In an interview with Bloomberg, Ford’s European CEO, John Fleming, said that The Blue Oval Boyz aim to sell their Volvo-shaped money pit by the end of this year. More importantly, they have no intentions in keeping any remaining stake in their money-losing Swedish subdivision: “it has not even been considered.” Fleming also confirmed that Ford’s negotiating with “a number of parties” about the sale. Need they mention any names? Ford is looking for $2 billion for the moribund brand—less then a third of what The Glass House Gang paid for Volvo way back in 1999. Not to mention billions more spent in a hugely unsuccessful attempt to take the brand up market. “It’s not the global economic downfall that has sparked the decision to sell Volvo,” Fleming said, without dwelling on Ford’s patently inglorious management. “We’ve been in a process of separating Volvo and Ford for a year already.”
Meanwhile, the Swedish press reports that former parent company Volvo AB has dismissed rumors that they have any interest in participating in a deal to buy Volvo’s passenger car division.
That said, Volvo AB owns 50 percent of the copyright to the Volvo name; they’re only interested in protecting their good name (no Chinese takeaway for you kamrat). “It is only natural that the interested buyers contact us in this regard,” says Mårten Wikforss, chief of press at Volvo AB to Swedish newsaggency TT.
Meanwhile, hard times in the truck world. e24.se reports that Volvo AB has reported a 54 percent reduced turnover in their truck and heavy goods vehicle (HGV) sales, comparing July this year to July 2008.
There might be a connection there . . . .
Ford should have kept Volvo and dumped Lincoln. Despite it’s neglected state, Volvo has not been ruined by Ford like Lincoln has. Volvo, in most circles, is still considered a legit. luxury brand.
Lincoln just competes with Buick.
P71_Crownvic,
I agree with you. If Ford were planning on keeping a luxury marque (and they should) I would have gone with Volvo and not Lincoln.
Volvo has a global appeal and still has a cache (my engineering uncle still associates Volvo with safety, despite the fact that Renault took that crown a long time ago) and their cars are quite nice. Whereas Lincoln is a regional brand (North America? Or is there anywhere else?) and probably won’t be missed.
I’m not saying Volvo isn’t a damaged brand, because it is. But if I had the resources to restore one brand, I know which one I’d plough my money into.
What’s also curious about this story is the part where Ford state they won’t keep a minority share of Volvo after sale. This strikes me as rather dangerous.
Effectively, when Geely (don’t tell me there’s another buyer) get hold of Volvo, they’ll have access to a wealth of safety technology and other features to catapault them into Western buyers’ minds.
In short, I think Ford would be loading a gun and pointing it at their own head (and other car makers’ heads) if they handed Volvo over, lock, stock and barrel, over to the Chinese.
How they thought they could take the brand up market without a flagship rear wheel drive model is beyond my imagination.
Is that the same Lincoln that has the freshest product line-up in the luxury segment? The same Lincoln that outsold Cadillac in May and July? The same Lincoln that has grown market share in 2009?
Doesn’t look to me like a brand that Ford has ruined. It looks to me like a brand that Ford has seriously invested in.
Lets look at the Lincoln line-up in 2005 shall we:
Mark LT
Aviator
Navigator
Town Car
Zephyr
Now lets see how Ford has ruined Lincoln since then (!!)
MKS
MKT
MKX
MKZ
Town Car for Fleets
Navigator
Either way you cut it, that is a significant investment in product for Lincoln and the increase in market share is a sign that things are turning out well for Lincoln.
Katie & P71_Crownvic,
I’d argue that neither Volvo nor Lincoln are luxury brands. Lincoln has been a joke in the US and all but unknown outside; current models IMHO indicate they have at least found their mojo again, but a luxury brand they ain’t: more like a bit more uptown Fords. (Which is what they are, really.) Single-handedly owning the stretched airport limo market screams taxicab rather than deluxe.
Volvo has been suffering from very poor positioning: the S40 is too small to compete with the BMW 3 Series et al., the S60 is so not luxury it hurts, and again too small to compete with the 5 Series crowd. The S80 is a barge that is too big to compete with 5 etc. but too small to be considered real luxury like the S-Class. (And quite frankly, no Volvo interior even remotely competes with anything Lexus, BMW or Audi have to offer.) I was seriously considering buying an S40 because I truly like the design, but it really is just an overpriced Euro-Focus with slightly ritzier plastics. (The operative word here is “slightly”.)
I fail to see how any buyer of Volvo could remedy that situation within the foreseeable future. Putting Volvos on Ford platforms has basically taken the entire model range out of the competition.
Fleming said, without dwelling on Ford’s patently inglorious management. “We’ve been in a process of separating Volvo and Ford for a year already.”
well, I don´t think this one is true. Aren´t they using Volvo’s platforms in most of ford´s cars? How on earth are they going to produce new (ultra safe) platforms? Maybe selling Volvo could become a bigger burden for Ford than keeping it.
Your left elbow is all you need to know why Volvo went downhill. The 2, 7, 9, and 8 series cars all had fabulously located, flat window sills. There is a very slight downward slope toward the driver and the defined edge is slightly rounded. It’s a great place to rest your arm while keeping your hand on the steering wheel. This works great with the window open or closed.
From the S80 on, the window sill is so uncomfortable you find yourself searching for a properly located, comfortable arm rest in the door. There isn’t one.
At the same time they became less comfortable, they became more expensive and less reliable. No mysteries here.
well, I don´t think this one is true. Aren´t they using Volvo’s platforms in most of ford´s cars? How on earth are they going to produce new (ultra safe) platforms? Maybe selling Volvo could become a bigger burden for Ford than keeping it.
Ouside of the “D” platform they are all Ford’s platforms (developed by Ford, Volvo, Mazda and to an extent Jaguar). The patents and designs belong to Ford, they aren’t going to ship them off and not be able to use them and additionally how many of those engineers work for Ford Europe or will stay with Ford once it sells. Ford has finally managed to become globally integrated, once they learned what they needed to learn from mazda they let that go (it shows in thier european car’s) and they’ve learned what they needed to learn from Volvo (Ford’s safety is second to none). In terms of luxury, AM’s whole goal was to focus on Ford (where the money is made, would GM have been better off pouring money into Chevy rather Cadillac the last ten years?) and once that is done begin to fix Lincoln (that is beginning to be done). And then when the whole industry shakes itself out in the next ten years if you want to buy a luxo maker, then do it (how long can BMW and Mercedes remain independent (well Daimler is a large comglomerate), but I doubt that market (luxury) will ever go back to what we’ve seen in the last 8 years.
Volvo made a crucial mistake when it started chasing the luxury/fashion market instead of going its own way. Once Volvo became a one to one competitor with Audi, Acura, Lexus et. al. it was doomed. The fashion buyer is fickle, always looking for the next thing. When lighting strikes your product there is plenty of money to be made … and then it is over. Big party, horrific hangover.
Volvo should have stuck with the traditional Swedish mindset of practicality, durability, safety, social awareness and snuggling close on those long winter nights. Volvo had the EC concept electric car in 1977, a hybrid concept car (ECC) in 1992 and a host of other prototypes which could have been developed into high end “green” cars. But no, Volvo got caught up in doing what all the other companies were doing. Volvo could have been the premium branded practical vehicle which sold on environmental friendliness and low total life-cycle cost of ownership. A car for the thinking person, not for the People magazine reading masses. But no, Volvo took another direction even pre-Ford, and once Ford was involved there was no going back. Then again, Nokia made the same mistake. They went for the phone as fashion only to get their butts kicked by the lighting fast competition from Korea and the breakthrough idea execution from Cupertino.
Ford should have kept Volvo and dumped Lincoln. Despite it’s neglected state, Volvo has not been ruined by Ford like Lincoln has. Volvo, in most circles, is still considered a legit. luxury brand.
I’d probably go a little further and say that Lincoln and Mercury should both have been left to rot, and Ford perhaps should have kept Land Rover, Jaguar and/or Aston. That would give them a neat, tidy lineup that ends at Ford, moves to Volvo and then splits into Jaguar (sedans, which means the XK needed to go), Aston (sports cars) and LR.
That said, Ford was still smart to sell those three when the market was there. GM can’t give away it’s deadwood.
Volvo wasn’t considered a luxury brand until the S80 was introduced in the late 90s. They sold at a slight premium to an American car because they were worth that…it wasn’t until they started chasing BMW and MB that they declined. Part of that is to blame on Ford, part of previous Volvo management.
In Europe, they competed with the Pugs and Audis…which wasn’t as luxurious until the A8 came along. Same can be said about Saab, it is another quirky brand that sold at a slightly higher premium and the car justified that. Their technological advances were the drivetrain and chassis…not electronic gizmos and more flash.
Own an older one of these models and you’ll get a better understanding of what a Volvo was or should be. My dad considered an 86 740 but ended up buying a Taurus MT5, the price wasn’t much different…both were about the same size, about the same power, but the Taurus was a looker! The Volvo would have lasted longer, as my 84 760 Turbo has just about finally kicked the bucket (turbo-related issue). Volvo didn’t need a huge market back then…and unfortunately I’d like to think they don’t now but the market is too crowded as it is.
For a long time, Ford and Volvo followed a similiar path: make simple, stodgy, rugged, and reliable cars. Not the hot-rod models we all remember, but the Falcons, Fairlanes, 200-series, 700-series. For Ford, that started changing in the 70s (at least in the NA market) and Volvo, the 90s. Ford is starting to gain some of that back but any company has to be everything to everyone to stay competitive.
Finally, I’m glad Ford is selling Volvo…it’s only wasting their resources. I hope Volvo AB buys them but we’ll see if that happens. I wouldn’t mind if Renault bought Volvo either, always a tie between the two.
As it has been said before, Ford would be wise to dump Mercury and put Lincoln to 2 models; something akin to the Town Car and Navigator. Even if they’re only hire cars, it’s what Lincoln has always done well.
Volvo made a crucial mistake when it started chasing the luxury/fashion market instead of going its own way.
I don’t think it’s so much that they lost the plot as they were competing in a market—the semi-premium car—that utterly vanished. What’s the point of a car that’s not quite as good as a Mercedes or Lexus, but still more expensive than a nice Accord or Camry?
The same thing afflicted Saab and Acura, and to a lesser degree Lincoln and Mercury: they market was split between downmarket luxury brands and top-trim mainstreamers. There’s not a lot of room there, and VW is barely able to make a dime off it in North America. Subaru and Mazda face similar troubles
In that space, wither Volvo? Do they really have the resources to go downmarket?
Volvo is as much a luxury brand as Buick, which isn’t saying much
Ford shoulda played Volvo as the Subie of European premium cars–premium but unique and happy to go it alone. All of Ford’s green/hybrid tech shoulda gone into Volvo–to play up the latte sipping, east coast, PhD stereotype of low-keyed, intelligent luxury.
“Volvo as a safe car” is a theme that’s 40 years dead…..nowadays with safety regulations and technology Volvo is no more safe than a well designed Honda or Caddy or even a Renault, lol!.
Ford should just stick to trucks and mass market sedans…..when has Lincoln ever even been equal to Caddy?
I have to chime in to disagree with P71 and Katie. Lincoln is a better fit right now. 2 points:
First, let us not forget that much of Lincoln’s current plight was by design, as it was given the restricted slot of “American Luxury” (translated Town Cars for 80 year olds) in Nasser’s Premium Auto Group.
Second, Now that the PAG has been axed, you have a choice between two brands in the running to become FoMoCo’s luxury contender. One, Lincoln, has the storied pedigree. It has been, off and on in the past, a genuine luxury contender. I’m thinking of the 20s-30s, early postwar Continental, and in the 60s-70s. Maybe even the 80s Mark VII LSC. Granted, this is not the best of foundations, but it is at least something to work with.
The other choice is Volvo, which was never, ever a luxury car, and is not one now. It never will be. Any cachet that Volvo has is for safety (and it is as much a safety king as Lincoln is a luxury car today) and quality (ditto.) Its buyers are people who had good 240s and 740s, and now have more money to spend and have that certain snobbery that anything European shows the owner as more enlightend than anybody who drives something from Detroit. “Ugh. They probably shop at Sam’s Club, too.” But these are not people who cross-shop BMW, MB or Lexus.
I believe that Lincoln is repairable, with a lot of work. I don’t see Volvo as a genuine luxury contender, no matter how much money they spend on it.
” .. when has Lincoln ever even been equal to Caddy?”
The 1961-1963 Lincoln Continental put its contemporary Cadillacs to shame. In fact, throughout the 1960s Lincoln was very much the equal of, if not better than, Cadillac.
John Horner: +1. Also, everything Lincoln built during the 70s beat Cadillac in quality and image by perhaps a factor of 2. By the 70s, Cadillac buyers were buying a nameplate while Lincoln buyers were buying the car. My father had 3 different Lincolns of that era and I always found them much more appealing and made with much higher quality materials than contemporary Caddies.
I would go further back as well. The Lincoln Model Ks of the 30s (and also the cars of the 20s) were every bit as good (if not better) than any contemporary Cadillac.
Fun fact of the day, some of our younger readers may not know that Lincoln’s founder, Henry Leland, a pioneer in high quality precision manufacturing, was the same guy who had started Cadillac about 20 years earlier.
I bought a 2008 V70 this year as a leftover. It was the last V70 the dealer had (of any model year) and they wanted it gone so they could concentrate on the XC60 (this is what the sales associate told me). The sticker was in the $40k range and I got it out the door at about $30k.
For $30k, it is an excellent car. It’s very comfortable and quiet and is very well thought out. There are tons of tiny little design features that you don’t notice until you try to use the car for hauling stuff that make it all so much simpler and easier. From what I’ve read and seen, not all of these features are on the XC60.
At the $40k sticker price there is no way I’d touch this car, but at $30k I can’t think of anything else that is as useful, simple, comfortable, and safe. It’s a true Volvo in every sense.
But look at the sales numbers and without the mass-market-appeal SUVs, I doubt that there is any justification for the brand to continue to exist. The Swedish niche just plain doesn’t support the modern-day costs of vehicle development. Perhaps if Saab and Volvo had merged they could have survived without selling out. Maybe.
The best we can hope for now is that they stay willing to bring over the real cars and accept sales that number in the hundreds each month while they sell the mass-market cars to keep the lights on [barely].
I would agree that Lincoln was better during that era, but the 69-70 Caddy was a beautiful car.
Volvo’s dive in reliability has been a big problem. Their premium pricing for near-premium features is another problem. Poor mileage on their models isn’t helping either.
As a European car with a slight price premium, they would have been fine. At the prices they want, I’d buy a BMW.
Lincoln is a dead brand walking. Frankly a new, from scratch, luxury brand would have more cache. A Hyundai Genesis has more cache. Lincoln is a brand with no focus, scared to alienate its old customers, and being ground into dirt. There is no other brand that needs a halo, uber-luxury, state of the art car more, and no other brand that is less capable of executing it.
People can talk about heritage as much as they want – but frankly buying a car is about “what have you done for me lately”, who cares if a 1920’s Lincoln was a great luxury car when the current one is terrible? Volvo, today, has more exciting designs and a more interesting direction, but just isn’t competitive at the price point they are trying to get.
Chicago Dude, I bought the the same leftover 2008 v70 at the same price with the same starting sticker about six months ago. Your’s isn’t also grey by chance? :) I agree, for 30k, a nice car with a lot of useful features. For 40k, I wouldn’t have considered it.
That said, Volvo still has a lot of positive brand equity out there. People say two things when they see I have a Volvo, 1. its a safe car, 2. It will last forever. Now, only time will tell if it deserves that reputation, but at least where I live, the brand still has something positive to work with.
Yes lincoln is renewed. You can buy a Taurus or a lincoln M something or other. You will be told that the V6’s with turbos can perform with the old v8’s. What you won’t be told is that the new Msomething or other and the Tarurus weigh about 4300 pounds right where the frame on body v8 town car is. Some early road tests on the Taurus SHO (which compares with the lincoln,) 16MPG is what the thing averaged. Would the town car be worse? It is not enough to redo a car you have to take it to the next level with efficiency and performance. Will this save Ford? The jury is still out, but I think not. Did I forget to tell you the Ford SHO sells for about $10.00 per pound.
slateslate wrote:
when has Lincoln ever even been equal to Caddy?
For the livery market, Lincoln Town Car beats the FWD Caddies hands down. It’s not even a contest. That’s what Ford should keep Lincoln for. Get rid of the other, derivative models.
Volvo can be sold for 2 billion.
Lincoln would cost money to get rid of.
What we’re missing here is that Volvos actually sold pretty well until the last couple of years; the decline is actually pretty recent. They made two critical boo-boos:
1) Holding on to models too long. The last-gen S80 actually sold well for quite a few years, but they didn’t so much as facelift it for like nine years, so the last couple years of its run found it a dead model walking. Same for the S60. Then, when they introduced the redesigned S80, it has all the personality of an ATM machine – a total yawn and a bomb. At least the previous-gen S80 and S60 had personality. And now they’re running the XC90 into the ground. Don’t even get me started on the boxy old RWD models.
2) Safety became a given in even the cheapest cars, taking away their one traditional selling point in the marketplace, and Volvo couldn’t find anything to replace it with.
Sad…but that’s how the cookie crumbles.
P71_CrownVic :
August 27th, 2009 at 8:46 am
Ford should have kept Volvo and dumped Lincoln. Despite it’s neglected state, Volvo has not been ruined by Ford like Lincoln has. Volvo, in most circles, is still considered a legit. luxury brand.
Lincoln just competes with Buick.
I see…so the solution for an American car company is to make a cult Swedish brand its’ luxury nameplate?
jerry weber :
August 27th, 2009 at 12:01 pm
Yes lincoln is renewed. You can buy a Taurus or a lincoln M something or other. You will be told that the V6’s with turbos can perform with the old v8’s. What you won’t be told is that the new Msomething or other and the Tarurus weigh about 4300 pounds right where the frame on body v8 town car is. Some early road tests on the Taurus SHO (which compares with the lincoln,) 16MPG is what the thing averaged. Would the town car be worse? It is not enough to redo a car you have to take it to the next level with efficiency and performance.
Car and Driver recently did a test of $50,000 luxury sedans, and if you look at the results, a MKS turbo would have done quite well, at least from a numbers standpoint. In this class of car (midsize luxury), a curb weight of 4300 lb isn’t ridiculous at all, particularly for a car with AWD. Take a look at this chart and tell me the MKS’ weight is out of line for this class:
http://www.caranddriver.com/var/ezflow_site/storage/original/application/48bab3ae9161e540911db81fb30f6d69.pdf
Based on the same test, 16 mpg for a car with the kind of performance envelope the MKS has is also completely reasonable –
http://www.caranddriver.com/var/ezflow_site/storage/original/application/cae0140b576f6c49c3079f7e58051818.pdf
With 355 hp available, I have no doubt that a MKS turbo would have been EXTREMELY competitive performance-wise in this group – a 0-60 time in the low-to-mid 5 second range puts this car in some very good company. And at $55 grand, it’d have been the cheapest car in this test.
Now, I doubt that the MKS would really be cross-shopped with BMW, but if it can compete numbers-wise with some of the best cars in the world, that would bode well.