$2 Billion For Volvo? Ford Motor Co. may get $1 billion to $2 billion for its Volvo Cars unit, less than a third of what it paid 10 years ago. Yeowch. [Bloomberg]

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  1. Oranges w/ Cheese says:

    So, how is it that Volvo has always had this shining reputation for safe cars that are (fairly) affordable, and yet Ford is struggling?

    Same reason Saturn is the shining star of GM? I don’t get it.

    • dohtem says:

      @Oranges w/ Cheese: That’s what happens when you spread yourself too thin.
      [en.wikipedia.org]

      Now they can’t sell their interests in other car companies fast enough.

    • Honus says:

      @Oranges w/ Cheese:

      Ford’s got the safety part down now:
      [www.seattlepi.com]

      And the reliability is there too, from different sources. So while Volvo may not sell off very high, if it yielded results like that, it might have been worth the billions it took to buy it.

    • Paladin_11 says:

      @Oranges w/ Cheese: The rest of the market has largely caught up with Volvo in terms of safety. The problem Ford has with them is that there’s no great differentiation between Volvo and some of their other brands. Still, to say Ford is taking a loss here is kind of a stretch. They gained a lot by sharing Volvo’s platforms for other cars, and they’d arguably be in much worse shape if they didn’t have those assets available. The real reason they won’t get the $6 billion back they originally paid is that the market for all cars is depressed. That doesn’t leave a lot of buyers for the company.

      Volvo will soon be in Chinese hands and Ford will get some much needed cash. This isn’t a bad thing for either side, but it probably will be for Volvo’s workers.

      • squablow says:

        @Paladin_11: I agree, Ford gained a lot when they bought Volvo, and I think they got their money’s worth even if they sell now at a loss. Plus, the money they get from the sale is much needed, continuing to keep Ford off of the bailout list, which I give them a lot of credit for.

        When they hired Alan Mulally (IMO, one of the only CEO’s I know of who’s worth every penny) they were expecting exactly this. Mulally is famous for paring down Boeing to it’s profit-making essentials, and I really believe that he can do the same for Ford, even if it takes a while.

    • gStein_*|bringing starpipe back|* says:

      @Oranges w/ Cheese: ford/crysler/GM all had issues with differentiating their different lines, and i think that’s why they had such a hard time

  2. liquisoft says:

    I own a Volvo and I love it, but I can recognize that Volvo isn’t gaining much momentum in the US market. I don’t know what they’re specifically doing wrong, but maybe it’s the assumption that their cars are more “luxury” than anything else. My S40 wasn’t exactly cheap, but I don’t consider it a luxury car. But hey, I’m not necessarily the average American audience.

    • ARP says:

      @liquisoft: I think its because Volvo’s quality and amenities (like Saab) didn’t keep up with their price tag. You can’t charge low end Lexus prices and give Ford quality. It’s too bad, because I silently root for both of those brands. Here’s hoping that someone will take over the company, improve its quality, and again make it worth the price tag.

    • Sollus says:

      @liquisoft:

      Personally, I think their cars are hideous. Maybe that was a factor.

      • bunt says:

        @Sollus: really? i think the new saabs, and even more so the new volvos are extremely hot. have you seen the new s8? my god, its glorious.

  3. cromartie says:

    Did you guys miss the buy one get one free deal Ford gave Tata for Jaguar and Land Rover?

    And this deal is somehow worse? Really?

    • mac-phisto says:

      @cromartie: good. ford did little to advance those brands. jaguars still have the same reliability issues & land rover’s been losing market share with suburbanite trophy wives ever since mercedes unveiled its g500.

      plus, there’s the possibility that i could own a jag before i’m 50 if it had a $2,000 price tag. ;)

      • failurate says:

        @mac-phisto: Jags depreciate at an alarming rate. You can get a 2006 XJ, $55,000+ new, for around $22,000. Get one a few years older for close $10,000.

  4. banderlin says:

    $2 billion seems like a steal. Volvo’s got a great brand reputation.

  5. acknight says:

    Arguably, a good deal of that probably comes from the fact that the world-wide auto market, on the whole, is doing poorly right now. It’s not exactly an optimal time to be selling – except that they basically need to.

  6. fatcop says:

    A couple of billion?

    Will they take a check?

    • failurate says:

      @fatcop: What you do is, write them a check for $3 billion, and have them mail you back a check for $1 billion. Tell them some sob story about how your finance company will give you $ 1 billion for upgrades and admin costs, but they can only write one check for the deal due to some weird tax code in your country/state.

  7. pb5000 says:

    I used to work at a fancy hotel in the middle of FORD country (Dearborn, MI). Every year during the Auto Show, they would have the Swedish models, you know, the lady’s who show off the cars, and stay at my hotel. It was always a fun week knowing that any time the elevator doors opened it could be an amazing six foot blond beauty walking out.

  8. JulesNoctambule says:

    As a proud owner of a Volvo 940, I’ve never been a big fan of the Fauxvos and won’t be sad to see them go.

  9. ninjatoddler says:

    Good for Ford. I never understood the reason for having Volvo around Ford. Jaguar or Aston? Now that’s a shame.

  10. xkevin says:

    Its doubt it will be a total loss. Ford will sell the brand but force the buyer to continue using the Ford parts bin and/or share technology…

    • balthisar says:

      @xkevin: It won’t really be “forced.” They’ve gained a lot of efficiency by sharing parts and platforms. A new buyer can’t just stop using existing parts the next day. It would take a decade to source all new everything.

  11. The Cheat says:

    I’ve been considering a C30, does anyone have any experience with it? I won’t be seriously looking till at least September so I have a while to see what becomes of this sale.

    • eys says:

      @jcostantino: The mr and I got a c30 through Volvo’s overseas delivery program a few months ago. We’re really happy with it. The six-speed manual is a blast and it’s a really comfortable ride.

  12. docrice says:

    Wow, ford bought something that lost 70% of its value in 10 years… guess they now know how their buyers feel (although that’s more like 90%).

    …had to do it…

  13. coold8 says:

    Hope that selling goes well, otherwise liberals might have to change to Saabs.