Automotive Group (PAG) division. The report cites sources in Volvo and rumours in Ford’s Dearborn headquarters.
Selling the Volvo Cars unit would certainly bolster Ford’s depleted financial reserves. Analysts note that any planned sale would have to happen ‘sooner rather than later’ while Volvo’s models and platforms are still highly independent from Ford’s. Volvo’s large cars are still based on a unique Volvo platform, but the smaller S40/V40 range made at NedCar is planned for replacement in 2003 on a platform closely related to Ford’s CW214 (Focus) platform.
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The ‘Volvo for sale’ rumours have been given added impetus by the recent departure of Wolfgang Reitzle as head of PAG, as well as other management changes within PAG. This week it was announced that the PAG has axed two general manager roles and reorganised the rest of the North American Aston Martin Jaguar Land Rover (AMJLR) management line-up.
It has also been rumoured lately that Ford may be interested in selling its Aston Martin unit.
However, Nick Scheele, Ford president and chief operating officer, yesterday dismissed the speculation and rumours about selling Volvo Cars as ‘absolute rubbish’.
Analysts note that Ford is looking for a strong contribution to profits from its PAG brands in the future. Ford hopes that the division as a whole will be able to generate a third of Ford’s global profits by the middle of the decade. Ford representatives insist that Volvo Cars will play an important part in achieving that.
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