GM Cuts off Saab, Says Opel needs $2.3 billion

The New York Times reports that General Motors subsidiary Saab filed for bankruptcy protection in Sweden in this morning. The Swedish car manufacturer is hoping to restructure itself as an independent entity.

Earlier this week General Motors told the treasury department that it had hoped to offload Saab by 2010 as part of G.M.’s restructuring plan.

Saab is G.M.’s worst-selling brand in the United States, selling 21,383 vehicles in 2008, down 34.7 percent from 2007. Its best selling vehicle is the 9-3, of which G.M. sold just over 10,000 cars last year.

By filing for bankruptcy protection Saab is hoping the Swedish government can generate enough financing for Saab so that it can restructure itself into a viable independent entity within three months. Saab, as well as all Swedish auto mobile manufacturers have access to loan guarantees stemming from a support package the Swedish government passed last December.

Meanwhile G.M.’s German subsidiary Opel announced that it would need an additional $2.3 billion from the German government as Opel attempts to restructure itself. Opel is G.M.’s second largest brand behind Chevrolet.

The question now becomes will Saab’s filing for bankruptcy and Opel’s bid to seek an additional $2.3 million effect the Treasury Department’s decision to grant G.M. an additional $9.1 billion in government loans.


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