UPDATE 2-Sweden said to eye car loans, Volvo plans fewer cuts

(Adds comments from AB Volvo, Scania)

By Adam Cox and Victoria Klesty

STOCKHOLM, Dec 8 (Reuters) - The Swedish government was
reported on Monday to be planning to offer loans to the nation's
car makers as Volvo Cars, a unit of Ford Motor Co (F.N), said it
would cut nearly 1,400 fewer jobs than originally announced.

Volvo Cars said that following negotiations with unions, it
now was cutting a total of 3,401 jobs worldwide. This compared
with previous plans, detailed in announcements between June and
October, to cut 4,800 jobs.

Swedish daily Dagens Industri, citing an unidentified
source, reported the government planned to offer loans and loan
guarantees worth several billion Swedish crowns to the country's
hard-hit car sector.

"It is not a question of subsidies or of the government
going in as an owner, but of loans and loan guarantees on good
terms," the source said in the report.

A government spokesman declined to comment on the report.

Ford and General Motors (GM.N) have both said they want to
sell their respective Volvo Cars and Saab Automobile units and
have held talks with the Swedish government on what kind of
support it might offer.

The two car makers are important to the wider Swedish
economy not only because of the thousands of workers they
employ directly, but also because of the many companies that
supply the firms.

Meanwhile, Volvo Cars said it had been able to reduce the
number of planned job cuts as a cost-reduction programme had
been successful.

"In parallel with the reorganisation, Volvo Car Corporation
has carried out an efficiency programme in all parts of the
business," it said in a statement.

"These savings have been found in areas such as
renegotiations of contracts, reducing purchased services,
savings in IT, telephony, travel and new routines in the
procurement process."

The firm said further savings will be achieved by
co-locating certain departments and units during 2009.

JOINT RESEARCH

Swedish heavy-duty truck makers AB Volvo (VOLVb.ST) and
Scania (SCVb.ST) said they were in talks with the government on
establishing a jointly owned company with the Nordic country's
car makers to promote research and development of
environmentally friendly vehicle technology.

"Yes, there are discussions, but it is still very early days
... there are no details yet," said Volvo spokesman Marten
Wikforss.

"We are generally positive. But we will have to wait and see
what comes out of it," he added.

AB Volvo's smaller domestic rival Scania said it was also
party to the talks with the government.

"There are talks and they have been going for a week now, I
think. I cannot comment on what is being said," Scania spokesman
Hans-Ake Danielsson said.

"The government is listening and has a constructive dialogue
with the vehicles industry, in a positive spirit."

(Reporting by Adam Cox and Victoria Klesty; Editing by
Sharon Lindores)