Matra Automobiles expects to know by the middle of next month whether German supplier Albert Weber will acquire it.
The French coachbuilder needs a rescuer. At stake is the future of Matra's plant at Romorantin. The central France factory is running under capacity since it stopped building Renault's Espace minivan in October.
"By mid-March we expect to know the outcome of the negotiations with potential buyers, most notably Weber," said Matra spokeswoman Arielle de Clermont-Tonnerre.
Besides Matra's survival, the future of the Renault Avantime that Matra now builds may be at stake. At a press conference on Renault's 2002 results, Chairman Louis Schweitzer excluded any possibility that Renault might take over Avantime production if Romorantin is closed.
Renault replaced Matra's loss of Espace production by giving it the Avantime instead. But the large, two-door coupe is selling well below expectations. As a result, Matra's 2002 revenue declined 31.4 percent to E782 million from E1.14 billion in 2001.
Avantime production was as low as 20 units a day last December compared with a target of 120 at its launch 18 months ago. Customers balked at paying E29,150 for the Espace-based coupe.
Launching a cheaper limited edition which costs E26,000 and features a sliding glass roof has boosted Avantime volume to 30 cars a day. But "that's not enough," said Clermont-Tonnerre. "We need to produce 60 Avantimes a day for the plant to break even."
If no buyer for the company emerges, Matra would have to close its plant. The factory employs 1,043 workers, down from 2,500 in 2001.
Matra, owned by French media and defense group Lagardère, has been for sale for many months. Lagardère hired investment bank Natexis to find a buyer for Matra.
Weber would buy all of Matra, not just parts of it, Clermont-Tonnerre said. Besides Romorantin, Matra owns technical centers near Paris and a test track at Mortefontaine north of Paris, where its engineering teams are based.
"We are still in an advanced stage of negotiations," said Paul Bauerle, Weber's managing director. "We may conclude negotiations in early March."
Weber supplies engine parts for Matra's M72 buggy, scheduled for launch at the end of 2003 if Romorantin survives.
The family-owned supplier, based in Markdorf in southern Germany, makes engine blocks, cylinder head castings and other components. Its revenues in 2002 were E120 million.