BMW: we'd like to buy Volvo

News

2 mins read

9 May 2007

BMW seriously considered launching a takeover bid for Volvo earlier this year, Autocar can reveal.The Bavarian car maker requested a complete breakdown of Volvo’s financial position from a European investment bank, which is handling enquiries on behalf of Volvo’s owners Ford.Sources also revealed that BMW had earlier looked at Alfa Romeo as a possible takeover target.Industry experts have told Autocar that BMW is considering expanding its range of brands to aid the company’s future growth as well as underpinning its front-wheel-drive Mini division by greatly expanding its output.It’s thought some company bosses saw Volvo as a global brand complimentary to BMW that still has considerable scope for growth. While BMW will always emphasise driving pleasure, Volvo would add safety and environmental concerns to the mix.Although BMW’s outline plan isn’t known, it’s likely that the larger saloon and estate models would have eventually switched to BMW platforms offering both rear- and four-wheel drive.The smaller cars in Volvo’s range would have remained front-drive and would probably been merged with an enlarged Mini family.In fact, it is the future of the Mini brand that is causing BMW a considerable headache. It has been forced to make major investments by redesigning the new Mini, as well as engineering the Mini Clubman estate.Mini sales are still down on their 2005 peak, and BMW insiders acknowledge that a total annual output of 250,000 to 270,000 cars is not enough to secure a profitable long-term future for the Mini brand.Potentially, BMW could have built its proposed large five-door Mini and Mini SUV on the same front-drive chassis as a future S40 and V50.An annual output of 500,000 upmarket Volvo and Mini front-drive cars would have ensured long-term profitabilityThe news that BMW is again seriously considering a buy-out of a major car maker will come as shock to the industry.Seven years ago BMW was humiliated when massive losses forced it to break up and sell off the Rover Group, which it had bought back in 1994.