Volvo denies report of U.S. dealer cuts

A spokesman for Volvo Cars of North America on Monday denied reports that Volvo plans to close 30 percent of its U.S. dealerships.

Geno Effler, vice president for public affairs at Volvo’s North American arm, told Automotive News that Volvo is sticking to previous plans to persuade some struggling dealers to voluntarily give up their franchises.

An earlier report by Automotive News' German language affiliate, Automobilwoche, quoted Volvo Germany spokesman Olaf Meidt as saying Volvo plans to close 30 percent of its U.S. dealerships. Automotive News published a translated version of the report on its Web site Friday, July 11, and in print editions Monday.

In April, Volvo’s new North American president, Doug Speck, told Automotive News that Volvo plans to focus on its top 20 markets, which make up just under half of its dealers but 60 to 65 percent of its sales. Volvo operates about 350 U.S. dealerships.

Volvo’s U.S. sales fell to 7,001 vehicles in June, down 26.9 percent from June 2007. For the first half of the year, Volvo sold 46,181 vehicles in the United States, down 14.2 percent from the same period of 2007.

There also has been almost nonstop speculation that Volvo’s parent, Ford Motor Co., might sell the brand. But Ford has said it’s committed to keeping Volvo.

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