For Sale: One Slightly Abused Swedish Car Brand
The Wall Street Journal [sub] reports Volvo's saying farväl to a third of the production workers at their last remaining Swedish factory. (The Belgian factory which makes Volvo's smaller vehicles is so far exempt from the cutbacks.) And no wonder. "Despite expansion in Russia and China, Volvo reported selling 22,000 fewer vehicles during the first quarter of this year compared with the same period a year ago." And there there's a sales mix shift to smaller, cheaper, less profitable vehicles and the weak U.S. dollar. It all adds up to a loss of "$151 million in the first quarter of this year, compared with a $94 million profit during the same quarter in 2007." Both are mouse nuts numbers in the Ford scheme of things, but Investor Kirk "The Lion of Las Vegas" Kerkorian's minion Jerome York recently opined that FoMoCo will probably jettison Volvo within 18 months. Ford says Volvo isn't for sale, forgetting to add "we constantly review the situation." Translation: yet.
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Is SAAB going to be next?
"Is SAAB going to be next?" GM is not showing the same sense of urgency to rationalize the brand portfolio that we are seeing from Ford. So no, I don't think so. Besides, who would WANT Saab? While Volvo might end up at a Scratch-and-Dent sale, Saab is one step away from the recycling plant.
While I hate Ford, I do admire Volvo and hope they do not get purchased by the Chinese or Indians. Hopefully, BMW or Toyota will purchase them. TTAC should begin the Save Volvo campaign.
I don't get why Ford would sell Volvo? They need an upscale marque and Lincoln isn't likely to be it anywhere outside of North America. Does Volvo really take up too much management time or are they really so hard up for cash? Ford should be turning Volvo into a BMW competitor. I don't see any logic for BMW to buy Volvo either. They already made the mistake of buying Rover in pursuit of volume. What on earth would they gain from buying Volvo except high costs and low margins? The only existing marque I would like to see BMW buy is Lotus.