Ford Motor is in negotiations with a Chinese company to sell its Volvo cars division, the Swedish business publication Dagens Industri reported today on its Web site.A Russian investor is also believed to be interested in acquiring the division, the report said.Media reports have suggested that the Chinese company involved in talks is Shanghai Automotive Industry Corp.
A Ford spokesman said: “We have been consistently saying since the end of last year that Volvo is not for sale. We are focused on improving Volvo’s business results.”
Ford’s new major shareholder Kirk Kerkorian, with a 6.49 percent holding, has stated he would like to see the cash strapped U.S. automotive giant divest itself of Volvo which it acquired for 50 billion Swedish crowns in 1999.
Ford’s CEO Alan Mulally began a strategic review around a year ago with the sale of Volvo thought to be among his goals. However the company has denied this.
A number of automotive companies have been connected with a purchase of Volvo over the last year, including Germany’s BMW and Japan’s Mazda.
The Volvo brand has shown good growth over the last few years in Europe, and has a revamped model line-up.
However, in the U.S. market, Volvo has skidded under exchange rate pressures, triggering several years of sales declines. Rather than reaching for a hoped-for goal of 200,000 North American sales by 2010, Volvo is instead trying to stop a slide below 90,000 units.
In response, Volvo calling on many unprofitable U.S. dealers to walk away from the franchise, an effort expected to cut about 20 percent of the dealerships by the end of the year.
Posted: June 26th, 2008 by admin
| Filed under US Auto News
Ford Motor Co. said on Thursday it will cut expenses for its white-collar work force by 15 percent over the next two months through job cuts,attrition and other actions.
The cuts, telegraphed by Ford in May, when it warned it would not meet its long-standing goal of returning to profitability in 2009, will come as the automaker adjusts to a deeper-than-expected slump in U.S. vehicle sales, led by declines in sales of pickup trucks and SUVs.
“We told employees today we are going to cut salaried workforce-related expenses by 15 percent and complete the actions by August 1,” said Ford spokeswoman Marcey Evans.
“This does include reductions in headcount and contract jobs, attrition and consolidation of positions,” she said.
Ford, the No. 2 U.S. automaker, has about 24,300 salaried workers in North America. It warned employees in May that cuts in production would force a reduction in its salaried and hourly work force.
Salaried workers who are dismissed will be offered standard company severance packages. Ford does not disclose details of the packages.
The automaker plans to offer buyouts to union-represented hourly workers at plants where the company has excess capacity due to declining demand for specific vehicles such as trucks and SUVs.
More than 38,000 hourly UAW-represented workers have left Ford through buyout programs, including about 4,200 who accepted offers that wrapped up in early 2008.
Ford executives have said the sharp rise in U.S. gas prices above $3.50 per gallon triggered a permanent shift in demand to cars and crossovers and away from larger vehicles.
The company has been shifting production plans toward smaller vehicles, including introducing a Fiesta subcompact in North America in 2010 that will be built in Mexico.
Posted: June 6th, 2008 by admin
| Filed under US Auto News