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Ford Offers 1st Official Comment, Confirms Geely As Preferential Bidder

Posted in auto industry, Ford, Newsworthy by Suzanne Denbow | October 28th, 2009 | Leave a Reply |

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The painful Volvo/Geely saga continues this morning with news from the Ford camp indicating that despite the mysterious emergence of the Crown consortium, Geely is still Ford’s preferred bidder in the race to screw unload Volvo.

According to Ford, despite their concerns expressed earlier this month regarding the disclosure of intellectual property rights, they’re committed to forging ahead with Geely’s proposition. “Ford’s objective in our discussions with Geely is to secure an agreement that is in the best interests of all the parties,” said Lewis Booth, Ford Motor Company executive vice president and chief financial officer. “Any prospective sale would have to ensure that Volvo has the resources, including the capital investment, necessary to further strengthen the business and build its global franchise, while enabling Ford to continue to focus on and implement our core ONE Ford strategy.”

To the amateur industry analyst, this basically means that Ford wants to have their cake and eat it too. While Volvo might have devolved into a significant financial burden over the years, Ford has successfully capitalized on Volvo’s engineering prowess and owes no small amount of their current success to the collaborative effort between their Swedish subsidiary. Geely’s bid might be attractive, but the potential for this deal to backfire on Ford maybe 5, 10 years down the road is very, very strong.

“Ford believes Geely has the potential to be a responsible future owner of Volvo and to take the business forward while preserving its core values and the independence of the Swedish brand,” continued Booth, “but there is much work that needs to be completed in the more substantive discussions that are agreed to take place. We have no specific timeline to conclude the discussions.”

Source: Ford

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