GM sells Saab to a Swedish supercar firm

TROUBLED carmaker General Motors (GM) said yesterday it had reached a tentative agreement to sell its loss-making Saab division to Swedish supercar manufacturer Koenigsegg.
 

The deal will be part-funded by the European Investment Bank (EIB), which is supplying a $600m (£367m) loan, guaranteed by the Swedish government.
 

“Closing this deal represents the best chance for Saab to emerge a stronger company,” GM Europe president Carl-Peter Forster said.
 

Premium carmaker Saab, which has struggled to hold its own against German peers BMW and Mercedes, began restructuring in February, four months before GM filed for Chapter 11 on 1 June. GM currently has bankruptcy protection in the US and is slimming down its range of brands as it tries to regain profitability.
 

Saab’s sale to Koenigsegg, which produces 18 cars a year and employs 45 people, is expected to close by the end of the third quarter. Koenigsegg sells its supercars for around £900,000 each.
 

But industry experts have questioned whether the high-end manufacturer has the experience to run Saab, which employs 3,400 in Sweden.
 

“Saab has to continue as a mainstream premium brand, but Koenigsegg must ask itself what Saab is for,” Spyder Automotive analyst Jay Nagley said. “What does it stand for other the fact that it’s not a BMW?”
 

Saab produces less than 100,000 vehicles a year, while BMW and Mercedes produce around a million each.
 

GM’s Forster said: “This is yet another significant step in the reinvention of GM and its European operations.”
 

Details of the financing have yet to be finalised, and GM declined to say how much was being paid for the unit. 
 

The deal is the latest shake up at GM, as the ailing carmaker seeks to restructure itself. 
 

GM’s European arm, which includes Opel in Germany and Vauxhall in the UK, is set to be sold to Canadian car parts supplier Magna.