EoW September 2008

came amid reports that Ford Motor Co, of the US, is actively shopping its Volvo Cars division. Volvo spokeswoman Maria Bohlin told Ward’s that weak North American sales are causing a drain on the company, having declined roughly 10% each year for the last three years. She said that other factors in the cost-cutting decision include the weak US dollar, increases in raw materials prices, and a falling European market. Ward’s data show that, through May, Volvo’s North American sales for 2008 were down 22.0% – to 8,277 units. According to Mr Pope, the Volvo news followed European media reports that Ford is shopping the Swedish brand to raise cash to aid in its own North American turnaround initiative. He cited the online edition of Dagens Industri as saying Ford had contacted an unnamed Chinese company to gauge its interest in Volvo. A Russian investor also is believed to be interested in acquiring the auto maker, the Swedish newspaper said. Mr Pope wrote, “Although rumours that Volvo is in play have circulated since Ford announced last year it was selling its Jaguar Cars and Land Rover divisions, the US auto maker repeatedly has denied it intends to sell the brand. Ford officials have maintained the plan is to position [Volvo] as a major player in the global luxury arena.” Ford spokesman John Gardiner denied that the brand is on the block. “As we said earlier this year, Volvo is not for sale,” he toldWard’s.

Iberdrola SA, of Spain, one of the world’s largest energy companies, ❈ ❈ has said it would invest $2 billion to build hundreds of wind turbines in upstate New York if its bid to purchase the regional power company Energy East (Gloucester, Maine) is approved by New York regulators. The new turbines would more than double state energy production from wind and make New York one of the larger producers of wind power in the US. Iberdrola is one of several foreign-owned energy companies active in the American market, where rising fuel prices and state legislation requiring more energy from renewable sources have made wind, solar, and hydroelectric power increasingly attractive.

Automotive

As Volvo moves to slash its US costs, Ford denies it wants to divest the Swedish brand After posting a $151 million first-quarter loss due to declining US sales, Volvo, the Swedish auto maker, said it would lay off 1,200 workers in its home country. As reported by Byron Pope on WardsAuto.com (25 th June), announcement of the “unfortunate but necessary action”

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EuroWire – September 2008