DSenstad Posted September 30, 2006 Share Posted September 30, 2006 I think there are a few plants lying around waiting for a new product here in the States if Ford wants to build a Volvo plant. Quote Link to comment Share on other sites More sharing options...
jlsaylor Posted September 30, 2006 Share Posted September 30, 2006 Pardon my focus — my reply concerned only your statement that Volvo was worth 8 billion, and that it could be sold for that kind of coin. As to the rest of your rant, whatever. What Aston has to do with Volvo facing a tougher world of Asian competition and uncertain future developments that might be less than optimal for ROI, is mystifying. It's simple really...if extraordinarily small, and historically volatile, Aston Martin warrants a billion or more in the current market then certainly Volvo is a far better investment in every respect. When taking into account that Volvo is a producer of nearly 1/2 million cars a year while Aston is aspirational in it's climb toward five digit production then Volvo must be worth far, far more than is Aston. For that matter Ford paid 6.5 billion for a less developed Volvo in 1999, which was not a bad deal...the auto analyst firm Trend Tracker recently stated that Volvo would go for at least 7 billion if sold...and the value potential buyers are obviously putting on Aston Martin all stand to dispute your claim. But again...don't let what is going on in the real world distract you. Your argument is busted guy...get over it. Quote Link to comment Share on other sites More sharing options...
Edstock Posted September 30, 2006 Share Posted September 30, 2006 "Aston Martin warrants a billion or more in the current market" How was the bong water? A billion dollars. Considering the ROI, yeah right. Believe what you want to believe, but — AM makes a few millions a year, maybe, that is kinda like a sheltered workshop for hi-tech that has a hard-core following of uber-rich. Without Ford, it is an opportunity to make a small fortune out of a large one. Don't take my word for it, do the ROI yourself. Veeblefetzer starts to look pretty good in comparison. For example, the development costs for the next generation of powerplants will be considerable, especially if Audi's aluminum V-12 turbo-diesel approach becomes adopted by other players at this level. As it stands, the 6.0 V-12 in the AM is starting to get a little long in the tooth, as the Corvette racing competition will attest to, judging by the amount of ballast they've been forced to add. Anybody who buys AM will wait a long time to get their billion out in profits, which is what is the prime determination of share value. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted September 30, 2006 Share Posted September 30, 2006 certainly Volvo is a far better investment in every respect. One aspect deserves scrutiny, in any valuation of Volvo: Every Volvo except the S60 and V70, beginning next year, will be built on a Ford derived platform, and all will be using Ford built/sourced engines and transmissions. The platform sharing problem with Volvo is not that Volvo has donated platforms to Ford NA, but that FoE has donated platforms to Volvo: C30/S40/V50/XC50/C70: C1 S80/XC90: EUCD Volvo's 4, 5, and 6 cylinder engines are, respectively, 2 Duratecs and an I-6 built at Bridgend. Volvo's diesels are Ford/PSA sourced as well. Volvo is, to FoE, what Lincoln should eventually become to Ford NA: a distinctive division, with no unique architectures. THAT is what hampers the valuation of Volvo: The purchaser of Volvo must continue to buy tons of parts through Ford, including engines and transmissions. Quote Link to comment Share on other sites More sharing options...
jlsaylor Posted October 1, 2006 Share Posted October 1, 2006 (edited) "Aston Martin warrants a billion or more in the current market" How was the bong water? A billion dollars. Considering the ROI, yeah right. Believe what you want to believe, but — AM makes a few millions a year, maybe, that is kinda like a sheltered workshop for hi-tech that has a hard-core following of uber-rich. Without Ford, it is an opportunity to make a small fortune out of a large one. Don't take my word for it, do the ROI yourself. Veeblefetzer starts to look pretty good in comparison. For example, the development costs for the next generation of powerplants will be considerable, especially if Audi's aluminum V-12 turbo-diesel approach becomes adopted by other players at this level. As it stands, the 6.0 V-12 in the AM is starting to get a little long in the tooth, as the Corvette racing competition will attest to, judging by the amount of ballast they've been forced to add. Anybody who buys AM will wait a long time to get their billion out in profits, which is what is the prime determination of share value. This is particularly ammusing as Ford is entertaining a billion dollar offer from a consortium, including Astons current head, right now. You can debate worth all you wish, but the fact that several businessmen with the intellectual ability to garner this kind of money actually want to give Ford ~1 billion for the company would seem to trump you. The problem with armchair corporate quarterbacks is they look at listed value of a company and simple ROI estimates and say "well, thats what it's worth" If it was that easy, and it isn't, you could be in Bez Ulrich's position, you can't. And realistically, as different as you claim the times are business is business and all of this should apply to Ford's 2.5 billion dollar acquisition of Jaguar and their 6.5 billion dollar acquisition of Volvo in particular. By the very simple standard you employ Ford was absolutely out of their collective minds to buy Volvo for that amount of money, and yet every business analyst seemed to think it was a decent deal at the time. History says these brands are worth more than you do. A company who places value on auto assets claims these brands are worth more than you do. And finally a consortium of very rich business men all believe that one of these companies is indeed worth more than you do, and has put their money where their collective mouth is. Perhaps you have been kept down by the man all this time since it indeed seems odd that all of these folks in a position to know better than you...don't...at least no according to you. Could there be more to it than you assume? Just keep telling yourself no. Edited October 1, 2006 by jlsaylor Quote Link to comment Share on other sites More sharing options...
jlsaylor Posted October 1, 2006 Share Posted October 1, 2006 One aspect deserves scrutiny, in any valuation of Volvo: Every Volvo except the S60 and V70, beginning next year, will be built on a Ford derived platform, and all will be using Ford built/sourced engines and transmissions. The platform sharing problem with Volvo is not that Volvo has donated platforms to Ford NA, but that FoE has donated platforms to Volvo: C30/S40/V50/XC50/C70: C1 S80/XC90: EUCD Volvo's 4, 5, and 6 cylinder engines are, respectively, 2 Duratecs and an I-6 built at Bridgend. Volvo's diesels are Ford/PSA sourced as well. Volvo is, to FoE, what Lincoln should eventually become to Ford NA: a distinctive division, with no unique architectures. THAT is what hampers the valuation of Volvo: The purchaser of Volvo must continue to buy tons of parts through Ford, including engines and transmissions. I have considered the above as well and I think that upon further inspection all is not quite as it appears on the surface. Very important to consider is the fact that Volvo maintains many factories which only produce Volvo cars and components. No Volvo automobiles currently share an assembly line, or even a manufacturing facility, with a Ford product. Some Volvo engines are asembled alongside Ford powerplants, but Volvo retains an engine facility of it's own which is likely large enough to supply all of Volvo's needs...it would simply need to tool up for the new 6-cylinder (the cost of this must be considered however) As you indicate Volvo does share a large number of platforms with Ford products at this point, but as we have seen with the 500 and Montego it really is not that difficult to take two products on similarly derived platforms in seperate directions...so long as they do not share an assembly line. And in the end I think that is the key that unlocks the answer to this question. Volvo could be sold because it maintains a rather large number of distinct manufacturing facilities. Upon the sale of the same Volvo's C1 chassis would simply evolve differently than would Fords. As for the large number of components any buyer would be forced to purchse from Ford. Volvo outsourced quite a bit before Ford came along, and IMO while there is some difference now in terms of volume outsourced the biggest difference between the two transactions would be that Ford had to deal with several different suppliers while any current purchaser would primarily have to deal with Ford. While there are issues with this it could also be a strong selling point since it could give a purchaser more leverage and Ford more bargaining tools. However, I have to say..... I am no longer as convinced that Volvo is on the table as I once was. This is largely due to changes in where I think Ford is going to position Jaguar and what I think they are going to do, or not, with the Rover name in the short term. Quote Link to comment Share on other sites More sharing options...
Edstock Posted October 1, 2006 Share Posted October 1, 2006 "History says these brands are worth more than you do. A company who places value on auto assets claims these brands are worth more than you do. And finally a consortium of very rich business men all believe that one of these companies is indeed worth more than you do, and has put their money where their collective mouth is." Aw, for what it costs, for what they make out of the cars they build and sell, I sure hope those wizards have plans for the Billion-Dollar Brand (sounds like a Len Deighton novel). Aston-Martin Cologne, Aston-Martin Champers, Aston-Martin luggage (courtesy of Louis Vuitton), Aston-Martin Cognac, Aston-Martin watches, Aston-Martin jewelry, Aston-Martin golf clubs, Aston-Martin skis, Aston-Martin sports clothes. Multi-page insert in the Robb Report: The Bez Buzz. How about: Ultimate Ulrich — Hangin' Out With Yoo-Yoo, on DVD multimedia? Aston-Martin lawn tractors/mowers? Aston-Martin Kitchen appliances? Aston-Martin outboards? Maybe Aston should try to produce a Jaguar-priced sportscar? An XJ-priced sedan? A CUV? A 120" stretch limo? After all, their sleds run from 120 to 250K or so, and the market can take only so many. Gotta promote that brand. Selling Aston is fine by me: Yoo-Yoo and his plutocratic marketing wizards have it all figured out, and Jaguar needs a V-12 option. With Aston-Martin out of the fold, Ford can do this. The 3.5 V-6 becomes a 320hp 7-liter V-12 with some 520hp in mild tune. Quote Link to comment Share on other sites More sharing options...
jlsaylor Posted October 2, 2006 Share Posted October 2, 2006 "History says these brands are worth more than you do. A company who places value on auto assets claims these brands are worth more than you do. And finally a consortium of very rich business men all believe that one of these companies is indeed worth more than you do, and has put their money where their collective mouth is." Aw, for what it costs, for what they make out of the cars they build and sell, I sure hope those wizards have plans for the Billion-Dollar Brand (sounds like a Len Deighton novel). Aston-Martin Cologne, Aston-Martin Champers, Aston-Martin luggage (courtesy of Louis Vuitton), Aston-Martin Cognac, Aston-Martin watches, Aston-Martin jewelry, Aston-Martin golf clubs, Aston-Martin skis, Aston-Martin sports clothes. Multi-page insert in the Robb Report: The Bez Buzz. How about: Ultimate Ulrich — Hangin' Out With Yoo-Yoo, on DVD multimedia? Aston-Martin lawn tractors/mowers? Aston-Martin Kitchen appliances? Aston-Martin outboards? Maybe Aston should try to produce a Jaguar-priced sportscar? An XJ-priced sedan? A CUV? A 120" stretch limo? After all, their sleds run from 120 to 250K or so, and the market can take only so many. Gotta promote that brand. Selling Aston is fine by me: Yoo-Yoo and his plutocratic marketing wizards have it all figured out, and Jaguar needs a V-12 option. With Aston-Martin out of the fold, Ford can do this. The 3.5 V-6 becomes a 320hp 7-liter V-12 with some 520hp in mild tune. Well, I have to say that I agree with the notion that Jaguar desperately needs a V-12..and that the sell of AM facilitates this greatly. Quote Link to comment Share on other sites More sharing options...
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