Volvo to Bolster Truck Division With Money From Ford Deal

PARIS — AB Volvo will use the $6.5 billion Ford will pay for its passenger car division to expand its truck and other commercial products businesses, according to Volvo spokesman Stefan Lorentzson.

“We’re changing the strategy within Volvo and will concentrate on commercial products,” Mr. Lorentzson said. “Scania is one of the acquisitions we would like to make. Besides that . . . there could be other acquisitions, sure.”

Two weeks ago, Volvo paid $650 million for a 12.85% stake in its Swedish rival, Scania, and announced it wants to merge the two companies. Talks with Scania’s largest shareholder, AB Investor, were continuing, according to Lorentzson.

Asked if Volvo plans to use some of its newfound wealth to bolster its U.S. market presence through an acquisition of a truck manufacturer, Lorentzson responded: “They are not excluded. We are looking into possibilities there.”

Under the agreement with Ford, which must still be approved by shareholders and competition regulators, the two companies will share the Volvo nameplate. Ford may use the name for a range of vehicles from passenger cars to light trucks, and Volvo for medium and heavy-duty trucks.

The Ford-Volvo deal was announced Jan. 28.

ccording to a Volvo statement, its interest in a merger or other combination with Scania is an example of one alternative, among others, for participating in the consolidation under way in the truck-making industry.

For the full story on Volvo's plans, see the Feb. 2 print edition of Transport Topics. Subscribe today.