Speaking with BusinessWeek, Credit Suisse analyst Koji Endo told reporters that Ford will have no choice but to sell its 33.9% stake in Mazda “if things get worse” for the Blue Oval. However, Endo warns that a separation may still allow both companies to continue sharing platforms and components but that it would also leave Mazda open to a takeover from another buyer.
Another reason that stands in the way of Ford selling Mazda is the added profits the Japanese carmaker adds to Ford’s bottom line. Ford’s 33.9% stake is worth roughly $2.5 billion but Mazda is expected to return up to $750 million in earnings this year alone – one of the worst years on record for the auto industry. Mazda is also predicting sales of 1.48 million vehicles this year, up 9% on 2007 levels.
While the chance of Ford selling Mazda is slim, a sale of its Volvo subsidiary is much more likely. The Swedish carmaker, like Ford, is dealing with a massive restructuring program, cutting thousands of jobs and still recovering from a first quarter loss of $151 million. Furthermore, there have been a number of reports over the past several months suggesting that Volvo could be sold to a Chinese carmaker, however, Ford officials have continued to deny those rumors.
