Buyers eyeing Volvo Cars: Ford

US car maker Ford revealed on Wednesday it is in detailed talks with potential buyers for its Volvo Cars subsidiary.

“Ford has held preliminary discussions with several parties interesting in buying Volvo Cars,” spokesman John Gardiner said in a written statement.

The US company “has been pleased with the number and quality of these parties, and preliminary discussions have been held to ascertain their level of interest in the Volvo business,” he added.

“Ford is now talking in more detail to these interested parties about the future for Volvo,” he said.

Gardiner said that, while the talks could lead to a sale of the beleaguered Swedish company, “no final decisions have been made at this stage and this process will still take some time to unfold.”

Contacted by AFP, he refused to disclose the names or nationalities of the potential buyers, and said no timeframe had been laid out.

“We haven’t quantified the timing but the process will take time,” he said.

On March 10, the Financial Times reported that China’s second-biggest carmaker Geely was interested in buying Volvo Cars, citing sources close to the dossier.

Ford, which unlike the two other big US automakers General Motors and Chrysler has not received federal aid, announced in December that it was considering selling Volvo Cars.

It acquired the Swedish brand in 1999 for 6.45 billion dollars.

Volvo Cars holds 1.3 percent of the European market and 0.5 percent of the US market, according to Ford.

Volvo Cars employs some 20,000 people worldwide, including 15,000 in Sweden.


Sweden’s Volvo regains strength after pandemic puts brakes on earnings

Swedish truck maker Volvo Group was hit by a sharp drop in earnings due to the coronavirus pandemic, but business rebounded at the end of the year.

Sweden's Volvo regains strength after pandemic puts brakes on earnings
Volvo Group CEO Martin Lundstedt. Photo: Adam Ihse/TT

In 2020, the group saw “dramatic fluctuations in demand” due to the Covid-19 pandemic, chief executive Martin Lundstedt said in a statement.

For 2021, Volvo raised its sales forecasts in its trucks division – its core business – in Europe, North America and Brazil.

However, it said it also expected “production disturbances and increased costs” due to a “strained” supply chain, noting a global shortage of semiconductors across industries.

The truck making sector is particularly sensitive to the global economic situation and is usually hard hit during crises.

In March, as the pandemic took hold around the world, Volvo suspended operations at most of its sites in 18 countries and halted production at Renault Trucks, which it owns, in Belgium and France.

Operations gradually resumed mid-year, but not enough to compensate for the drop in earnings.

With annual sales down 22 percent to 338 billion kronor (33.4 billion euros, $40 billion), the group posted a 46 percent plunge in net profit to 19.3 billion kronor (1.9 billion euros).

Operating margin fell from 11.5 to 8.1 percent.

However, the group did manage to cut costs by 20 percent.

“We have significantly improved our volume and cost flexibility, which were crucial factors behind our earnings resilience in 2020,” the group said.

Volvo's business regained strength in the second half of the year.

“Customer usage of trucks and machines increased when the Covid-19 restrictions were eased during the summer and this development continued during both the third and fourth quarters,” it said.

“Both the transport activity and the construction business are back at levels on par with the prior year in most markets.”

For the fourth quarter alone, the company reported a 38-percent rise in net profit from a year earlier.