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GM not hopeful on Saab deal, proceeds with closure
January 6, 2010 / 10:01 PM / 8 years ago

GM not hopeful on Saab deal, proceeds with closure

DETROIT (Reuters) - General Motors Co Chief Executive Ed Whitacre said on Wednesday he is not hopeful a breakthrough deal can be reached to save Saab and said GM is proceeding with the wind-down of the Swedish brand.

<p>Cars travel along an overpass with an advertisement of a Saab vehicle in the background in Budapest December 21, 2009. REUTERS/Laszlo Balogh</p>

Whitacre, speaking to reporters at the company’s headquarters, also said GM’s new chief financial officer Chris Liddell, who has joined from Microsoft Corp, could be a candidate for permanent chief executive of the automaker.

Whitacre, who became acting CEO in December following the departure of Fritz Henderson in a split with the board, said he has yet to receive a list of potential CEO candidates.

“I would say he (Liddell) certainly could be a candidate. It would be up to the board and his performance,” Whitacre said.

Whitacre predicted the No. 1 U.S. automaker will return to profitability this year, after losing $88 billion since 2005 through the first quarter of last year. GM filed for bankruptcy on June 1.

GM is dropping Pontiac, Saturn and Saab and selling Hummer as it restructures to return to profitability after emerging from its U.S. government-funded bankruptcy in July.

He said none of the potential bidders for Saab have come forward with the financing needed to restructure the money-losing automaker.

“I think we’ve done everything humanly possible,” Whitacre said, adding GM will start closing down Saab plants later this week.

Dutch luxury carmaker Spyker Cars is among possible bidders for Saab, but analysts have said the question of how to fund an acquisition of the brand is a major hurdle to a deal. Spyker Chief Executive Victor Muller said last week GM had set a Thursday deadline for bids.

Dropping the 60-year-old Swedish auto brand would eliminate 3,400 jobs in Sweden and hit 1,100 Saab dealers globally.

Separately, Whitacre said GM aims to close a deal to sell the Hummer SUV brand to China’s Tengzhong Heavy Industrial Machinery by the end of January. GM reached a tentative deal with Tengzhong to sell Hummer in June.

In wide-ranging remarks, Whitacre said he expects “hundreds” of U.S. dealers terminated as part of its bankruptcy restructuring to be reinstated. Congress passed a bill in December that gives terminated GM and Chrysler dealers the right to negotiate with the companies to maintain their franchise agreements.

GM, which had about 6,200 U.S. dealers before bankruptcy, is terminating franchise agreements with more than 1,300 dealers through the end of October.

Reporting by Soyoung Kim; Editing by Tim Dobbyn and Matthew Lewis

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