| Saab abandoned By GM
STOCKHOLM • The future of Sweden's Saab Automobile looks more uncertain than ever after it was abandoned by General Motors and the Swedish government refuses to come to its rescue, despite impending bankruptcy.
Sweden’s centre-right government reiterated today that it has no intention of taking over the beleaguered automaker despite a warning from owner GM that the unit could file for bankruptcy protection “as early as this month” unless it receives Swedish help.
“The Swedish state is not prepared to own car factories,” enterprise and energy minister Maud Olofsson says.“We are not prepared to risk the taxpayers’ money ... This is not a game of Monopoly,” She points out that GM has barely made a profit from Saab in the two decades it has controlled the company..
Olofsson's comments come a day after GM, which bought 50% of Saab in 1990 and acquired the rest 10 years later, issued its ultimatum to the Swedish government as part of a massive restructuring plan for the entire group presented to the U.S. Treasury. GM, which announced late last year that it was looking for a buyer for Saab, says it wants the Swedish automaker to become “an independent business entity effective of Jan. 1, 2010.”
While Sweden’s government flatly rejects the option of taking over the iconic brand, it has said it might be willing to act as a guarantor for a European Investment Bank loan of US$566-million to help keep it afloat.
Saab employs about 4,100 people in Sweden, 3,700 of whom work at its hub in the southwestern town of Trollhattan. According to the unions, some 15,000 jobs in Sweden would be at risk if the automaker were to disappear, since its suppliers would also be hard-hit.
Saab, once renowned for its cutting-edge technology and futuristic designs, has in recent years suffered from an ageing product line and plunging sales. In the fourth quarter last year, the company’s sales nosedived 38% to just 17,900 cars. For all of 2008,it sold only 93,300 vehicles, down from 120,000 just three years earlier.
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