Ford has announced it will ‘re-evaluate strategic options for Volvo Car Corporation, including the possible sale.’ GM is almost certainly doing the same with Saab. If you want to buy a money-losing Swedish car company, you’ve now got not one but two chances. Emailed your bid yet?
Thought not. Ford and GM won’t be able to raise quick cash by selling off Volvo and Saab.
No, the reason they both want rid is that they have never really been able to make consistent money out of them. Worse, they just distract management from healing the sickness at the hearts of the main companies back in Detroit.
Trouble is, they won’t be able to unshackle themselves any time soon. These things take months. GM has already had Hummer on the block for most of 2008 with no buyer. It took months and months for Ford to sell off Jaguar Land Rover.
First, a buyer has to be found. And at the moment the main aim of every car company, including the ones that look healthy, is to spend as little money as possible. Buying Volvo or Saab involves spending money so which car company would go for it?
Second, even if a buyer does turn up, the process of due diligence is painfully slow.
Volvo will be a part of Ford for at least a year, I’ll predict.
And as for Saab, I’d say it’s more likely that GM will close it down than successfully sell it. Because if GM is to secure Federal aid, it will have to show it’s ready to swing the axe big-time. Why should Congress mind if it’s Swedes who suffer?