Monday, December 1, 2008
Ford puts Volvo unit up for sale
Detroit News
Ford Motor Co. said this morning the economic decline and tight credit markets have forced it to consider the sale of its Volvo Cars unit.
Ford said the possible sale of Volvo is part of its "strategic review" to try and strengthen its balance sheet. Last year Ford sought buyers for Volvo, but later said the company wasn't for sale.
Today's announcement comes as Ford and its crosstown rivals, General Motors Corp. and Ford Motor Co. prepare plans to present to Congress outlining how they would spend $25 billion in emergency loans to help them weather one of the worst auto markets in decades. Congress is seeking specific actions from the companies, including brand sales, further work force reductions and other measures, before it will approve loans.
Volvo already has cut some 6,000 jobs worldwide, with more than half in Sweden.
"Given the unprecedented external challenges facing Ford and the entire industry, it is prudent for Ford to evaluate options for Volvo as we implement our One Ford plan," Ford President and CEO Alan Mulally said in a statement. "Volvo is a strong global brand with a proud heritage of safety and environmental responsibility and has launched an aggressive plan to right-size its operations and improve its financial results. As we conduct this review, we are committed to making the best decision for both Ford and Volvo going forward."
Also on Monday, the Swedish government confirmed it is in talks with GM and Ford after a report that the U.S. automakers are seeking support for their struggling Swedish brands Saab and Volvo Cars.
"We are obviously in talks with Saab, Volvo, GM and Ford all the time, considering the difficult situation," government spokeswoman Lisa Warn said.
Warn declined to give details on the talks, but said the European Union's tough competition regulations restrain the options for the Swedish government should it wish to support the Swedish-based car industry.
Ford, General Motors and Chrysler LLC have been lobbying the U.S. congress for financial assistance as the companies are being squeezed by falling sales amid the world economic crisis. However, the Swedes doubt U.S. lawmakers would be willing to support the companies' international operations.
"If GM gets money from the American government, then we're convinced that it will be earmarked for American interests," said Paul Akerlund, a union representative at Saab.
The companies plans are expected Tuesday and will be scrutinized at a Senate hearing Thursday and a House hearing on Friday
Ford puts Volvo unit up for sale
Detroit News
Ford Motor Co. said this morning the economic decline and tight credit markets have forced it to consider the sale of its Volvo Cars unit.
Ford said the possible sale of Volvo is part of its "strategic review" to try and strengthen its balance sheet. Last year Ford sought buyers for Volvo, but later said the company wasn't for sale.
Today's announcement comes as Ford and its crosstown rivals, General Motors Corp. and Ford Motor Co. prepare plans to present to Congress outlining how they would spend $25 billion in emergency loans to help them weather one of the worst auto markets in decades. Congress is seeking specific actions from the companies, including brand sales, further work force reductions and other measures, before it will approve loans.
Volvo already has cut some 6,000 jobs worldwide, with more than half in Sweden.
"Given the unprecedented external challenges facing Ford and the entire industry, it is prudent for Ford to evaluate options for Volvo as we implement our One Ford plan," Ford President and CEO Alan Mulally said in a statement. "Volvo is a strong global brand with a proud heritage of safety and environmental responsibility and has launched an aggressive plan to right-size its operations and improve its financial results. As we conduct this review, we are committed to making the best decision for both Ford and Volvo going forward."
Also on Monday, the Swedish government confirmed it is in talks with GM and Ford after a report that the U.S. automakers are seeking support for their struggling Swedish brands Saab and Volvo Cars.
"We are obviously in talks with Saab, Volvo, GM and Ford all the time, considering the difficult situation," government spokeswoman Lisa Warn said.
Warn declined to give details on the talks, but said the European Union's tough competition regulations restrain the options for the Swedish government should it wish to support the Swedish-based car industry.
Ford, General Motors and Chrysler LLC have been lobbying the U.S. congress for financial assistance as the companies are being squeezed by falling sales amid the world economic crisis. However, the Swedes doubt U.S. lawmakers would be willing to support the companies' international operations.
"If GM gets money from the American government, then we're convinced that it will be earmarked for American interests," said Paul Akerlund, a union representative at Saab.
The companies plans are expected Tuesday and will be scrutinized at a Senate hearing Thursday and a House hearing on Friday
