Oct. 5 (Bloomberg) -- Ford Motor Co., seeking to sell its money-losing Volvo unit, is negotiating with a U.S.-based bidder for the brand and aims to narrow the talks to one potential buyer this month, said a person familiar with the process.

The U.S. bidder, known as the Crown group, is led by Michael Dingman, a Ford director from 1981 to 2002, son James Dingman and Shamel Rushwin, a former manufacturing and labor executive at the automaker, said the person, who asked not to be identified because the process is private.

Ford, the only major U.S. automaker to avoid bankruptcy, is shedding international luxury lines to focus on its namesake brand as it seeks to become profitable by 2011. Crown, which entered the talks about two months ago, is offering less than the $2 billion bid by Geely Holding Group Co., the person said.

“Volvo is not a damaged brand, it’s a stalled brand,” auto analyst Rebecca Lindland, of IHS Global Insight in Lexington, Massachusetts, said in an interview. “This brand could do really well, but it needs an owner with a very light hand who will let the people who understand Volvo have the authority to grow it.”

Crown is seeking to attract as equity partners former Volvo executives, including Roger Holtback, chief executive officer of the Swedish automaker in the late 1980s, said the person familiar with the process.

4th-Quarter Sale

Ford, which has said it hopes to conclude a sale this quarter, may narrow the field of bidders to one in a couple of weeks, said the person. Geely, China’s biggest private automaker, remains the favorite in the race it entered more than a year ago, the person said.

“We’re talking to interested parties,” said Mark Truby, a spokesman for Dearborn, Michigan-based Ford. “It’s an intensive process and we’re continuing to make progress.” He wouldn’t comment on the Crown bid.

Rushwin, in an e-mail, declined to comment on the matter. Dingman didn’t respond to a message sent through the managing director of the Dingman Center for Entrepreneurship at the University of Maryland.

Ford, which will remain a supplier to Volvo of engines and other components, is attempting to protect its intellectual property in the discussions, said two people familiar with the talks. Still to be resolved is whether Ford or the buyer will be responsible for liabilities such as pensions, the people said.

‘So Many Secrets’

“Ford definitely has to be careful about intellectual property, but that’s tough,” Lindland said. “There are only so many secrets you can keep from your spouse before it starts to hurt the marriage. Realistically, they have to compromise at some level on intellectual property to make the marriage work.”

Ford is seeking about $2 billion for Volvo, less than a third of what it paid for the maker of sedans and station wagons a decade ago, two people familiar with the process have said. Volvo, which Ford put up for sale last December, had a pretax loss of $231 million in the second quarter, compared with a loss of $120 million in the year-earlier period, the automaker said.

Ford rose 21 cents, or 3.1 percent, to $7.05 at 4:15 p.m. in composite trading on the New York Stock Exchange. The shares have more than tripled this year.

The Financial Times earlier reported the Crown bid.

To contact the reporter on this story: Keith Naughton in Southfield, Michigan, at Knaughton3@bloomberg.net

Last Updated: October 5, 2009 16:47 EDT