GM says Saab autos should focus on US

STOCKHOLM, Jan 11, 2003 Reuters reported that the loss-making Swedish Saab Automobile unit of U.S. General Motors should focus on growth in the United States and expand its product portfolio, Chief Executive Rick Wagoner said on Saturday.

"The best way to get Saab big and profitable is to grow in the U.S.," Wagoner told Swedish daily Dagens Nyheter.

"Fast growth in the United States has the highest priority. I am not saying that this would happen at the cost of Europe, but the focus must be here," he said in an interview in Detroit.

Saab, whose brand has lost some of the cachet it enjoyed among young urban professionals in the late 1980s, has posted a financial loss in 10 of the last 12 years and last reported profits in 1994 and 1995 after the launch of a revamped 900 car.

The unit said in November it would cut 20 percent of its workforce, or about 1,300 jobs, in an overhaul aimed at improving its financial situation from 2003.

Besides a weak global economy, Saab Automobile has suffered from start-up costs for its new 9-3 saloon, investments in its main Trollhattan plant and a deteriorating dollar exchange rate to the Swedish crown.

Wagoner said the 9-3 model had been received very well but the firm needed more products, and quickly.

He also implied that some of the forthcoming Saab models could be produced in the United States, the paper said.

"We can not have all of our eggs in the same basket what comes to a European cost structure and American dollar-based sales," Wagoner said, referring to the drastic impact of a weakening dollar (SEK=) on Saab's profits.

Analysts have said they were cautious about Saab's chances of a quick recovery but the brand still had potential for GM as a premium European product.