| After dispatching the ultra-luxury brand Aston Martin | | | | Martin earlier this year. Among the interested buyers of |
| earlier this year and auctioning off Jaguar and Land | | | | the two British luxury brands is Indian automaker Tata. |
| Rover, Ford is now looking to sell the Swedish brand | | | | Tata Motors is the largest Indian automaker and it is |
| Volvo according to The Financial Times. According to | | | | currently getting a lot of attention after carmaker after |
| reports, Ford’s Chief Executive Officer Lana Mulally | | | | carmaker expressed their entry in the growing Indian |
| may be looking to sell the luxury brand. | | | | auto market. After announcing that they will be |
| Although Mulally, and Ford for that matter, is yet to | | | | introducing a $3,000 compact car in India, Tata Motors |
| divulge information concerning the issue, there are a lot | | | | may be looking to diversify its offering as it is reported |
| of opinions floating in the auto industry as to why Ford | | | | that the company is willing to bid about $1.3 billion for |
| should sell the Swedish brand which it acquired in 1999. | | | | the two British brands. |
| Rod Lache of the Deutsche Bank in an interview with | | | | When asked about the issue, a Tata Motors |
| The Financial Times pointed out two reasons why | | | | spokesperson has this to say: “We have absolutely |
| Ford is better off without Volvo. | | | | no comments to make on mergers and |
| The first reason is that once Ford has sold Volvo, it | | | | acquisitions.” It is reported that Tata Motors has |
| can simplify its operating structure. It can be | | | | signed a confidentiality agreement and is already |
| remembered that Ford announced earlier this year that | | | | having talks with the Dearborn-based automaker. |
| they will be focusing on their core operations as part | | | | This development has received wide interest from |
| of their turnaround plan. With Volvo in Ford’s folds, | | | | analysts. Abdul Majed, an auto industry analyst for |
| the Dearborn-based automaker will be spending both | | | | Price Waterhouse, says that Tata Motors aiming to |
| money and effort in synching Volvo’s operation | | | | buy Jaguar and Land Rover makes perfect sense. |
| with other marques. | | | | “For an Indian auto firm buying into an American or |
| The second reason pointed out by Mr. Lache is that | | | | European auto company makes perfect sense as it |
| Ford’s coffers will be boosted by the sale of the | | | | can then leverage the brand, the product development |
| Swedish auto brand. This money can go to their | | | | capability and distribution platform and get access to |
| healthcare liabilities and in their contract talks with the | | | | international markets,” said the analyst. |
| United Auto Workers (UAW). | | | | Although buying luxury brands makes sense, Abdul |
| Although Volvo has been integrated into Ford’s | | | | Majed pointed out that Tata Motors should only go for |
| core operations to some point, it would be a sacrifice | | | | Land Rover since Jaguar has been a money-loosing |
| that Ford needs to take in order to swiftly turn the | | | | firm for years. This though might not be possible since |
| company back to profitability. After all, the company | | | | Ford has almost joined Jaguar and Land Rover by |
| has already closed down assembly facilities which | | | | integrating operations of the two brands together. In |
| assemble Ford engines and other components | | | | fact, Jaguar and Land Rover vehicles are |
| including Ford bumpers and the like. | | | | manufactured in the same assembly facility and that is |
| Meanwhile, Ford is seriously pushing through with its | | | | one strong reason why Ford is selling the two as a |
| plan to sell Jaguar and Land Rover, an action that has | | | | package. |
| been anticipated by many since Ford sold Aston | | | | |