Sweden Approves Loan Guarantees to Volvo but Not Saab

By Barbara Gay
Barbara Gay
Barbara Gay
February 25, 2009 Updated: October 1, 2015

The chief executive officer of Swedish automaker Volvo, Leif Johansson (L), gives a press conference on February 6, 2009 in Stockholm, to present 2008 financial results.    (Fredrik Sandberg/AFP/Getty Images)
The chief executive officer of Swedish automaker Volvo, Leif Johansson (L), gives a press conference on February 6, 2009 in Stockholm, to present 2008 financial results. (Fredrik Sandberg/AFP/Getty Images)
As with many other automobile industries, the Swedish Volvo and Saab have financial problems.

Volvo PV (Volvo cars) has held continuous discussions with Secretary of State Jöran Hägglund at the Ministry of Enterprise, Energy and Communications and now the Swedish state will most probably approve Volvo PV’s loan application to the European Investment Bank, (EIB), reported Swedish radio on February 23.

Volvo PV’s owner Ford “has given a clear answer that they will take full owner’s responsibility and will guarantee capital flow to Volvo PV until they will find a new owner,” and that is not the case with the owners of Saab, General Motors (GM).

According to Maud Olofsson, minister for Enterprise and Energy and deputy prime minister in Sweden, GM will also have to present a reliable business plan.

Saab has, according to Swedish financial newspaper Dagens Industri, applied for a loan of 500 million euros (US$643.2 million) to the European Investment Bank, which in turn demands national loan guarantees. The Swedish State cannot, however, give any loan guarantees at the moment.

 

Barbara Gay