Ford has signalled its intention to keep a foothold in the globally buoyant premium car segment by moving away from a possible sale of Volvo.
This year the company had announced a strategic review of the Swedish marque that might have resulted in the sale of Volvo as Ford focused on turning round its loss-making North American operations.
Now, by choice or necessity, Ford is saying it wants to build Volvo's position as a global premium vehicle producer. "Volvo is not for sale," according to Alan Mulally, Ford's president and chief executive.
The move comes as Ford shifts into serious negotiations to sell Jaguar and Land Rover, its two remaining luxury brands.
Ford said it wanted Volvo "to operate on a more stand-alone basis" outside its premium brands group. This group is expected to be disbanded after the carmaker sells the two UK brands by the beginning of next year.
The US company, which does not break out individual results for its overseas brands, also reported an unspecified financial loss at Volvo, and said it planned to disclose the Swedish brand's financial performance beginning with Ford's 2008 results.
Pressed on the reason for shifting gears on Volvo, Mulally spoke of Volvo's "great products", adding that Ford wanted to improve its productivity and cost structure.
Don Leclair, Ford's chief financial officer, mentioned unfavourable exchange rates and sales incentives - driven by intense competition - as factors behind Volvo's quarterly loss.
Like other foreign carmakers, Volvo is under pressure from the weak dollar in the US, its biggest market.
While the weak dollar and US pricing pressures also hit BMW's latest quarterly earnings, Volvo can only be described as underleveraged compared with the German luxury carmaker and other upmarket brands.
General Motors, Ford's Detroit rival, has also failed to produce the kind of performance from its Swedish Saab brand as the best-in-class Germans.
While BMW plans to sell a record 1.4 million vehicles worldwide this year and aspires to sell 1.8 million by 2012, Volvo sold about 428,000 last year, down nearly 4 per cent on 2005.
Ironically, improved performance at Jaguar and Land Rover helped to offset the losses at Volvo and reduce quarterly losses in the US carmaker's Premier Automotive Group to €66.4 million.
Behind the scenes Volvo is even more integrated with Ford's other operations than Jaguar or Land Rover. Several Volvo vehicles share production platforms with other cars built by the Ford, Mazda and Land Rover brands, and Volvo also procures and develops vehicles jointly with them.
Asked about tentative sales talks before Ford's change of tack on a possible Volvo sale, Mulally said: "We certainly could have sold it, but we decided to keep it."