Editions:  Austria · Denmark · France · Germany · Italy · Norway · Spain · Sweden · Switzerland
Advertisement

GM chief proposes Volvo-Saab merger

Share this article

GM chief proposes Volvo-Saab merger
12:06 CET+01:00
Senior General Motors executive Bob Lutz has suggested that a solution to the problems faced by Swedish car firms Volvo and Saab would be to merge them.

"That way both we and Ford get rid of a problem," Lutz told news agency TT in Geneva.

The 77-year-old US car industry legend is in Geneva for an industry exhibition. Swedish news agency TT caught up with him in the airport and he was candid over GM's attitude to the troubled Swedish car-maker.

In its application to the US government for billion dollar loans earmarked to secure GM's own future the firm has confirmed that its financial lifeline to Saab will be cut at the end of the year, at the latest, TT writes.

Lutz confirms that the main objective remains to find a buyer for Saab.

"But I think it will be hard. Buyers also look at the figures. Just like the Swedish government has done. Who wants to buy a firm that has reported losses, year after year," he queries.

Saab is planning to display its new model 9-3 X - basically a tougher variant of the 9-3 - at the Geneva fair.

While Lutz gave a further sign of no confidence in the Saab by confirming to TT that he has no intention of attending the launch, Saab CEO Jan Åke Jonsson is more upbeat about the firm's prospects.

Jonsson claims that there are seven or eight parties which have expressed an interest in buying the firm.

Meanwhile also in Geneva Volvo Cars CEO Stephen Odell has predicted that the car industry will rebound in the autumn and is not interested in rumours of a sale to a Chinese firm.

"I have my hands full running a company," Odell said to TT, dismissing speculation that the firm's leadership were in the Swiss city to canvass for potential suitors.

Odell confirms that the Swedish government has promised to issue 100 percent state guarantees for a loan of five billion kronor ($546 million) from the European Investment Bank (EIB).

Volvo Cars is the first firm to apply for emergency loans from the EIB's 220 billion kronor fund for the crisis hit European car industry.

Swedish enterprise minister Maud Olofsson has said that the Swedish government is not prepared to issue guarantees to support Saab's own loan application from the EIB unless it can be shown that there is a party willing to commit to running the company.

Jan Åke Jonsson confirmed to TT in Geneva however that Saab has been given encouragement by the government to pursue its loan application even before such state guarantees can be made.

Get notified about breaking news on The Local

Share this article

Advertisement
Advertisement
Advertisement
Jobs
Click here to start your job search
Advertisement
Advertisement

Popular articles

Advertisement
Advertisement