Changan Auto in talks with Ford to buy Volvo

Shanghai, December 9 (Gasgoo.com) The top executives of Changan Auto, Ford and Volvo are in talks over Changan's buying of Volvo, reported National Business Daily today, citing an insider from the Chinese automaker.

At first, during the 2008 Guangzhou auto show last month, Volvo's top executives had long talks with Changan Auto president Xu Liuping, and this has been confirmed by a PR official of Changan Auto, said the report. "There is any possibility," Liu was quoted as saying.

And then recently when Ford Motor announced its plan to adjust its Volvo strategy, the presidents of Ford Asia Pacific, Ford China, Volvo China met Changan's president in Chongqing, where Changan Auto is headquartered, and they had closed-door talks. It seems that Ford's announcement of the new strategy is closely related to Changan's intention of buying Volvo, said the business newspaper.

The insider added that it is logical for financially troubled Ford Motor to consider Changan as a possible Chinese partner of its Volvo brand, because they have the Changan Ford Mazda joint venture which is also producing the Volvo S40 and S80 models. Volvo China's top executive has declined to comment on this matter, said the report.

In another development, the UK's Sunday Mail reported yesterday that Ford has returned to Shanghai Automotive Industry Corp. (SAIC) to make another pitch to sell Volvo to the biggest Chinese automaker.

"The urgent deal between SAIC and Ford also explains the suave reaction of Changan, Ford's joint venture partner in China. If the deal is consummated, Changan could sell their Ford operation to SAIC, or SAIC could swallow the whole Changan kit and caboodle," said a news blog ("Confirmed: Ford Wants To Sell Volvo To China Real Fast") by Bertel Schmitt at www.thetruthaboutcars.com on December 8.