Ford Motor Co., Fiat S.p.A. and possibly others are poised to take part in what is shaping up as an auction for Volvo Car Corp.
Fiat has confirmed talks with Volvo, and Ford says it is interested. Industry analysts and executives believe that Volkswagen AG is also a candidate.
Fiat is talking to Volvo as well as other automakers about possible alliances, according to Um-berto Agnelli, president of the family holding company that controls Fiat Auto.
'There are talks (with Volvo), but not just with them,' said Agnelli. 'We are speaking with two or three different players. An alliance could be useful, but it isn't essential for Fiat.'
A Volvo spokesman said Fiat is one of several automakers with which the company has discussed an alliance.
He declined to say what stage the talks had reached or if the two groups are discussing a full merger.
VOLVO HIRES J.P. MORGAN
AB Volvo has hired the New York investment bank J.P. Morgan to explore a possible sale of its car division.
On paper, Fiat and Volvo would make a good match. Their products hardly overlap. Fiat is strong in southern Europe and growing fast in emerging markets with low- to medium-priced small cars.
Volvo offers more expensive sedans and is strong in northern Europe. Volvo also is well established in North America, where Fiat has been absent for many years.
'WE CAN'T BE SENTIMENTAL'
AB Volvo Chairman Hakan Frisinger told a Swedish newspaper the company cannot ignore the possibility of new partnerships.
'We can't be sentimental,' he said. 'The task of the board is to see what is best for Volvo, its employees and its shareholders.'
Early this month, Ford told analysts that it has approached Volvo AB about buying all or part of the company, Bloomberg News Service reported.
One of the analysts, David Garrity of GVA Research LLC, quoted a Ford executive saying that Volvo would nicely fill a weakness at the upper end of Ford's product line.
John Lawson, an analyst for Salomon Smith Barney in London, said Volvo would fall neatly between the mainstream Ford brand and Jaguar.
'Volvo would be quite an interesting fit for them,' he said.
Volkswagen is another potential suitor, though chief VW spokesman Klaus Kocks said VW is more interested in buying a truck company than another carmaker.
'We have enough brands; we don't need any more,' he said.
But he did not rule out acquiring Volvo's car operations if a deal involved Volvo's highly profitable commercial truck and bus divisions.
But Kocks said VW would prefer to acquire Scania, the other Swedish heavy truck maker. Volvo Truck Corp. last week bought a share of Scania. (See story below.)
'Volvo's need for cooperation or a partner is in passenger cars,' said Hans Westerberg, an analyst at the Den Danske Bank of Denmark. 'Volvo heavy trucks are No. 2 in the world and more of a swallower than a company to be swallowed.'