STOCKHOLM/WIESBADEN - General Motors was grappling with the future of two European units on Wednesday, seeking options for Saab after a sale collapsed and preparing to show unions its Opel restructuring plan.
The U.S. automaker, which emerged from bankruptcy in July after falling victim to a worldwide auto crisis, had been seeking to sell the two loss-making units. Some analysts say the European market that they operate in is burdened with as much as 20 percent too much production capacity.
But on Tuesday GM's deal to sell its Swedish unit Saab to niche luxury carmaker Koenigsegg, backed by China's BAIC, collapsed after the buyer walked away.
That follows controversy earlier this month when GM backtracked on months of talks to sell a majority stake in Opel to a consortium led by Canada's Magna International, deciding instead to keep Opel and restructure the business itself.
SAAB'S UNCERTAIN FUTURE
Trolhattan, Sweden-based Saab, which has not made a profit since 2001, was facing uncertainty on Wednesday. Joran Hagglund, state secretary at Sweden's Industry Ministry, said GM appeared to still harbor hope of being able to sell Saab.
The Swedish government had effectively ruled out a state bailout of the 60-year-old auto brand, saying on Tuesday that a private buyer was the only option for Saab.
GM's board has a regular monthly meeting scheduled next week, and the question of what to do with Saab will now lead the agenda, a person with direct knowledge of the situation said on Tuesday.
No other bidders have so far emerged for the brand, meaning GM's only options would be to restart the sale process or to wind down the business, the more likely option, the person said.
BAIC, which had been part of the Koenigsegg-led consortium negotiating for Saab, said it was studying its options and reiterated its commitment to become more international. Analysts said it was unlikely to bid for the whole of Saab alone, but might buy some of the assets.
OPEL REVAMP PLAN
GM was due on Wednesday to present Opel labor leaders with the restructuring plan it hopes will get the struggling unit back on track.
Acting GM Europe head Nick Reilly said earlier this week that the group would cut between 9,000 and 9,500 jobs out of the 50,000 strong workforce at Opel and British sister brand Vauxhall as part of the 3.3 billion euro ($4.92 billion) plan.
Meeting state premiers on Tuesday at Opel's Ruesselsheim headquarters, Reilly sought to reassure German workers -- which make up around half of Opel's headcount.
We have transferred our European headquarters to Ruesselsheim. That shows how important this site will be for us in future, he told reporters after meeting Hesse state premier Roland Koch. He added that Opel's Eisenbach plant was also very important.
Reilly said GM had not yet received any binding commitments for state aid. Opel had had pledges of state support from countries and regions with production sites when it was due to be sold to Magna.
(Reporting by Johan Sennero, Nick Vinocur, Simon Johnson, Angelika Gruber and Doug Young; Writing by Helen Massy-Beresford; Editing by Erica Billingham)