Ford Volvo sale likely later this year, Sweden says

Ford Motor Co. is likely to complete the sale of its Volvo Cars unit in the latter part of this year, Swedish Industry Ministry State Secretary Joeran Haegglund said.

Sweden's government is in contacts with Ford, Haegglund said by telephone today, declining to name any suitors for Gothenburg, Sweden-based Volvo Cars. Ford isn't in the same rush to dispose of the unit as General Motors Co. is with its proposed sale of Saab Automobile, Haegglund said.

Ford, the only U.S. automaker to decline taking a federal bailout, and Detroit-based GM are divesting their Swedish units to focus on fewer brands amid the worst recession since the Great Depression. Chinese carmaker Geely Automotive Holdings Ltd. wants to buy a majority of Volvo with an unidentified Swedish investor, possibly including state pension funds, and let Ford keep a stake, Dagens Industri newspaper reported yesterday, without saying where it got the information.

"We're in touch with Ford and note all rumors," Haegglund said. "Ford has a slower pace than GM and Saab and we expect a sale will be completed in the latter part of the year."

Haegglund said it would be "strange" to assume that one of the state pension funds may participate. Sweden's government has said repeatedly since Volvo and Trollhaettan-based Saab have been on the market that it won't buy its domestic carmakers.

Saab vs Volvo

GM is also selling the Opel and Vauxhall brands in Europe, as well as the Hummer and Saturn divisions in the U.S., to shrink operations in an effort to end $88 billion in losses since 2004. Saab's car registrations in Europe dropped 63 percent in June. Volvo's sales in the region fell 14 percent.

Dearborn, Michigan-based Ford said yesterday that it's accelerating model introductions in an effort to boost sales while sharing parts between North American and European models to reduce engineering costs.

"We're right in the middle of the sale process" for Volvo, Ford Chief Financial Officer Lewis Booth said in an interview yesterday, declining to identify bidders or comment on details of the talks. "We're going to continue the sale process."

GM is in talks on selling Saab to Koenigsegg Automotive AB, a sports-car manufacturer with headquarters in the Swedish town of Aengelholm. Talks on disposing of Ruesselsheim, Germany-based Opel will need more time as the U.S. carmaker seeks to resolve "difficulties" with a joint bid from Magna International Inc. and OAO Sberbank, John Smith, GM's chief negotiator, said yesterday.