Both firms says no jobs will be lost

Ford's purchase of Volvo will underpin the US company's position at the top of the Irish motor market. The combined operation, based on 1998 figures, has more than 13 per cent of annual car and commercial vehicle sales. The companies said yesterday that the deal would mean further growth in the Republic, without the loss of any popular models.

It unclear whether the distribution businesses of the companies here will be merged. However, Ford and Volvo say that regardless of what happens, no jobs will be lost.

Mr Alan Cousins, managing director of Volvo Car Ireland, said the deal was "by no means the end of Volvo" and expressed confidence Ford would retain all the Volvo models.

"The range is very highly regarded and I would be very surprised if Ford decided to end any of them," he said. The level of investment needed for future developments was beyond Volvo "as a 1 per cent player", he added. He said the main impact of the deal would be in the area of research and development, which would probably take place on a joint basis from now on.

He declined to comment on whether the two companies will operate a common distribution business.

"That will not be decided for some time," he said.

A spokeswoman for Ford Ireland said dealerships are likely to remain separate - as was the case when Ford acquired Jaguar several years ago. Mr Cousins agreed but said current arrangements would be reviewed "as a matter of course".

The Ford spokeswoman added that the only Ford models directly in competition with the Volvo range were the new Focus, the MPV Galaxy and possibly the Explorer, an off-the-road vehicle.

The companies said Jaguar does not compete directly with Volvo and only has 0.1 per cent of the market.

Ford had 12.2 per cent of the new car (16,327) and commercial vehicles (5,351) market last year, while Volvo held 1 per cent. The new company with 13.2 per cent of the market has a 1.5 percentage point lead in terms of market share over its nearest competitor Toyota which sold 16,824 cars and 3,907 commercial vehicles.