Safety First: Daimler reportedly passes on buying Volvo
Volvo and Mercedes-Benz have been known for decades as automotive safety pioneers, sharing between them the bulk of new innovations in the field. These days, however, automakers are as as concerned about their financial security as they are with occupant safety. With the latter in mind, reports indicate that Mercedes parent company Daimler has decided against buying Volvo from Ford.Amidst slumping sales and a troubled future, reports surfaced a month ago that Ford was looking for a buyer for the last remnant of its ill-fated Premier Auto Group, after Land Rover, Jaguar and Aston Martin were all sold off to Asian investors. Ford bought the Swedish automaker from the Volvo group for $6.45 billion back in 1999, and is looking to offload it for $6 billion today. Unfortunately for FoMoCo, nobody seems to have the cash. The Volvo group has rejected the possibility of buying its car division back, the Swedish government isn't interested, BMW reportedly considered the prospect but ultimately rejected it, and now Daimler, which has had its fill of acquisition deals with Detroit, has passed as well. At this point, Chinese automakers like Shanghai (SAIC) and Geely, as well as Korean automaker Hyundai seem like the only tenable prospective buyers left.
[Source: Economic Times]
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Reader Comments (Page 1 of 1)
W. Kirk Crawford 12:07PM (1/04/2009)
After Chrysler they are getting gun shy?
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Brn 1:03PM (1/04/2009)
I don't know if Daimler is gun shy, but we should be. They ruined Chrysler. I don't want them to run Volvo
MemphisNET 12:07PM (1/04/2009)
They would have ruined Volvo anyway.
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LDMAN 12:13PM (1/04/2009)
No one is going to pay $6 billion for Volvo. Not the Chinese, not the Koreans. know that FoMoCo needs the cash but they are in a better position than GM or Chrysler and are getting funds from US Tax payers. The sad thing is that the Volvo guys I met where as much "Ford people" as the Lincoln or Mercury guys. Being sold must really hurt them.
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Sea Urchin 12:19PM (1/04/2009)
Why not just take some of the bailout money and try to get by thru the first 6-7 months of 2009. By that time the economy will improve.
Once the car market improves Volvo will become far more valuable, as long as ford continues to invest in technology. Also there's no better car on earth to be outfitted with that new hybrid system Ford has in Fusion to be in one of Volvo's wagons.
ASEVENSEE4 12:15PM (1/04/2009)
SAIC would suck Volvo suck all of the good out of them and leave them out to hang like they did that Korean automaker.
Ford should just keep Volvo
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ASEVENSEE4 12:17PM (1/04/2009)
lolz
SAIC wouldn't be a good buyer, they would suck all of the good out of Volvo and leave them out to hang like they did that Korean automaker.
Jake B 2:16PM (1/04/2009)
Agreed
Chase 12:42PM (1/04/2009)
I think Volvo+Mazda+Ford has worked out great for platform sharing. I can see why they would want to sell them in the short term, but in terms of the long term, Volvo has added a lot to the company other than sales.
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Mazda FTW! 1:30PM (1/04/2009)
I agree. That partnership was one of the few in the auto-industry that actually produced extremely good products. Usually when a bunch car-makers get together you get class-acts like that VW mini-van based on the Caravan or the horrible "World Engines" doing duty in the Mitsus and Dodges.
The Ford-Volvo-Mazda partnership is awesome. Keep it Ford. Try thinking long term for a change.
Vijay 1:06PM (1/05/2009)
Exactly. I fail to understand what Ford is thinking here.
In 1998, when the sale of Volvo to Ford was announced, I was pessimistic. I'm happy to see how wrong I was. Ford very effectively sheltered PAG, and used Volvo to enhance Ford's own brand. I think it is safe to safe than Volvo changed Ford as much as (or more than) Ford changed Volvo. Ford got world-class engineers, and Volvo got Ford's scale. With Mazda, the combined company produced the descendants of the Volvo P2 platform (C1 and EUCD). Currently, all three platforms (P2 now called D3 by Ford) form the backbone of the Ford and Volvo family car lines. In fact, the Ford Fusion and Mazda 6 are the only notable exceptions.
At this point, if they sell the Volvo car marque, and keep the technology, they'll lose out on a very rabid fanbase. If Ford sells the Volvo car company, then they'll need to deal with sharing at least three platforms with competitors.
It makes no sense for Ford, nor for Volvo, to separate this union. Maybe Ford is simply trying to assuage fears of shareholders, by playing that they will sell Volvo?
Judy Zik 1:15PM (1/04/2009)
Good news for Ford. This was a win-win. If they could actually find someone willing to pay $6 Billion in this economy that would have been a win. Realistically they will get to keep Volvo because nobody will pay that for it. Putting it up for sale got them the bailout from the Swedish government and keeps congress from using not selling Volvo against them if they decide to get a bailout loan someday. Plus they get to keep Volvo. All wins.
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firstplace 2:47PM (1/04/2009)
No offense to any volvo owners but they really need to go bankrupt and start over. They have nothing outstanding. Everything they do subaru or toyota do cheaper and BMW or Cadillac can do luxury better. They have failed to progress with the times. Not that they are bad cars, just that there is always something in there class better for about the same $$ or slightly less luxury but everything else as good for much less $$. Once again I dont want to offend anyone, but volvo hasent had its game face on for about a decade.
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hypermiler 5:02PM (1/04/2009)
Right now, Chinese are the only realistic buyers of Volvo. Euro automakers are trying to get their own collective asses bailed out, while Hyundai is not interested in any Euro brand that does not have BMW-like pricing range($40,000~100,000). The only brand Hyundai has set eyes on right now is Jeep.
That leaves Chinese as sole likely bidders. That doesn't mean Volvo will prosper under Chinese ownership, since Chinese are only interested in Volvo brand and technology, and let Volvo die after looting all the available technology.
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AntBee 5:27PM (1/04/2009)
What about Porsche buying Volvo? They seem to be flush with cash, what with being the most profitable auto company in the world and all.
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OOMPH! 5:56PM (1/04/2009)
Porsche VW would be my bet!! Volvo teamin up with Skoda!
Avinash machado 1:26AM (1/05/2009)
What about Renault-Nissan or VW?
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imoore 9:37AM (1/05/2009)
If the Chinese do buy Volvo, I doubt it will be SAIC. With the mess on their hands with Ssangyong, Roewe and MG, It'll be a miracle if they can continue to operate without collapsing completely.
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Mi key 8:32PM (1/09/2009)
Good for Seems Volvo they Dodged the Daimler Bullet.
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Mi key 8:34PM (1/09/2009)
That's "Good for Volvo, they've Dodged the Daimler Bullet."
Sorry for the double post.
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