Ford Motor Co said on Monday it was reviewing options for Volvo and could sell the luxury Swedish car brand as it scrambles to shore up cash amid a deep industry downturn. The announcement came a day before Ford and the other two Detroit automakers face a deadline to submit stepped-up restructuring plans to Congress in a bid to win support for a $25 billion rescue package. Ford, which has been shedding assets as it strives to raise cash in recent years, said the review of Volvo was part of its efforts to “strengthen its balance sheet” at a time when auto sales are plunging worldwide. Shares of Ford jumped as much as 12 percent in morning trade, but gave up the gains to trade 23 percent lower as of 2:26 P.M. ET, tracking slides in a broader market and as concerns set in that the loss-making automaker would be a tough sell. “Asset sales in the current environment are very challenging,” said David Allon, a portfolio manager at Firstrust Financial Resources in Philadelphia. “They have to look at all options but if there's going to be a buyer, it's going to be at a fire sale price,” Allon said. Volvo posted a pretax loss of $458 million in the third quarter versus a loss of $167 million a year ago as sales declined 24 percent. Ford burned through $7.7 billion of cash in the third quarter and said last month it would make deeper cost cuts and explore asset sales in a bid to free up $17 billion in liquidity through 2010. Volvo is the last remaining brand from Ford's former premium auto group that had included the now-divested Aston Martin, Jaguar and Land Rover brands. Earlier this year, Ford sold its luxury Jaguar and Land Rover brands to India's Tata Motors Ltd. Ford also agreed to sell about two-thirds of its 33.4 percent stake in Japanese automaker Mazda Motor Corp for around $538 million in November. Reeling from the decline in US auto sales to 25-year lows, Detroit's three ailing automakers - Ford, General Motors Corp and Chrysler LLC - are desperately trying to raise cash to survive the worst economic crisis since the Great Depression. The 3 US automakers are scheduled to submit extensive restructuring plans to Congress on Tuesday as a condition for considering $25 billion loans for the industry.
