GM sells Saab to a Swedish supercar firm

<div>TROUBLED&nbsp;carmaker General Motors (GM) said yesterday it had reached a tentative agreement to sell its loss-making Saab division to Swedish supercar manufacturer Koenigsegg.<br />&nbsp;</div>
<div>The deal will be part-funded by the European Investment Bank (EIB), which is supplying a $600m (&pound;367m) loan, guaranteed by the Swedish government.<br />&nbsp;</div>
<div>&ldquo;Closing this deal represents the best chance for Saab to emerge a stronger company,&rdquo; GM Europe president Carl-Peter Forster said.<br />&nbsp;</div>
<div>Premium carmaker Saab, which has struggled to hold its own against German peers BMW and Mercedes,&nbsp;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.<br />&nbsp;</div>
<div>Saab&rsquo;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 &pound;900,000 each.<br />&nbsp;</div>
<div>But industry experts have questioned whether the high-end manufacturer has the experience to run Saab, which employs 3,400 in Sweden.<br />&nbsp;</div>
<div>&ldquo;Saab has to continue as a mainstream premium brand, but Koenigsegg must ask itself what Saab is for,&rdquo; Spyder Automotive analyst Jay Nagley said. &ldquo;What does it stand for other the fact that it&rsquo;s not a BMW?&rdquo;<br />&nbsp;</div>
<div>Saab produces less than 100,000 vehicles a year, while BMW and Mercedes produce around a million each.<br />&nbsp;</div>
<div>GM&rsquo;s Forster said: &ldquo;This is yet another significant step in the reinvention of GM and its European operations.&rdquo;<br />&nbsp;</div>
<div>Details of the financing have yet to be finalised, and GM declined to say how much was being paid for the unit.&nbsp;<br />&nbsp;</div>
<div>The deal is the latest shake up at GM, as the ailing carmaker seeks to restructure itself.&nbsp;<br />&nbsp;</div>
<div>GM&rsquo;s European arm, which includes Opel in Germany and Vauxhall in the UK, is set to be sold to Canadian car parts supplier Magna.</div>