Autoblog UK

It looks as though open-top specialist Karmann has been thrown a lifeline. Volkswagen have offered the insolvent company a rescue package in the form of a takeover. Apparently, talks are well advanced between the Wolfsburg giant and the north German niche manufacturer. The sticking point appears to be the price, with Karmann claiming to be worth 65 million euros. It is also not quite clear which parts of the company VW intend to swallow up. Karmann currently has a 1,600-strong workforce, 800 of whom are facing immediate redundancy.

The Osnabrück-based carmaker boasts a long tradition stretching back to the year 1901. The most famous model ever produced was the Karmann Ghia in the 1950s, a coupé version of the VW Beetle. Production of this vehicle, which achieved cult status around the globe, came to an end in the 1970s. Since 1949, Karmann have been manufacturing complete cars in small production runs, totalling 3.3 million units over the six decades.

In Germany, well-known body specialist Karmann is the latest victim, as this automotive company with great tradition has now also fallen foul of drastic cuts in demand and the global economic crisis. The reason cited by Wilhelm Karmann GmbH in Osnabrück on Wednesday was the threat of inability to pay given the level of their obligations. A cleanup strategy from September 2008 indicated that 2009 would at least show balanced results. With a tradition exceeding 100 years and worldwide workforce of some 8,000 employees, the companywent on to say that it saw itself fundamentally capable of being restored to profitability, being virtually free of any bank loans.

The Osnabrück-based company became internationally well-known in the Fifties by constructing the legendary VW Karmann Ghia and in the meantime achieved global fame as a convertible specialist for many manufacturers. Karmann planned to completely close vehicle production in May 2009 at their Osnabrück location by ceasing their conversion of the Mercedes CLK Cabrio. This has led to operational redundancy for a total of 1,300 employees. It was in February that the last Audi A4-Cabriolet rolled off the production lines at the Rheine works.