Subcontractors and part suppliers to Volvo cars denied bank loans
Sunday, 16 December 2012
Several major suppliers and subcontractors to Volvo Cars
corporation have been denied loans aimed at helping them develop future
car models. The trade association FKG is now warning that the entire
industry is in flux and requires that the government intervene.
Speaking to Swedish television, Fredrik Sidahl, President of FKG
representing subcontractors in the automatic sector said "they are
seriously not being able to participate and develop future models
together with some customers just because one cannot not get
credit that was normal in the old days."
In early December, Volvo Cars presented its very aggressive growth plan
for the Sweden market. The plan takes a shape of new structures being
In Gothenburg there is a completely new body plant being built. There
is a whole new generation of cars and engines to be developed - an
investment of Skr35 billion. In addition, Volvo has put a lot of large
orders with its suppliers but the banks look at the industry and
feel that it is in crisis.
Evidence of this is the halt in several cases in which banks don't want
to invest in their operation because they have interpreted the market
as that the sector is in crisis. But this is a similar situation seen
in Europe which the governments there have come in and is providing
assistance to those industries.
"Soon it will be too late for Sweden. In Europe, the industry is
already in supports of the states. In England, there is a very powerful
program for industrial vehicle manufacturers. Germany also has a great
program for their industry with their research," says Fredrik Sidahl.
The Swedish contractors want quick action to be taken otherwise, they
believe that there is a risk that many large companies would be forced
to give up. This is serious for Sweden, for it is one of the European
countries that is most dependent on its automotive industry.
By Scancomark.com Team
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