In a move that appears to favor Volvo over Saab – or at least Volvo’s Ford ownership over Saab’s General Motors ownership – news comes out of Sweden that the local government is set to guarantee a loan for Volvo Cars. Ford has been attempting to divest itself of Volvo, but in the interim, the Dearborn, Michigan, automaker says it needs 5 billion kronor ($573 million).
Joran Hagglund, Sweden’s Industry Ministry state secretary, said that the government is preparing to approve an application that would be filed at the European Investment Bank next month, according to Dagens Industri.
Hagglund was quoted as saying that the government would guarantee 90 percent of the loan, leaving the additional 10 percent up to outside investors.
Obviously, the move favors Volvo to Saab, another American-owned Swedish brand that has been requesting loans from the government.
“Unlike GM, Ford has clearly stated they will take full ownership responsibility and guarantee capital flows to Volvo Cars until they have found a new owner for Volvo Cars,” Hagglund told Dagens Industri.
Still, the move hardly guarantees Volvo’s future. Many analysts have said that, despite Saab’s close integration into the GM portfolio, the brand’s smaller size might make it more accessible to outside investors.



02/24, 10:02 AM
posted by:
cire_1wb
I don’t blame the Swedish government for favoring Volvo. Ford has done a better job of supporting the brand than GM has done with Saab.
02/24, 10:24 AM
posted by:
Borat
From point of view of Swedes working for SAAB, it is discrimination.
02/24, 10:43 AM
posted by:
E90
Ouch!! The Swedish gov’t must be reading Need More Oil For GMs blog!!
02/24, 10:54 AM
posted by:
miket
Discrimination? Its plain business. GM has treated Saab like garbage for years and already declared bankruptcy.
Lemme see….which business should I invest in if I want at least a glimmering hope of getting my investment back? Is it the abandoned bankrupt one, or the one with owners that will see a sale through?
02/24, 10:55 AM
posted by:
idrinorbarsaku
If i was Sweden, i would bank my money on VOLVO too! Saab is no where near volvos level imo.
02/24, 10:56 AM
posted by:
golfcar
$573 Billion – that is almost as big as the incentive program for the US. Should be $573 million.
In my opinion Volvo is worth saving. Ford took the good from Volvo and let them do what they do best. GM ruined Saab.
02/24, 10:57 AM
posted by:
Tritonpower5.4
Yeah Ford has treated Volvo much better than GM treated Saab. Saab’s were just rebadged GM products and Volvo’s were actually nice lookin automobiles with their own personality. I dont blame the Swedish government for supporting Volvo in all of this.
02/24, 11:12 AM
posted by:
A4
yeah i think your exchange rates are a bit off, LLN.
02/24, 11:17 AM
posted by:
idrinorbarsaku
haha that funny, i just picked up on the 573 billion, i automatically read it as 573 million. LLN really needs to proof read this sh!t
02/24, 11:24 AM
posted by:
02WRXPSM
SAAB has their military engines/jet fighter contracts to fall back on, they can exit the auto business and still do just fine as a military contractor.
02/24, 11:30 AM
posted by:
johnnycanuck
Volvo must die. All Volvos should immediately be taken off the road and turned into playground equipment for special needs children. All Volvo drivers should be forced to submit to experimental brain surgery to remove the part that tells them to be in the left lane at any time.
02/24, 12:02 PM
posted by:
Tritonpower5.4
^^^^Freak^^^^
02/24, 12:24 PM
posted by:
global_lightning
Johnnycanuck:
As a Volvo driver, just for you I will today make an extra effort to drive in the left lane 5 MPH below the speed limit AND leave my right blinker going.
02/24, 12:26 PM
posted by:
global_lightning
02WRXPSM:
SAAB Aerospace and SAAB Automotive have been two separate companies since the 1990’s. That whole ‘Born From Jets’ line is pure marketing.
02/24, 12:31 PM
posted by:
johnnycanuck
global, at least you know I’m just being facetious, but I’m more of the opinion that Ford’s just as guilty of raping Volvo for what they want as GM is of raping Saab. I defy anyone to say either brand has even half the personality now than the day they were taken over.
02/24, 12:34 PM
posted by:
hummah
Saabs are mostly built on GM platforms, so a 9-5 is like a $45K Vectra and a 9-7X is like a $50K Trailblazer- it’s a complete waste of money for an inferior product. Volvo and Ford don’t share platforms nearly as much, so Volvo is more like its own company. In fact, the new Taurus uses a modified Volvo S60 chassis, so a Taurus is like a $25K Volvo.
02/24, 1:05 PM
posted by:
miket
I would say Volvo has double the personality they had before Ford took over. Their cars have a style which they definitely did not have before Ford ownership. Ford left them alone to keep using their 5cyl engines. Even the V8 that the s80 uses is sourced from Yamaha. They took technology they needed, provided some cost cutting by sharing some platforms but Volvo kept their identity.
02/24, 1:16 PM
posted by:
TomF
Ford is guilty of cheapening Volvo products and making them more ordinary in an attempt to double US sales volume. Remember than ten years ago (1998-99) there was no Volvo SUV, no Volvo 30- or 40- series, no C70… the lineup was dead simple, dull, and durable: S60, V70, V70XC, and the last of the RWD barges. That was it. Supply in the US was well-matched with demand. There wasn’t much discounting off the sticker (unless you did European delivery). Screaming drive-off lease deals, such as you see advertised today, were unheard of. The cars were expensive but people believed in them. Volvo was making money.
Today Volvo US markets a huge mess of indifferently built, way overpriced, unsuccessful models and the buying public is rejecting them in spades (and not just because of the economy; Audi had a pretty good 2008, but Volvo sales totally cratered). My family’s independent Volvo mechanic forbids his friends to consider a post-2000 Volvo because of the cr*p ingredient parts and the cost of upkeep.
All this goes to support johnnycanuck’s post above. GM may have ravaged Saab to the point where it’s totally unsalvageable. But Ford pi**ed away a hell of a lot of Volvo cachet, brand equity, quality and value over these past ten years, and ought to answer / pay for it. In short, $573 billion (heh heh) seems like a lot for Ford to ask, given the damage it’s done to Sweden’s most prestigious export brand.
02/24, 1:24 PM
posted by:
oldraven
Vovo and FoMoCo don’t share platforms? I beg to differ.
Let’s look at the platform lineup for Volvo.
XC90, S60, S80, V70, XC70 (FoMoCo D3 or D2 as Volvo calls it.) Shared with Taurus, Sable, MKS, Five Hundred, Montego, and Freestyle.
XC60, S80 (EUCD(F)/P2(V)) Shared with Mondeo, Freelander/LR2, Galaxy, and S-max.
S40, V50, C70, C30 (C1(F)/P1(V)) Shared with Focus C-max, Focus, 3, 5, and Kuga.
Well, that’s everything they have for sale now and for the last few years. Not one car built on a dedicated Volvo platform. They don’t have unique engines, transmissions, or AWD systems. They are just as integrated into FoMoCo as Saab is into GM.
02/24, 1:25 PM
posted by:
Borat
MikeT, what style Volvo acquired under Ford ownership? All of their cars are the same as they were 15 years ago (before rape and pillage). The only new shape is C30 (in 15 years. What so different between V70 and X90? One is a bit taller and twice heavier with the same engine? And if we to live in Europe we could buy Fords with Volvo stuffing for less coin. FYI, 5 cylinder in Volvo is sourced from VW group and Volvo own design is I6. BTW, Volvo historically co-developed engines: V6 was co-developed with Renault and Ford in 60’s.
02/24, 1:36 PM
posted by:
miket
I didn’t know that the T5 was a VW design….
Since Ford purchased Volvo, the “ugly box” designs that Volvo was known for were shed, making them (at least to me) appealing designs for a fairly basic sedan. Their interiors are well executed as well. Much more so then older volvos. I wouldn’t put them up against Audi, but they are very well done.
When you look at a volvo, you know pretty much what to expect. It does not matter if you are a fan of Volvo, but you can’t really argue that they don’t still have a unique identity, even today. You can’t say that for the Saabs out there. At least when Volvo does some platform sharing, they put their own spin on it, not just sheetmetal.
02/24, 1:51 PM
posted by:
Zcarsales
Guys! Its Volvo. I never knew that this much trouble or interest can be derived from Volvo. However, there is no other car I’d accidently run into a moose with.
02/24, 1:54 PM
posted by:
angelo
I don’t think that the Volvo T5 is related to any VW engine. The VW 5-cylinders are way more modern and economical.
02/24, 3:25 PM
posted by:
1c3d0g
Still guys, to be fair, Volvo is in a much better shape than Saab, so I can see why the Swedish Government would want to place their bets on the “safest” option.
02/24, 4:46 PM
posted by:
Borat
Tom, you said well!
02/24, 4:49 PM
posted by:
Borat
angelo, the engine was sourced 15 years ago (give or take) and updated (or not) internally. Obviously VW was running on its own schedule with the same engine. That is why they are different today. I am not sure that VW motor is more economical, but it is different.
02/24, 8:06 PM
posted by:
Ring-Taxi
Great move for the Swedes. Volvo has always been the dominant of the two brands. Saab has an edge in Aerospace but then again Volvo is usually the supplier for the jet engines.