AFSCME 3357-HOF'S BLOG

Is Ford Selling Volvo?
Who's going to design future Fords?

Only Ford's hairdresser knows for sure if the the automaker is planning on selling the Volvo brand. Contradictory reports have been bantered about in the press over the weekend and spilling into today. Volvo is one of the few parts of Ford that is making money, $402 million in the first quarter of 2007 according to Forbes magazine. For has pledged most of its industrial assets to get working capital for its turn around plan, so tough decisions regarding asset sales may be inevitable. It's not clear how much cash would actually realize if it sold Volvo. According to Edmunds.com, Volvo was one of the assets that Ford pledged to get the working capital. The mortgagee would seem to have the upper hand in negotiations to remove the security interest over the Volvo assets.

Volvo is more than just a niche marketer of "boxy but good", safe European cars, Volvo engineering contributes to most of Ford's design. The Ford Five Hundred/ (new) Taurus and Freestyle ride on a Volvo platform. If you take away the Volvo-engineered cars, and the Mazda-derived cars including the Fusion/Milan/MKS and Focus, it doesn't leave much in the way of passenger cars, just the niche market Mustang and the ancient but vanishing Crown Vic. As much as Ford likes to complain about the cost and productivity of the UAW members, it seems that Ford is getting much less productivity out of its engineering employees. Other than the Mustang and its organ donor the Lincoln LS, I can't think of a single new-from-the-ground-up passenger car that Ford has engineered in the United States and introduced in the past 10 years. All those engineers can't be working on trucks, can they?