Ford Still Deciding on the Fate of Volvo

The last time that Bill Ford has made an optimisticrepay all of Ford's debts and also to renegotiate
announcement was in 2005 wherein he cited Ford andborrowing terms since right now the automaker is
Volvo engineers working together to produce newfinding it hard to find financial institutions that would loan
exciting safety features that will enhanced night visionthem additional capital.
and improved collision avoidance ability of vehicles.Rod Lache an analyst at Deutsche Bank has told
Unfortunately after such announcement Ford'sclients last Tuesday that Ford has two very good
finances have started to dwindle and hasreasons to get rid of Volvo. The first one is that the
overshadowed the earlier full of hope message of Mr.Volvo sale would simplify the recovery strategy and
Ford. Instead of the closer cooperation between Fordoperating structure of Ford. Second, it would provide a
and Volvo that Mr. Ford has announced, thesource of extra cash for the restructuring of
automaker with its new CEO Alan Mulally is mullinghealthcare liabilities as part of the upcoming talks with
over the sale of its Sweden-based subsidiary. Bill Fordthe United Auto Workers' union.
remains to be the Chairman of Ford Motors and unlikeHowever the sale of Volvo the producer of Volvo
in the past wherein he always gives out public updates240 parts would signal the final dismemberment of
on the happenings within the company now he choseFord's premier car business outside of North America
to keep quite and to give as few comments aswhich was formed in the year 1980s and 1990s.
possible on the family business.Ford has disposed of Aston Martin earlier this year
The issue on the sale of Volvo has divided Volvo andand last Thursday was the deadline set by the
Ford. But Ford has stressed that it has not engaged inautomaker's financial advisers for interested buyers to
any talks with any prospective buyers. Ford with all ofgive their bid for Land Rover and Jaguar. But for
its assets already pledged to creditors need to raise aVolvo, Ford has not yet made any official
huge amount to continue the production of newannouncement of it's supposedly sale. This must be
products and to realize their turnaround plan. The salebecause of the fact that the Swedish automaker has
of Volvo is one of the plausible options that thebeen the most profitable part of the PAG plus it has
automaker has since its one of their profitable brand.made a significant contribution to the development of
The proceeds from the Volvo sale will be used toother Ford products.