Ford Motor Co has had exploratory talks with China's third-largest car maker, Dongfeng Motor Group, as a potential partner for Volvo, sources told Reuters yesterday.
And Ford also talked to French car maker Renault SA about selling Volvo, but the talks ended quickly due to price differences, sources close to the matter said.
Ford spokesman Mark Truby declined to comment directly but said: "We announced earlier this year that Volvo is not for sale and that we are focused on improving Volvo's business results."
Even though Ford has said it has no plans to sell Volvo, the auto maker has been having informal talks with interested parties, the sources said.
Ford in March said it was developing a plan that would help Volvo operate on "a more stand-alone basis."
Analysts have said that Ford, which lost more than US$15 billion in the past two years and won't return to profits next year, could do with the extra cash.
The car maker has sold Aston Martin, Jaguar and Land Rover, disbanding the Premier Automotive Group, whose only remaining brand is Volvo.
The Michigan-based auto maker is in the middle of a restructuring that includes closing 16 North American plants and slashing tens of thousands of jobs. It mortgaged its assets in 2006 to secure about US$23 billion in financing to help fund its turnaround.
Ford has said the Volvo unit had lost money in 2007 and it wrote down the value of Volvo by US$2.4 billion in January.
Dongfeng has a joint venture with Nissan Motor Co, in which Renault owns a 44-percent stake. The joint venture makes cars for the Chinese mainland market.
Separately, Dongfeng also has a joint venture in the works with Volvo AB, which makes heavy trucks and operates independently of Ford.
The Hubei Province-based auto maker aims to expand its passenger car and light truck lineup, and has its roots in trucks and buses.
(Shanghai Daily July 2, 2008)
