Ford Motor Co. may look to shed its lone remaining European marque, announcing today that it is mulling the sale of its Volvo unit.
The global economic upheaval has the automaker willing to cut Volvo loose, according to Ford CEO Alan Mulally. “Given the unprecedented external challenges facing Ford and the entire industry, it is prudent for Ford to evaluate options for Volvo as we implement our One Ford plan,” Mulally said in a statement. “As we conduct this review, we are committed to making the best decision for both Ford and Volvo going forward.”
As Ford continues the review, Volvo will proceed with scaling back its workforce. Early last month, Ford said it would cut 4,800 jobs, or about 20 percent of its global workforce of 24,300 employees. (The Volvo review began last November.)
Earlier this year, Ford denied rumors that it was putting Volvo on the block. Talks about shedding the Swedish brand became persistent in June, when Ford sold its Jaguar and Land Rover units to India’s Tata Motors for around $2.4 billion.
Back in 1987, Ford got controlling interest in Aston Martin. The automaker went on to purchase Jaguar in 1989 and Volvo in 1999, shelling out $6.4 billion for the brand. Land Rover came into the fold in 2000.
The announcement comes just one day before Ford is due back in Washington, where the Big Three car manufacturers face another round of Congressional hearings on the proposed $25 billion automotive bailout package.
In October, a month during which the U.S. auto industry experienced its worst slump in 25 years, Volvo sales fell 52 percent to 3,717 vehicles. Ford sold 132,838 vehicles last month, down 30 percent from 190,195 cars and trucks it sold in the year-ago period, per the company. Meanwhile, GM sales dropped 45 percent and Chrysler fell 35 percent.