Ford Motor announced today that it was evaluating its options for its Volvo subsidiary, including the "possible sale" of its loss-making Swedish premium brand. In fact, according to the Wall Street Journal , Ford is intentioned to concentrate and focalize on their main brand, after having already disposed Jaguar and Land Rover. Volvo was acquired by the American Group in 1999 from Swedish Ab Volvo.
Experiencing a continuous decrease in market share and sales, the disposal of the Swedish brand seemed the most probable solution. It must be noted, though, that already the previous year this option was taken into consideration, but shortly left aside as Ford's CEO, Alan Mulally, said that it had plans to relaunch the brand. Nevertheless Volvo's sales in the United States continuously plunged, decreasing 52% in October and 28% during the firs ten months of 2008.
Due to this reason, Mulally declared that considering today's financial context together with Ford's external problems, it is vital evaluating any possible solution for the future of Volvo, strong worldwide player, which is experiencing a difficult period.
Ford must thus pay extreme attention in analyzing every possible outcome and effectively evaluate whether the disposal of Volvo really incorporates part of an effective strategy in order to come out of this negative situation.
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