20 May 2008

Ford is to cut production at Volvo as a way of reducing its costs and losses from the troubled Swedish brand, says a report in today's Wall Street Journal.

 

The WSJ says the reduction could affect up to a third of the workers at one of Volvo's two European factories. Yesterday Volvo's chief executive Fredrik Arp told a local newspaper in Gothenburg that the company could lay off up to 700 workers by cutting a shift from the Torslanda plant there.

 

Volvo has emerged in recent months as one of Ford's bigger problems, with the division sliding into losses for 2007.

 

No official announcement has been made about whether Ford wants to dispose of Volvo as it has now done with the Jaguar and Land Rover companies that were also formerly in the Premier Automotive Group.

 

But group chief executive Alan Mulally is reported by the WSJ as having told senior Ford executives that he wants eventually to find a buyer.