Volkswagen and Porsche are to merge.
That follows an agreement reached between the controlling shareholders, the Porsche and Piech families at a meeting in Salzburg, Austria. The aim of combining the sports-car maker with Volkswagen is to reduce the two companies nine billion euros of debt. The ten different car marques that make up the two firms will remain independent. A decision on a new company structure will be made within four weeks. Meanwhile Saab has said it would welcome a takeover offer from Fiat. The Italian car maker is known to have spoken to the Swedish government and reportedly could next have direct talks with Saab and its owner, the ailing US company General Motors. So far Fiat has concentrated on the rest of GM Europe – Opel in Germany and Britain’s Vauxhall. Fiat boss Sergio Marchionne’s plan faces opposition from German and British unions because of probable job losses. BMW has announced a loss for the first-quarter due to sinking sales and said it was unable to give a profit forecast for the full year. Before interest and taxes the German car and motorcycle maker’s loss was 55 million euro euros but that was much less than the 291 million euros that analysts had predicted. BMW has cut production by a third to reduce inventories and said it has written off 2009 as a transition year when it will concentrate on meeting earnings targets during this unprecedented industry crisis.