The future of Saab appeared to be in jeopardy yesterday after the Swedish Government ruled out rescuing the company — despite a warning from General Motors, Saab’s parent, that the division could file for bankruptcy protection within days.

The Government hit out at the American carmaker, which has been trying to sell Saab, after it also said that it would cap finance to the operation by the end of this year. The move, part of a huge restructuring by General Motors (GM), which will cut 47,000 jobs worldwide, would effectively cut Saab adrift. GM is seeking up to $30 billion (£21 billion) from the US Government to stay afloat.

Maud Olofsson, the Swedish Industry Minister, said: “I’m deeply disappointed in General Motors. They have in practice removed their hand from Saab . . . Instead, they are handing over responsibility to Swedish taxpayers . . . We don’t know how much money GM is prepared to put into Saab. They have said they are going to do this for a year, but in order to keep operating it for a year they need SKr8 billion [£640 million] to SKr10 billion and they want us to provide SKr5 billion on top of that.”

GM’s attempt to make its entire business viable involves $1.2 billion of cost cuts in Europe. The company said that it expected no profits in Europe until 2011. Of the 47,000 job cuts, 26,000 will fall outside the United States, with most expected to hit Europe, where costs are higher.

GM, which has about 50,000 employees in Europe, said it was seeking partners for Opel, its German unit. The American group also operates Vauxhall, the British carmaker, which is in talks with unions over cost reductions. The group said that it was seeking government help from Sweden, Germany, Britain, Canada and Thailand.

Mikael Wickelgren, a car industry expert at the University of Skövde, said that the prospects for Saab, which employs more than 4,100, were very bad. He said: “They have to create a Saab [car business] that is suitable for sale.” He described the unit as only “a brand and a factory” and added: “Very few companies are in the market for more factories.”

Sweden has offered to guarantee some loans to Saab from the European Investment Bank, but it said that GM had rejected this.

In December, Sweden said it would look at emergency loans and credit guarantees to its carmakers. The country also faces uncertainty over Volvo, which is owned by Ford, another American group, and is also for sale.

Carl-Peter Forster, the head of GM in Europe, underlined the gravity of the situation across Europe in a blog yesterday, saying that the market was in its worst state since the Depression of the 1930s. He said: “I’ve seen no forecasts or analysis that shows the European automotive market recovering anywhere near to the levels in 2007 for at least several years, if not longer.”

He said that all options, including closures, had to be considered, adding: “We’ll engage these discussions with an open mind to any ideas or alignments that may make us viable for the years to come. But there is no easy pathway . . . these actions will require sacrifice and pain from all sides.” The main problem in Europe was a near-term lack of liquidity, said GM, which first bought half of Saab, which used to be a byword for cutting-edge technology, in 1989 and bought the remaining stake nine years ago. It bought the half-share in the business from Investor IB, the investment vehicle of the Wallenberg family, one of the wealthiest families in Sweden. The Wallenbergs are understood to have a ruled out a rescue bid for the carmaker. One well-placed source said: “If they decided 20 years ago to leave the car industry, why would it look any more attractive now?”

Saab, based in Trollhattan, southern Sweden, has been making cars since 1949 and has been loss-making since 2001. For 2007, returns lodged in Sweden show that Saab made a SKr2.1 billion loss. Last year Saab’s sales fell 25 per cent to 93,295 vehicles — 1.1 per cent of GM’s total.

Swedish unions fear that if Saab collapsed, the jobs toll would hit 15,000 from losses in the supply chain and related activities.

GM told the US Treasury that its Saab, Hummer and Saturn brands had generated losses of $1.1 billion last year. Late on Tuesday it said that it would wind down Hummer, its large SUV marque, by the end of this quarter if it could not find a buyer, after seeking one for the better part of a year.

GM wants help from the US Government through to 2011 and could need more after that if it has to make contributions to its pension fund. It will close 14 plants in America — five more than planned at the end of last year. The company has warned that the cost of it declaring bankruptcy would be $100 billion and up to three million American jobs.

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