The rumor mill is really work overtime now, previously it was Dongfeng that was in talks to buy Volvo, but now it is Chery, and Ford have no comment on it:
Ford Motor Co. isn’t commenting on a Chinese business journal report that China’s Chery Automobile Corp. is interested in buying Ford’s Volvo unit.
Caijing Magazine quotes unidentified sources as saying Chery is looking for bank and equity investor help for a possible bid for Volvo, Ford’s Swedish nameplate.
Ford spokesman Mark Truby said Monday the automaker won’t comment on the report.
He says Ford decided last year to concentrate on improving Volvo’s business performance, rather than selling it.
The Associated Press has sought comment from Chery.
Ford shares are up 18 cents, or 4 percent, to $4.60 in midday trading.
Ford’s asking price for Volvo is $6 billion. Chery’s bid was too low and was expected to be turned down anyway.
WHATT!!!
$6 billions for a failed brand, Chery should just say NO! THANKS.
Are you sure you got the right info there ?
> $6 billions for a failed brand, Chery should just say NO! THANKS.
Volvo isn’t a damaged brand like Jaguar was. Beside, Ford heavily depends on Volvo chassis to underpin its large cars and crossovers, so a separation isn’t easy.
> Are you sure you got the right info there ?
Yes, $6 billion.
Land Rover and Jaguar were sold for £1.15 billions but Ford had to pay £600m into the pension fund, and this Volvo is $6 billions, wow.
Well, Ford didn’t even blink eyes with Chery’s $4.3 billion offer, so Ford wants more. Even Chery’s offer confirms that Chery thinks Volvo is worth more than itself, which is valued much less than $4.3 billion.
$6 billion was the asking price Ford passed onto consulting banks when it was looking for buyers of all PAG brands.
But I think it would be a very irrational buyout since Volvo has not made any profits recently at all (and the past ?), why spend so much money gambling on something which a big daddy like Ford cannot even handle.
> why spend so much money gambling on something which a big daddy like Ford cannot even handle.
Ford is not exactly the best managed automotive company in the industry.
I wouldn’t blame Chery for feeling that they could do better than Ford did.
> why spend so much money gambling on something which a big daddy like Ford cannot even handle.
So that Chery can shave 10 years off on the time needed to become a global player. Volvo brings in a ready-made brand, distribution network, and a complete product portfolio into Chery’s fold.
I think Chery is doing pretty fine at home and also abroad in developing markets, so they should be patient and take things slowly, step by step like Toyota, not rushing with all the excessive, loss-making buyouts, and face bankcruptcy in the future.
> I think Chery is doing pretty fine at home and also abroad in developing markets, so they should be patient and take things slowly
Chery management sounds like an impatient bunch.
After all, they were telling everyone how they were gonna sell Cherys in the US via Malcolm Bricklin by January 2007 not long ago, then also tried to sell A3 as US-market ready Hornet to Chrysler. Chrysler, having realized that Chery grossly misrepresented itself about its product development and production capability, then turned around and went to Nissan to get Hornet instead.
> step by step like Toyota
Toyota and Hyundai of yesteryear were well-protected and well-funded by their respective governments, Chery gets none of that and is badly scraping for cash to expand.
But even if Chery successfully buys out Volvo, but after that where is it going to get the money to continue investing in Volvo. So based on that, I’d say this is just a rumour, very groundless, senseless rumour, not true at all.
I do believe this rumor is legit.
Chery made a bid of $4.3 billion on Volvo, and Ford turned it down. End of Story.
> here is it going to get the money to continue investing in Volvo.
That’s not what Chery’s thinking. They are not gonna invest anything into Volvo, but simply move the plant back to China and utilize just Volvo R&D and distribution network in the US and Europe.
Jin Yibo, an assistant to Chery’s chief executive, had ruled out the possibility of buying Volvo
Chery said no to Volvo, see too little gain
http://www.iht.com/articles/2008/07/15/business/deal16.php