Kroymans Corp of the Netherlands plans to file for bankruptcy and shame the General, reports Automotive News [sub]. GM’s importer for Cadillac, Corvette and Hummer in European Union markets will “transfer” the distribution business to GM, “a process it expected to complete by next year.” Har. Har. By the way, has everyone filed their taxes already? It’s best not to wait until the last minute with these things. Your money is urgently needed to allow the CTS sportwagon roam free in its natural environment.

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Friday the 13^th was a bad day for GM Europe, and by extension Opel, Vauxhall, and Saab. Ministers of eleven European countries where GM has a presence met in Brussels to decide what to do about the ailing American automaker’s foreign empire. First, they listened to reports by Frederick “Fritz” Henderson, COO of GM, and Carl-Peter Forster, CEO of GM Europe. Then, they decided to do nothing. Even more disconcerting for GM, the ministers decided that no country should do anything to bailout GM unilaterally. “There will be no rescue measures on a national level without prior European coordination,” reports Automobilwoche [sub]. And as if this wasn’t bad enough . . .
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Folks, TTAC has serious competition. GM just issued a press statement, headlined “GM and Opel Launch Website to Support Fact-Based Discussion.” (As opposed to what? Faith-based?) The lead-in of the statement isn’t really conducive to getting to the main part, but in the interest of fact-based reporting, here it is: “The current need for bridge-financing for GM’s European operations is rooted in a catastrophic economic crisis, the worst of its kind in more than 70 years. Given the significance of the situation politically and for society, it’s only natural that rumor, speculation and urban myths should begin to circulate at this time. In addition to informed reporting based on fact there is also misinformation and repetition of statements that are clearly not based on fact.” Still with us?
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Fiat shares opened up 7 percent at 4.64 Euros, following a newspaper report on a plan to merge with PSA, Reuters reports. The Il Sole 24 Ore newspaper said Italian investment bank Mediobanca has drawn up a report together with a strategic consultant on merging the two companies, and that Fiat Chief Executive, Sergio Marchionne, had yet to decide if or when to present the plan to the board.

A few hours later, Reuters came out with the story that Fiat’s board is not considering a plan to merge with another car maker. How could they, if Sergio is still sitting on it? Fiat then put out a statement saying that they are still interested in collaborating with other car makers to cut costs and enter new markets: “No proposal for a merger with another automotive group is currently under consideration. It is a known fact that Fiat frequently examines opportunities for agreements of various types which would offer it operational synergies and access to new markets.” And what’s Paris saying to the advances?
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Volvo is a step closer to salvation, while Saab is a step closer to damnation.

According to Germany’s Handelsblatt, the European Investment Bank (EIB) has approved a €445M loan to Volvo, after the Swedish government gave a guarantee for 90 percent of the loan. This cash injection should buy Volvo some time to restructure and to pretty-up for a sale. According to Financial Times, Ford has begun seeking indicative bids for Volvo. The sale process is expected to last until late in the year. Three people involved in—or briefed on—the sale say Volvo has drawn tentative interest from at least three Chinese carmakers. Talks have also been held about forming a Swedish-led investor consortium amid concerns among some in Sweden’s motor industry about the possible leakage of intellectual property to China.

Totally different (downright ugly) picture at Saab.

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Or die trying given the late unpleasantness of all things economic. But the model that Euroda, a group of 4,000 Opel/Vauxhall dealers, is attempting is innovative enough to attract some attention. Under the arrangement, member dealers would donate €150 per vehicle sold over the next three years. Euroda would use the estimated €400m to buy a minority stake in Opel/Vauxhall, which cannot secure support from European governments without better long-term viability plans. Euroda seems to be acknowledging the symbolic nature of the effort, telling Automotive News [sub] that even taking a minority stake sends “a clear signal of support” to the government, worker and customer stakeholders.

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We at TTAC are aware of the strain we’ve been placing on attention spans today, what with the six (!) full-length pieces we’ve published today and all. In honor of your noble sacrifice at the altar of literacy we present a gallery of photos from our photographer in Geneva, Tim Sutton. Without comment. Enjoy.

Last year, here in Geneva, the Tata Nano was the sensation, and not only for those who thought a two thousand dollar car for the developing-country masses was world-changing. This year, the sensation is that the Nano is for the rest of us, too—at least for those of us with empty pockets and miniscule automotive requirements.

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One of the things buzzing here at the Geneva Salon is Kia’s No. 3, which, although a concept, is close to what will be marketed in 2010. No. 3 is a mini-minivan built upon the Soul platform, but has an unminivan-strong stance, recognizable personality and some pretty nifty details, such as gold Barbie-leather seats. You could tell Peter Schreyer is proud of this first Kia that is 100% his own design. Pistonheads know Schreyer as the Kraut who was responsible for the first Audi TT and the Audi A2. No 3 is also notable for the new Kia corporate grille, which will intend to make Kias instantly recognizable to one and all. Even to the overtaxed motor-show eye, it works without being ostentatious in an Audi sort of way, so one looks forward to the Schreyer treatment on the upcoming mid-class Kia Magentis. All very nice, but what about the oddtastic name? As the PR lady explained to me, Kia will overhaul all its names around the idea of Number One for the smallest, Number Two for the second smallest . . . . “Gasp, you don’t really intend to call them that, do you?” “No, it’s just an idea”, she replied, “we might call them K1, K2, K3 etc, or something else—we’ll see”. Well, that’s a relief.

Up to now, straight state subsidies were a big non-no in the EU, except in extremely rare and narrowly defined special cases, say farmers, Airbus, windmills, and a catalog so long that it needs a special website. Subsidies to carmakers definitely were against the rules, except in the guise of “green” programs. That was then. For the sake of political expediency, “soft loan and loan guarantee schemes put forward by Britain, France and Germany in an attempt to help companies through the current economic crisis have been approved by Brussels under the recently-relaxed state aid rules,” the Financial Times reports. Bailouts are cool, at least temporarily.
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I admit, I have a strange fascination with watching cars crash. And though large, heavy cars can cause some of the most dangerous accidents, there’s something particularly satisfying about watching a small car hit the wall (or get hit by a large, heavy car). As an American I feel hard-wired to expect smaller cars to explode into a million pieces of tin foil and socialized medicine every time I see one making a slow-mo impact in a crash test. But the glory days of “hoo boy!” moments in compact crash tests seem to be coming to a close. Toyota’s tiny iQ just logged a five-star rating from Europe’s NCAP crash testers, and as this video shows, the drama just never shows up. A cocoon of airbags, some brilliant crumpling and surprising side-impact resilience take a lot of the “sucks to be that dummy” entertainment value from the iQ test video. Oh well. I guess it’s time to move on to watching Chinese car crash tests. Schadenfreude doesn’t feed itself.

The New York Times reports that the European Union is drafting trade duties on imported American biofuels to protect its own $10b biofuel industry. Even though both the US and the EU subsidize biofuels, European producers complain that American producers benefit from production subsidies in the US and retail subsidies in Europe. The EU has been investigating these claims, and tariffs of 44 euros per 220 lbs of imported biofuel could be put in place by this summer. Meanwhile American subsidies for corn ethanol production are set to expand indefinitely. We’ve argued that trade disputes could bring the bailout boom to a rapid close, but perhaps such a dispute will rid us of wasteful ethanol pork first.

Now that’s its all over bar the shouting (Saab has filed for the Swedish equivalent of bankruptcy), the shouting begins. Saab’s new owners (themselves) say they need $1B to stay in the game, and they want GM to pay it. (Reparations?) Automotive News [sub] reports that GM is willing to surrender a big chunk of your taxes to cut bait and [Swedish] fish. But not a billion. “GM Europe’s head of communications Chris Preuss said GM was prepared to provide some funding for Saab but the brand needed outside money as well.” And who in their right mind would provide the lion’s share of this IV drip? “We have asked the Swedish government for loan guarantees for $600 million to give Saab a balance sheet as an independent unit which will allow it to continue.” The Swedish government has said no. So Saab is hitting up the European Investment Bank for a €500m loan. So . . . now what?

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Today, the Supervisory Board of Saab decided to declare bankruptcy, Automobilwoche [sub] writes. The 4000 employees of Saab are being informed at a meeting how the company will continue. The company is now under the supervision of an insolvency administrator. Since Sweden’s government had turned down bailout requests of the mother ship GM, according to Swedish media, one possible solution would be a merger of Saab with a spun-off Opel.

[Here’s a link to the document filed today at the court. The English version starts on page 7 of the pdf.]

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From the Lorinser press release:

While it was derided at first, the Smart has since evolved into a hip cult-car—even in “big block” USA. Its success story is no surprise: the defiant small car still embodies the principles of good economic and ecological sense while being completely free of a “piggy-bank look” and “everyman design.” Consequently it suits the times perfectly. So why is Sportservice Lorinser forecasting a dark future for the Smart? Because black is suiting the dynamic light metal alloys Speedy perfectly.