Sweden will come to the rescue of its US-owned carmakers crippled by the financial crisis, Saab and Volvo, to secure the future of an automobile industry that accounts for 15 percent of exports, officials say.
“Of course the Swedish government is committed to supporting the carmakers. We can guarantee that we will have car manufacturing in Sweden because it is an important part of our economy,” said Frank Nilsson, a spokesman for the Enterprise and Energy Ministry.
Volvo Cars’ owner, US giant Ford, said on Monday it was considering selling the marque given the challenges facing the US auto sector, clouding the future for the Swedish brand.
But no matter who ends up as the owner, the government is committed to supporting the industry, well aware that Volvo and Saab and their hundreds of suppliers are “big employers” in Sweden with “lots of know-how,” Nilsson said.
“We want to keep that here and to protect it,” he said, adding that Enterprise and Energy Minister Maud Olofsson had developed “close connections and a close dialogue” with the Swedish manufacturers and their US owners, General Motors (GM) for Saab, and Ford for Volvo.
The Swedish car industry employs 140,000 people in a country of just 9 million.
It counts some 700 companies, including internationally renowned truckmakers Volvo Trucks and Scania, as well as airbag and safety belt manufacturer Autoliv, special steels maker SSAB and the world’s leading manufacturer of ballbearings, SKF.
In recent months, as the financial crisis has widened in Europe and the US, the sector has seen numerous savings and restructuring programs involving thousands of job cuts.
At the end of July, Autoliv announced 3,000 jobs would go.
Volvo Cars, which was sold to Ford in 1999, has announced it will slash 6,000 jobs, including 3,900 in Sweden, out of 24,400 employees worldwide.
Ford and GM, as well as the third-largest US carmaker Chrysler, have been hit head-on by a collapse in demand for their gas-guzzling models and this week will ask US lawmakers for a bailout of US$25 billion in government-backed low-cost loans.
Ford said the possible sale of loss-making Volvo Cars was part of its restructuring efforts.
“Given the unprecedented external challenges facing Ford and the entire industry, it is prudent for Ford to evaluate options for Volvo as we implement our ONE Ford plan,” Ford president and chief executive Alan Mulally said in a statement.
A poll published at the weekend showed that seven of 10 Swedes want the state to take over Volvo Cars temporarily.
Meanwhile, Saab, fully owned by GM since 2000, has tried to avoid lay-offs at its Trollhaettan plant in southwestern Sweden, which employs some 1,200 people, by reducing its two shifts to one.
“We have held intense negotiations with the Swedish government,” Saab spokesman Eric Geers said, adding that the center-right government planned to increase its subsidies for research and development.
Nilsson said these subsidies will amount to 450 million kronor (US$55 million) annually for next year through 2012, compared with 430 million kronor this year.
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
A US Marine Corps regiment equipped with Naval Strike Missiles (NSM) is set to participate in the upcoming Balikatan 25 exercise in the Luzon Strait, marking the system’s first-ever deployment in the Philippines. US and Philippine officials have separately confirmed that the Navy Marine Expeditionary Ship Interdiction System (NMESIS) — the mobile launch platform for the Naval Strike Missile — would take part in the joint exercise. The missiles are being deployed to “a strategic first island chain chokepoint” in the waters between Taiwan proper and the Philippines, US-based Naval News reported. “The Luzon Strait and Bashi Channel represent a critical access
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College