Friday, February 6, 2009

RENAULT AND FORD BACK IN TALKS ABOUT VOLVO SALE?



    A report doing the rounds claims that Renault is again talking to Ford about possibly buying the blue oval’s Euro-based premium brand Volvo Cars. Last year the two companies began discussions on this issue but nothing came of them. It was said Ford was asking too much for Renault CEO Carlos Ghosn’s liking. Now the negotiations are back on track. Mr Ghosn is known for his uncompromising approach to business. Four years ago he was talking to General Motors about a possible merger. The guys at GM thought it would be a merger of equals between Renault, Nissan and them but Ghosn is said to have wanted total control of the entire business. GM backed off.



    Volvo Cars on the other hand was sold to Ford way back in 1999. It became part of the Premier Automotive Group which consisted of Land Rover, Volvo, Lincoln, Aston Martin and Jaguar. Aston Martin has since been sold to a consortium in Britain while Tata Motors bought both Jaguar and Land Rover for US$2.3 billion (R22.7 billion in today’s money).



    Renault could use a premium brand like Volvo in its stable. Nissan’s Infiniti is still very small compared to Toyota’s Lexus and some markets like South Africa don’t even plan to introduce the Infiniti brand, therefore limiting its future growth potential.

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