Volvo & Saab Sale Thread

[JasonR]

Re: Jerry York: I'd sell Volvo, Mercury if I were Ford chief

Volvo is a keeper. It needs better management, but Volvo is a somewhat recognized brand that has a background and could be solid enough to move on. They need a R&D revamp, better design, marketing, and voila. I've seen a couple of Volvos lately mostly s80s and I think they have something to work with. I can visualize them growing. About Mercury, well, I don't know if somebody would want to buy that. They are basically buying a nameplate, since this isn't a real company in terms of product development and infraestructure, and as a "brand" or name it has NOTHING to offer. I'd rather buy Kia than Mercury.

 

[Deutsch]

Re: Jerry York: I'd sell Volvo, Mercury if I were Ford chief

I don't get it? What hasn't Volvo been doing for Ford? They've given them safety technology that was obviously far beyond the "capable" minds of Ford engineers not to mention insight into making fuel efficient turbocharged powertrains that have lead to Ford introducing "EcoBoost". And how much MORE money does Ford need? Last time I checked they were doing pretty good back in the black. I guess the news reports were all hype? If this is true though, I have to wonder, where on earth could Volvo go where the brand wouldn't need a massive restructure and lose its brand equity as a result? I pity Volvo.

 

[Ultimate Car Guy]

Re: Jerry York: I'd sell Volvo, Mercury if I were Ford chief

What interests me about Volvo is that it’s unlike any of the other mid-range prestige manufacturers (such as VW, Renault, Peugeot, SAAB etc.) as it has a strong, clear and distinctive brand attribute i.e Safety.

In the mid to late 90s, Volvo greatly strengthened this attribute with the addition of great design. It’s car’s morphed from it’s infamous boxy shapes to designs that were very fluid, elegant and graceful. Although the car’s weren’t exactly engaging to drive, they still satisfied the criteria of good, safe and solid family cars that were great to look at.

It was because of this renaissance that Volvo became attractive to and subsequently acquired by Ford in 1998/1999. As a manufacturer, with a healthy balance sheet, strong engineering know-how (in safety), a great design leader (in Peter Horbury) and most importantly, strong future prospects, Volvo had a lot to offer Ford and the now defunct PAG. Volvo was very much a cash-cow.

I would say that Volvo peaked in 2002 with the launch of the XC90. But from thereon in, it was all downhill.

The departure of Peter Horbury to Ford meant that the company lost it’s design direction- all cars released after his tenure (S40, C30 and S80) were all too conservative. Design just carefully evolved when bigger and braver steps should have been taken.

Advancing technology was a lot more difficult for Volvo because it was restricted to whatever technology Ford was developing.

The fact that Ford in US has been struggling for the past 7 years would have curtailed the necessary investments Volvo needed to expand it’s product range and to advance new technology.

As for working out what to do with Volvo, and achieving the best outcome for the company and Ford? i'm working on it as you read...

 

[Bartek S.]

Is Volvo in crisis?


Ford has strenuously denied it is considering selling Volvo Cars, despite the Swedish carmaker running into financial trouble.
Volvo has posted a loss of $151m in the first quarter of 2008, compared with a $94m profit in the same quarter last year. Sources claim that Volvo could be poised to make significant job cuts to help to turn the financial situation around. Lewis Booth, chairman of Ford Europe, said “Volvo is not for sale and we are about improving the business”. Volvo is also under pressure from the strength of Swedish Krona against the US Dollar, which makes it very difficult to profit from export sales to the US.
Volvo sources told Autocar that sales of the new V70 estate car – the company’s bedrock model – had started to slide, despite the model being less than a year old.
Swedish Volvo dealers are said to have complained that the V70’s design was not distinctive enough and that the new model was not a significant step forward over the previous V70.
At a recent meeting of industrialists in Sweden, Volvo was also criticised by a brand specialist who questioned Volvo’s model strategy. The specialist suggested that a “family-orientated company” had made a mistake having three different saloon models in its line-up, and for investing in the compact, three-door C30 sports hatch. He also questioned Volvo’s lack of a large, stylish MPV.
Ford is also under public pressure form new investors. The Tracinda Group, an aggressive investment corporation led by Kirk Kerkorian has recently made a cash offer for 20 million Ford shares and a spokesman told the press that Ford should “sell Volvo and the US Mercury brand”.
autocar

 

[ZicZachZo]

Re: Is Volvo in crisis?

Shame that the workers have to pay the price for the execs not getting it right.

 

[Merc1]

BusinessWeek - Swedish Meatballs: Saab and Volvo

These U.S.-owned Swedish marques are struggling to reinvent themselves in the quest for buyers


Here's a story that may ring a bell.

A couple of carmakers are having trouble selling their vehicles. Hobbled by high fuel prices and poor rebadge jobs, not to mention prices that are too high to compete with others from Europe and Japan, these brands are scrambling to make smaller, more efficient machines that buyers will actually pay for.

Hey, welcome to the party, Volvo and Saab! You're just in time for the I-told-you-so-a-thon!

Right. Anyone could have told these once-proud, sorta-Swedish marques (Saab is owned by General Motors; Ford is Volvo's overlord) that their futures weren't very rosy. At Saab, the fault may rest in GM's lap, not back in Trollhatten. General Motors (GM) hasn't let Saab do anything creative, let alone steer itself in any direction other than toward total irrelevancy, for a good decade.

Oh wait, I forgot those neato, totally unrelated-to-anything-Saab-makes-now "Born from Jets" ads. Yeah, besides that they have the 9-3 and 9-5 on ancient platforms, the 9-7x, which is a Chevy Trailblazer in doughy Swedish drag, and for a cigarette break there was the idiotic "Saabaru" packaging of the Subaru WRX, reskinned as a Saab, that was painful to look at, if not unpleasant to drive. We'll never know what Saab would have done for an encore to that car since GM's bad debts forced it to sell its minority stake in Subaru to cash-cow Toyota Motor (TM).

The Downside of Green

As for Volvo, the challenges are only now arriving, since until recently, this was the only brand in Ford Motor's (F) now-dead Premier Automotive Group that wasn't burning through cash faster than a lotto millionaire. (Jaguar and Land Rover have recently been sold to India's Tata Motors (TTM); Aston Martin was flogged a year earlier.) So, under the benign eye of Ford, the kids in Goteberg made huge design progress with the iconic-looking XC90 crossover and the more recent C30 coupe.

But like famously angst-ridden compatriot filmmaker Ingmar Bergman, Volvo fears sexy. So instead of continuing its slammed and ultra-turboed R-edition cars—which were sometimes brilliant and sometimes not, but always faster than hell—these are, for all intents and purposes, neutered and dead. The reason: Volvo is worried about fuel economy. Question: Isn't a wagon that can haul five and is reasonably fast still better on gas than a big-as-a-McMansion SUV? Doesn't Lexus sell screaming sedans and also frugal hybrids? Anyhow, the XC90 is also about to drive off into the sunset, because it isn't kind enough to Mother Earth.

But wait, there's another chapter. It's called What's Next.

For Saab, there's a sliver of hope. Just as Saturn has pinned its brand to German maker Opel (also under the GM umbrella), Saab, too, gets restyled versions of these competent, occasionally brilliant cars. Too bad the execution is going so slowly; the Astra-derived 9-1 will have to wait until 2010 and the ancient 9-5 doesn't get overhauled until 2009.

If Saab still has a pulse 18 months from now there will be a 9-4 crossover to compete with the likes of BMW's (BMWG) 9-3 SportCombi, which is the wagon iteration of the Opel Vectra, is at least for sale right now, and has a killer selling point—it's actually new.

Volvos Are Admirable; BMWs Are Hot

Volvo's in a similar bind. It isn't BMW or Audi (NSUG). Its only caché is safety. Great for parents, but as a friend said to me the other day (when talking about his BMW), "Just because you're a parent doesn't mean you're dead!" Fine print: "I'm not a Volvo guy." Put another way, Volvos are admirable; BMWs are hot. And these days when Volvo tries to be hot, it's not. The V50 wagon is a good-looking wagon that's nowhere near as much fun to drive as the Audi A3 and yet it's priced similarly.

The C30 is gorgeous but impractical. Its external dimensions are similar to that of a VW Golf, but the base price is $10,000 higher. It has a rear hatch that's so narrow and squat that loading and unloading almost any object larger than a grocery bag is a hassle and there's no more storage capacity than you'd get from a Mini Cooper. Speaking of the Mini, that car boasts superior gas mileage and is way more entertaining to drive than the C30.

Don't think the upside isn't higher for Volvo than Saab, however. Volvo has a much bigger lineup and there are more models coming, like the smaller 2009 crossover XC60 that's expected to get Volvo's first hybrid drivetrain sometime early in the next decade. And Volvo's environmental commitment is fairly substantial, with managers seeking to downsize each car in the fleet and devise much cleaner, fuel-sipping products that will appeal to the vast audience of Americans who, if not unanimously concerned about the environment, are apoplectic about the current cost of gasoline. (What would Americans say if we had to pay Sweden's current toll: $6 a gallon?)

Tell Me a New Story

The trouble for both brands, though, is that their tropes are long-since obsolete. Anyone who can Google can find out that, for instance, a Volvo S60 has almost exactly the same safety scores from the National Highway Traffic Safety Administration as a Mercedes-Benz C-Class (you can get that stat yourself at safecar.gov). And it's much less trouble to discern that Saab turbocharges lots of its cars.

That was cool 30 years ago. Tell me something new. Oh, right, neither Volvo nor Saab has a new story to tell. And until they do, neither carmaker will have much of a future.


Swedish Meatballs: Saab and Volvo


M

 

[Imhotep Evil]

Re: BusinessWeek - Swedish Meatballs: Saab and Volvo

Volvo and Saab's problems stern from the fact that their cycles are very long (in traditional swedish auto fashion) and they've also let themselves lose their panaches (they brought numerous innovation witch differentiated them).
In other words they kept the bat but eliminated the good.

 

[Monster]

Re: BusinessWeek - Swedish Meatballs: Saab and Volvo

Ford has been doing the right thing with Volvo but their current sedan and wagon range, while good looking with top build quality, offers little excitement in terms of handling, performance and styling. The C30 is a good effort, an the XC 60 is another step towards the right direction.

GM has spent the past decade destroying Saab, it is a disgrace. Saab is an innovative company with many clever design concepts which never reach production because of the lack of funding. I am still waiting and hoping for GM to give Saab enough money so they can produce their variable compression engine.

The current theme for Saab Australia is ''individuality fully released'' Saab needs another radical innovation or technical breakthrough to gain recognition and respect from others. There is really no point about banging on and on about "Individuality" when ''individuality" won't mean it is a better path to take. Last year, Saab managed to sell 1500 cars across Australia, and during that year Australians bought more than a million cars. Mercedes or BMW sell more C or 3 series than that in 2 months. At the end, we all know the solution to Saab’s problem; they need a vast expansion of their line up, and the cars needs to at least match the competition in all areas. Easier said than done, but it has to be done.

 

[Merc1]

Motor Trend Blog on Mercury

Apart from giving Lincoln dealers extra vehicles to fill their lots, what, exactly, is Mercury for? I don't know. And I don't think Ford Motor Company has known for, oh, decades.

Edsel Ford founded Mercury in 1939 as a mid-priced brand to fit between Ford and Lincoln and compete with GM's Buick and Oldsmobile, and Chrysler Corp's Chrysler. That it lasted only until 1945 as a stand-alone division before being merged with Lincoln speaks volumes.

Full Blog:

The Trouble with Mercury | Car News Blog at Motor Trend


Hits it right on the head IMO. Mercury is likely the most irrelevant brand in the U.S. market.


M

 

[bmer]

Ford to Lower Volvo Production to Cut Costs

By MATTHEW DOLAN
May 20, 2008

Ford Motor Co. is cutting production at its Volvo unit as a way to trim the costs and losses at the upscale Swedish brand.

The production cut, which could affect one-third of workers at one of its two Volvo plants in Europe, comes amid speculation that Ford is priming Volvo for a sale. Ford has said publicly that it doesn't plan a sale, but Chief Executive Alan Mulally has told top executives he wants to eventually seek a buyer, according to people familiar with the matter.

"Our priority now is to improve the [Volvo] business dramatically," Mr. Mulally told analysts late last month. Jerome B. York, who advises one of Ford's largest outside investors, Kirk Kerkorian, endorsed the idea of a sale earlier this month, saying he believed Mr. Mulally would shed Volvo some time in the next 18 months.

Mr. Kerkorian's Tracinda Corp. extended a tender offer this month to buy as many as 20 million additional Ford shares. Ford's board is expected to make a recommendation on the offer no later than Thursday.

The Swedish auto maker announced Monday it could lay off as many as 700 workers with a plant-shift reduction. The move was earlier reported by the Web site for the local newspaper Göteborgs-Posten in an interview with Volvo Chief Executive Fredrik Arp.

"Whether it will be in December or January remains to be seen. We don't have the luxury to have 500 employees who aren't occupied for the day," Mr. Arp was quoted as saying about the shift cut.

By dropping one of its three shifts at its Torslanda plant in western Sweden, Volvo is scaling back where it makes larger, less popular vehicles. Volvo will also reduce the pace of production at the Swedish plant by close to one-third, to 44 cars an hour from 60 cars, at the end of June, Volvo spokesman Olle Axelson said.

He declined to say whether scaling back might also decrease revenue because there would be additional costs associated with producing a smaller number of vehicles.

No cutbacks are planned for its Belgium plant where the auto maker builds smaller vehicles, including its crossover XC60 sport-utility vehicle, Mr. Axelson said.

After raising doubts about whether Volvo fits into its future turnaround plans, Ford has also been concerned about Volvo's performance amid strong currency headwinds. Adverse exchange between the U.S. dollar and Swedish kronor has cost the auto maker an estimated $1.7 billion in losses in the past two years, according to Mr. Axelson.

Despite expansion in Russia and China, Volvo reported selling 22,000 fewer vehicles during the first quarter of this year compared with the same period a year ago, contributing to a $400 million reduction in revenues. The auto makerhas also been hurt by dwindling sales and its mix of vehicles. Volvo lost $151 million in the first quarter of this year, compared with a $94 million profit during the same quarter in 2007. Still, the company expects by the year's end to achieve about the same sales levels as 2007, Mr. Axelson said.

Monday's news reflects Volvo's efforts to reduce costs and improve efficiencies across the board. Like Ford, Volvo has offered buyouts to shed workers -- 3,000 in the last 2½ years from its total global work force of 25,000 -- and moved to reduce the number of its North American dealers from 350 down to less than 300 by the end of 2009. The Swedish auto maker also cut 100 positions through its consolidation to a single American headquarters in New Jersey.


Ford to Lower Volvo Production to Cut Costs - WSJ.com

 

[far2000]

Re: Ford to Lower Volvo Production to Cut Costs

Such a shame...Tey have no more creativity inthere lineup..

 

[siko]

Re: Ford to Lower Volvo Production to Cut Costs

The bigger shame is that Ford is destroying the brand.

Models in recent are simply dropping in quality. My aunt sold her mid-90s V70 2 years ago and got herself a S60 and XC90.

A decision she regrets. The XC has had many problems and is simply not up to par to the competition (considering its price) on things like equipment, performance, and materials quality. Also, the AWD system on that truck is one of the worse I've ever driven.

The S60 is better... but still not that great.

But what do you expect, both cars are built on the P2 platform... Volvo's name for Ford's D3 platform.



I really hope Ford sells Volvo fast!!

 

[LaArtist]

Volvo Cut 6000 Jobs

Stockholm - Volvo, the Swedish carmaker owned by Ford, is to shed a further 3,400 jobs mainly in its home base, the company said Wednesday, citing weaker sales in Europe and the United States.
The new cuts would affect some 2,000 blue-collar workers and 700 white-collar employees in Sweden, the company, which is owned by US carmaker Ford, said.
Combined with earlier announced job cuts, Volvo was to cut 6,000 employees, including 2,900 blue-collar workers, from its 25,000-strong workforce.
While job cuts will mostly impact operations in the Swedish west coast city of Gothenburg, an additional 600 Volvo employees outside of Sweden are to be made redundant.
In addition, contracts with some 700 consultants would be cancelled, the group said Wednesday.
'These are difficult times for the car industry in general, including Volvo. These actions are necessary to create a new and sustainable Volvo Car Corporation - a company with more focused operations and structure,' Volvo Car Chief Executive Stephen Odell said.
Odell added that 'the downturn in the global car industry is more drastic than expected.'
The carmaker earlier said it would reduce production by reducing night shifts. The carmaker is expected to sell 400,000 cars this year, compared to 457,000 in 2007.
Ford bought the Swedish brand in 1999.
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Man this is so sad, since im from gothenburg i know alot of ppl that are effected by this.
I heard that many fell into tears today at work..
This is a tragedy for Volvo, Gothenburg and Sweden..
Ive been talking to some friends over the last months, and everyone knew this was coming, as there has been production stops on 2 days of the week lately....
Damn the US and its shitty ill managed economics.. and damn Ford/Volvo for not realising that the world is tranforming, and they need to transform with it..


PS
The worst of all is the fact that all workers will HAVE to wait until december, to get more info on its them being axed or not..
Ofcourse they do this cause they know no one would turn up to work next day if they knew that they where getting axed after over 20 years of service at Volvo..
But its inhuman to make ppl wait when its such a delicate situation..
Ohh and on top of that, the right wing idiots are running our country and they have ****** up all the safety nets that was built up by the socialist party over the last 50 years..
So in short, ppl who will be laid off in Dec.. are F´ed Majorly

 

[Tarek]

Re: Volvo Cut 6000 Jobs

Damn that is major Kashif.

 

[LaArtist]

Re: Volvo Cut 6000 Jobs

^yeah there are many directions one can point the finger and blame..
1.Volvo
2.Ford
3.USA
4.Swedish Gov
5. CEO´s
( no specific order)
But one thing is for sure, you cant point it towards the poor workers..

I feel real bad for those with familys and big loans..

Normally you would say: Why take big loans and buy a nice house when you dont know whats gonna happen tomorrow??
But let me tell you this, in sweden ppl are very carefull..
But volvo was seen as one of THE most secure work places along with SKF..
So i dont blame these ppl at all..

 

[Tarek]

Re: Volvo Cut 6000 Jobs

^Interesting facts,it is unfortunate indeed what those workers gonna have to face in the future.

IMO Ford are the worst parent company in history.

 

[Centurion]

Re: Volvo Cut 6000 Jobs

I told you guys about this two years back. This is just the begining. What I been saying all along is that XC90 is the sole car that's kept Volvo alive for the recent 5 years. Now when it's old the sales are crippling while Volvo don't have anything else desirable to offer. Volvo is a dying manufacturer and they are themselves to blame for it.

 

[warot]

Re: Volvo Cut 6000 Jobs

I'm sorry to hear about your friends being affected in all this, it's terrible. But while inhuman as you say it, December is only 2 months away. Can't just let people go all of a sudden if that makes sense. You just have to see if Volvo's way.

Now, as for blaming the US economy for this, I think that might be a notch too far. Volvo was doing mediocre for a few years now, before this whole economic crisis. I personally thought they had so much potential, to the point where I hope BMW took over from them. But they had time to do something to save themselves imo. Now it might be too late.

Everyone is hurting now. Not one car manufacturer will claim otherwise.

 

[LaArtist]

Re: Volvo Cut 6000 Jobs

^its not going to far..
Everything is linked to the shitty economical governing of the US
but like luw said..its volvo´s own fault.. They should have stoped it from selling to Ford..
And they should have moved WITH time.. not AGAINST it..

 

[Centurion]

Re: Volvo Cut 6000 Jobs

I don't think that Ford the the ones to fully blame for this. Volvo simply never evolved their models. A new model was pretty much the same as the previous one with no innovation in design, driving dynamics or luxury. Thye've simply not developed products that people want.