General Motors moved closer to
selling a majority stake in Opel, while the deadline for Chrysler to find a
partner entered its final days, and Japan's Toyota kept its top global ranking
even after reporting a 27 percent drop in sales. Separately, No. 1 U.S. automotive
dealership AutoNation posted results that beat Wall Street's estimates but said
its quarterly profit fell nearly 32 percent on continued weak U.S. demand for
Auto parts maker Robert Bosch, the
world's biggest car parts supplier by sales, also said it would slash jobs this
year in Germany and abroad, and rival Continental AG prepared to tighten its
GM faces a June 1 deadline from the
Obama administration to restructure its operations or face bankruptcy. GM needs
to sell a big stake in Opel to get $4.3 billion in loan guarantees from the
German government to rescue its troubled unit.
Italy's Fiat SpA , which reported a
first-quarter loss, reiterated its desire to complete an alliance with Chrysler
LLC, majority owned by Cerberus Capital Management , and emerged with other
parties as a potential buyer for Opel.
Armin Schild, who represents labor
union IG Metall on the Opel supervisory board, told Reuters that Fiat was in
talks with GM to buy a controlling interest in Opel.
Earlier on Thursday, German magazine
Spiegel Online had said that Fiat would sign a letter of intent next Tuesday,
citing people close to the negotiations.
Fiat Chief Executive Sergio
Marchionne said there had not been direct talks with Opel and there was nothing
to announce regarding a deal.
A spokesman for Opel reiterated that
the company was in talks with several interested parties, declining to identify
them. Schild said IG Metall strictly opposed such a deal.
Two sources close to the situation
told Reuters that Fiat and Canadian automotive supplier Magna Steyr were both
interested in taking a stake in Opel unit but a deal was not imminent. Magna
declined to comment.
In its statement on quarterly
results, Fiat said it would keep pursuing its strategy of targeted alliances
while conducting talks with Chrysler.
If Fiat fails to clinch a deal with
Chrysler, some analysts have said it could turn to GM to gain the scale it
needs to survive the worst industry crisis in decades.
But it remains to be seen how it
would finance such a deal because Fiat already faces doubts about its ability
to pay off debt due this year.
GM Chief Executive Fritz Henderson
has said the car maker had reached out to more than six potential
buyers, many of whom were financial investors.
But private equity firms are giving
Opel the cold shoulder, leaving sovereign wealth funds from the Gulf or Asia as
the most interested private investors, managers at buyout firms have told
TIME TICKING DOWN
The U.S. government deadline for
Chrysler to reach an alliance deal with Fiat entered its final week on Thursday
with talks intensifying.
Late Wednesday, sources with direct
knowledge of the discussions said the U.S. Treasury had offered Chrysler
lenders $1.5 billion of first-lien debt and a 5 percent equity stake in a
restructured company in exchange for about $7 billion of debt they now hold.
The Chrysler lending group had
sought $4.5 billion of first-lien debt and a 40 percent stake in the
restructured automaker, sources have said.
Most analysts expect the
Chrysler-Fiat talks to go right down to the deadline. A Fiat spokesman said
that the talks were completely open and the automaker had no
timetable for reaching an agreement.
U.S. dealers planned to meet later
on Thursday with the Obama administration's autos task force to review GM and
Political allies of the two
companies met with senior White House officials on Wednesday where the two
groups exchanged views on bankruptcy and Chrysler's chances for an alliance,
according to a statement from Democratic lawmakers who attended.
In Toronto on Thursday, the Canadian
Auto Workers said it was too soon to know if it will reach a last-minute cost
savings deal with Chrysler, but it was pushing hard to get it done.
In Japan, Toyota Motor Corp
<7203.T> said its group-wide sales fell 27 percent to 1.7 million
vehicles in the first quarter of 2009, but the number still kept it ahead of
Volkswagen AG as the world's top-selling carmaker.
The gap in group-wide sales between
Toyota and Volkswagen shrank to 363,000 vehicles in the January-March quarter
from 840,000 a year earlier.
Volkswagen AG Chief Executive Martin
Winterkorn, meanwhile, hailed cooperation with majority owner Porsche and
reiterated he expected a group profit in 2009 despite a car market slump.
Hyundai Motor Co <005380.KS>,
South Korea's top automaker, reported a smaller-than-expected 43 percent fall
in quarterly net profit as a weak won cushioned it from higher marketing costs
and drop in sales.