Ford Talks with Renault, China's Dongfeng for Volvo, Report Says
By Michelle Krebs July 1, 2008Ford reportedly has revived talks with France's Renault about the potential sale of Volvo, Reuters reports. The newswire, quoting unnamed sources, said Ford and Renault held exploratory talks in the third quarter of 2007, but conversations stalled over price. However, sales talks recently re-started, Reuters reported.
The newswire also claims Ford has spoken to China's third-largest automaker Dongfeng Motor Corp., which has joint ventures with Nissan, Honda, Kia and Peugeot in China, about Volvo.
Ford insists Volvo is not for sale and instead is focused its return to profitability. Still, rumors of a possible sale resurfaced last week when Volvo announced layoffs and cost-cutting efforts.
Ford is under pressure to sell Volvo by one of its largest shareholders, Las Vegas billionaire Kirk Kerkorian's Tracinda Corp. Plus Ford needs cash.
Untangling Volvo from Ford would be challenging, but might not be necessary with the right affiliation. Nissan-Renault's Carlos Ghosn has shown a willingness to be innovative in alliances. For instance, Renault and General Motors build commercial vehicles together in Europe. Nissan recently announced a partnership with Chrysler whereby Chrysler will build a version of its Dodge Ram for Nissan to sell as a Titan replacement while Nissan will provide Chrysler with small cars based on the Versa.
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