The European Investment Bank (EIB) has given the green light to loans to European-based car makers totalling EUR600m, including EUR400m for Saab Automobile. The money is expected to help in the planned sale of the firm by its parent General Motors but there is no sign yet of a requested guarantee from the Swedish government.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Sweden said Saab will still have to wait for a decision on guaranteeing the EIB loan which is contingent on a state guarantee from Sweden.
“Not until the European Commission has approved of the conditions and there is an agreement with Riksgalden (Sweden’s debt office) can the government consider granting loan guarantees,” state secretary Goran Hagglund told Reuters in a statement.
The EIB said the Saab loan would be used for research and development activities for the improvement of fuel efficiency and safety, including new tooling for the production of cleaner and safer cars, subject to the EC’s approval of the Swedish state guarantee.
A EUR200m loan was also approved for Renault to support a new production facility near Tangiers, Morocco, for manufacturing smaller cars, including the design, civil engineering, purchase of equipment and tooling of the new factory.
Since December 2008 the EIB has approved loans to the automotive sector (manufacturers and suppliers) totalling EUR7.56bn, of which EUR4.52bn was under the EIB’s European Clean Transport Facility (ECTF).
Some EUR320m of the EUR400m approved for SAAB will be provided under the ECTF. The facility, part of the EIB’s wider response under the European Economic Recovery Package, targets significant cuts in vehicles’ CO2 emissions through research, development and innovation, as well as the production of cleaner and more fuel-efficient cars and other means of transport.
The remaining EUR80m is intended to help SAAB improve the active and passive safety of its future vehicles.
So far this year EUR3.6bn has already been disbursed to the automotive sector and it is forecast that this figure will reach around EUR6bn by year-end. Further disbursements will follow in 2010, the bank said.
The loan had been seen as essential if luxury car maker Koenigsegg was to buy Saab.
Koenigsegg, backed by US and Norwegian investors, struck a preliminary acquisition deal earlier this year, but concerns have continued to surface over whether it had the financial muscle to buy and run Saab.
