Monday, 15 June 2009

AUTO HEADLINES

Fiat could still take the driving seat at GM

The deal to sell the European arm of General Motors faces the risk of collapse, thereby opening the door once again for Fiat.

Insiders have hinted at a ‘cooling’ towards GM’s preferred bidder, Canadian car parts firm, Magna International.

It means weeks of more uncertainty for 5,000 British workers at Vauxhall, which is owned by GM.

Officials in Germany, where the bulk of GM’s European operations are based, have revealed that the door remains open for Fiat, which was once thought to be in the driving seat to acquire GM Europe, and for Chinese companies.

German Economy Minister Karl-Theodor zu Guttenberg says his officials were still talking to potential investors in Vauxhall and Opel which have not yet been made public.

He said: “We are still in contact with other investors.” It is understood that China’s fifth largest carmaker, BAIC, is in the running alongside Fiat and another unnamed Chinese investor.

UK Government officials are due to meet Magna executives in London next week. (National newspapers: June 12).

Swedish sports car group poised to buy Saab

Koenigsegg, the Swedish producer of supercars, is set to buy Saab, General Motors’ up-for-sale Swedish-based company.

GM is expected to shortly announce that it is in exclusive sales talks with the company and its allied Norwegian investors. The deal is likely to be closed by early summer.

The development would mark bankrupt GM’s third move to dispose of a car brand in less than a fortnight, part of its plan to focus on four core brands. It follows last week’s announcement of the sale of Hummer to China’s Sichuan Tengzhong Heavy Industrial Machinery and of Saturn to Penske Automotive Group, the dealership chain.

The decision follows talks this week between the three shortlisted bidders and GM at its European headquarters in Zurich.

Koenigsegg ‘has the best overall offer’, a person close to the deal said. Further details were not immediately available.

The privately owned company, based near Malmo, sold 18 cars last year and is said to be interested in applying its knowledge of niche models to a higher-volume carmaker.

Koenigsegg beat bids from Renco, US investor Ira Rennert’s holding company that bought and turned round the maker of Humvee, and Merbanco, a group of private investors in Wyoming. (FT.com: June 12).