Volvo will remain under Ford’s shadow

Originally Sweden based automaker Volvo Cars is now not included in the “one Ford” business models or the brands Ford Motor Co. is selling. The announcement was made by Volvo Cars Chief Executive Frederick Arp. Volvo will remain a property of Ford, as its remaining brand in the Premiere Automotive Group. Ford is loosing its premium brands, what do we expect for a company who’s been really struggling for a long time. And I’d like to say that Ford’s brands are not that bad, like the Acura CL head gasket, many buyers are really interested.

“We’ll continue to extract synergies in component sharing and commodity sharing and continue to seek scale of economies in technology selection and development of new technologies,” Arp tells Ward’sautos.com.
“But when it comes to something that is really linked to the DNA of Volvo and going more premium, that is something we will do on our own.”

The stability status of Volvo in Ford’s Blue Oval was defined when last month, Ford CEO Allan Mullaly confirmed that they are not selling the Volvo nameplate. In fact, Mullaly said that they are venturing ways to strengthen Volvo’s stand in the global auto market. Volvo is the only brand left in the PAG after Ford sold the Aston Martin and announced the plan of selling Jaguar and Land Rover.

“We think we will be, and already are, a good premium manufacturer and brand, but don’t aspire to be luxury in the sense we will be up there competing with the Bentleys,” Arp says. “Our key competitors are BMW, Audi, Mercedes-Benz and Lexus (brands).”

The CEO emphasized the 2008 Volvo V70, a new vehicle proving that their vehicles have undergone great improvements. Arp described the sports wagon as a “significant step forward in terms of luxury our premium-ness”.
Although very optimistic, Arp admitted that his brand is also facing some challenges including the continuous depreciation of the dollar. However, he said that pricing pressure also benefits the consumers and automakers as well.

“In this country right now, cars are under-priced vs. the rest of the world,” he says. “The dollar has basically declined by 30%-70% the last two years, and (there has) been no adjustment in pricing for that.”

“We work very hard to ensure that for every new nameplate we launch, or revised product we launch, we have a world first or something that is really important to our customers in terms of safety,” Arp says. “(Safety) continues to be the leading edge for our company.”